What is defined as coercion in the insurance practice?

Coercion in the insurance practice refers to actions that involve using force, threats, or intimidation to influence a client’s decision regarding an insurance transaction. This can manifest in several ways, such as pressuring clients to purchase certain policies or making them feel unsafe if they do not comply. It is recognized as an unfair trade practice because it undermines the integrity of the insurance transaction and erodes trust between the insurer and the client.

Other options, such as providing multiple quotes or encouraging discussions about policy options, promote transparency and informed decision-making, which are essential aspects of ethical practice in insurance. Similarly, offering incentives to foster long-term relationships with clients is a common and acceptable business strategy as long as it is done ethically and does not involve coercive tactics.