L&HGeorgiahard
A Georgia producer recommends replacing a 7-year-old whole life policy with a new universal life contract from a different insurer but fails to present the Replacement Notice, omits the list of policies being replaced, and tells the client the existing carrier 'is in financial trouble' — a statement the producer cannot substantiate. Under Title 33 and Reg 120-2-24, what is the MOST accurate characterization of the producer's exposure?
Twisting under O.C.G.A. § 33-6-4 combined with Reg 120-2-24 violations; OCISF may impose fines, restitution, suspension, or revocation
BOnly a technical paperwork violation; no licensure consequence because the policy was actually issued
CRebating under O.C.G.A. § 33-6-4, since switching policies constitutes an indirect inducement
DA federal SEC violation only, because life insurance replacement falls under FINRA jurisdiction
Why this is the answer
Inducing replacement through an unsupported negative statement about the existing insurer is classic 'twisting' under O.C.G.A. § 33-6-4. Coupled with failure to present the Replacement Notice and the list of replaced policies required by Reg 120-2-24, the producer faces OCISF enforcement including fines, restitution, license suspension or revocation, and possible rescission of the new contract.
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