Twisting and churning are unethical and often illegal insurance sales practices in which an agent induces a client to replace existing policies primarily to generate new commissions rather than to improve the client's situation. Twisting usually refers to replacing policies with another insurer through misrepresentation or incomplete disclosure, while churning involves replacing policies within the same company, often using cash values to fund new policies. These practices can harm clients by creating new surrender periods, higher costs, loss of guarantees, and tax consequences, while enriching the producer. Regulators and carriers treat twisting and churning as serious violations of suitability, best-interest, and unfair trade practices rules.

Advisors learn about twisting and churning in compliance training and are expected to avoid any behavior that could be construed as replacement for commission-driven reasons. When recommending replacements, they must thoroughly document why the new policy is in the client's best interest, including side-by-side comparisons of costs, benefits, and guarantees. State insurance departments and carriers investigate allegations of twisting and churning through complaint reviews and market conduct exams. Advisors who adhere to rigorous suitability and disclosure standards protect clients and their own licenses. Understanding twisting and churning helps advisors recognize red flags, provide ethical advice, and differentiate professional policy reviews from abusive replacement schemes.