General Insurance PrinciplesQuestion 197 of 474
A producer offers to pay a client's first month of premium out of her own commission if the client signs today. This practice is:
a.coercion, forcing a purchase by threatening some other harm
b.twisting, misleading a client into dropping a policy already held
c.commingling, mixing a client's premium money with personal accounts
d.rebating, giving value not stated in the policy as an inducement
Explanation
Rebating is offering any share of the commission, or any other thing of value not written into the contract, to persuade someone to buy. Twisting is a different unfair trade practice: using misrepresentation or incomplete comparison to talk a client into lapsing or replacing a policy already in force. Nothing here involves threats, and no client money has been mishandled yet.
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