What is defined as 'unfair or deceptive act or practice' in the context of insurance?

The definition of an 'unfair or deceptive act or practice' in the context of insurance encompasses a broader range of behaviors than just fraud. Choosing acts that misrepresent facts or fail to act promptly captures the essence of what this term implies. Misrepresenting information can significantly influence a policyholder's decision-making, leading them to make choices based on inaccurate or incomplete information. Furthermore, the importance of prompt action in processing claims or addressing inquiries is essential to maintain trust and transparency in the insurance process. Failure to act in a timely manner can also be seen as misleading, as it creates uncertainty and potential financial harm to the policyholder. Thus, this choice accurately reflects the various ways in which unfair or deceptive practices can manifest within the insurance industry.