What is the term for the act of dropping existing coverage due to illegal persuasion for purchasing new insurance?

The correct term for the act of dropping existing coverage due to illegal persuasion to purchase new insurance is "twisting." This unethical practice occurs when an insurance agent persuades a policyholder to cancel their existing insurance policy and replace it with a different one, often under false pretenses or misleading information. The goal is usually to earn a commission on the new policy rather than to benefit the policyholder. Twisting can lead to policyholders losing valuable benefits or incurring unnecessary costs.

The other options, while relevant in the field of insurance, do not apply to this specific scenario. "Fraudulent transfer" typically refers to situations where assets are moved to avoid creditors, and it is not specifically related to the context of insurance policies. "Policy lapse" denotes a situation where a policy is discontinued due to non-payment of premium, not necessarily involving persuasion or any unethical practice. "Assignment" refers to the transfer of rights or benefits from one party to another, which doesn't describe the act of dropping coverage under dubious circumstances. Thus, "twisting" accurately reflects the unethical manipulation involved in changing insurance coverage.