Florida Statutes, Rules, and Regulations Common to All Lines
An agent uses the accumulated values in a client's existing policy to fund a new policy with the same insurer, earning fresh first-year commission, and cannot point to any reasoned benefit to the client. Which practice is this?
Answer and explanation
Answer: A. Section 626.9541(1)(aa) describes churning as using values in an existing policy to purchase another policy for the purpose of earning additional premiums or commissions without an objectively reasonable basis for believing the purchase benefits the policyholder. Twisting under (1)(l) turns on misleading representations. Rebating under (1)(h) requires value flowing to the insured. Sliding under (1)(z) concerns unconsented ancillary coverage.Source: Fla. Stat. § 626.9541 — (1)(aa), Churning
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