Which of the following is an example of twisting in insurance?

Twisting in insurance refers to the unethical practice where a producer misrepresents or distorts the facts about a policy or an insurance company to induce a policyholder to surrender their existing policy and purchase a new one. This practice is harmful as it can lead to the policyholder losing valuable benefits or coverage from their original policy based on false or misleading information.

In this scenario, the act of misrepresenting a policy to persuade a policy owner to surrender their current insurance is a clear instance of twisting. It compromises the integrity of the industry and undermines the trust that consumers should have in their insurance providers.

The other options presented do not fit the definition of twisting. Maligning a financial status does not directly involve the misrepresentation of a policy for the purpose of inducing a change. Reducing commissions may be a strategy used to sell policies but does not involve the unethical manipulation of information. Inducing a policyowner with something of value to purchase a policy leans more towards inducement than twisting, as it does not necessarily involve misleading information about the policy itself.