Which of the following actions is considered misrepresentation by an insurance agent?

Misrepresentation by an insurance agent occurs when false or misleading statements are made about an insurance product or policy, which can lead clients to make decisions based on inaccurate information. Falsely advertising the benefits of a policy directly constitutes misrepresentation, as it misleads potential clients into believing they will receive certain advantages or coverages that the policy does not actually provide. This type of false statement undermines the integrity of the insurance profession and can lead to regulatory action against the agent, as well as potential harm to clients who may face unexpected outcomes when they find that the promised benefits do not exist.

While offering gifts for referrals or giving lower rates to preferred clients may raise ethical concerns, they do not involve the act of providing false information about a policy itself. Encouraging clients to consider alternative policies is also a legitimate practice aimed at ensuring clients have a thorough understanding of the options available to them and does not involve misrepresentation.