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Twisting is illegal in insurance primarily because it involves misleading clients into making unfavorable financial decisions regarding their insurance policies. This practice typically occurs when an agent persuades a policyholder to replace an existing policy with a new one, often not fully disclosing the disadvantages or costs associated with the new policy. This can lead to the policyholder incurring unnecessary expenses or losing valuable benefits from their original coverage. Protecting clients from such deceptive practices is essential for maintaining trust in the insurance industry and ensuring that consumers make informed decisions regarding their financial security.

The other options present concepts that do not align with the ethical concerns surrounding twisting. For instance, while competition among agents can be healthy for the market, twisting does not promote fair competition; instead, it relies on deception. Similarly, simplification of the selling process and fostering long-term relationships are not outcomes of twisting; rather, ethical practices in insurance seek to achieve these goals without misleading clients.