Selling a policyholder more insurance than is warranted is known as what?

The term that describes selling a policyholder more insurance than is warranted is referred to as "overloading." This practice involves providing policies that exceed the actual needs of the policyholder, potentially leading to financial strain or unnecessary costs.

In the context of insurance, it is critical for agents to assess the real needs of their clients and provide appropriately sized coverage. Overloading can can also diminish trust between the agent and their client, as clients may feel misled or taken advantage of if they perceive they are paying for coverage they do not require.

Understanding this concept is essential in insurance ethics and client relations, as it underscores the importance of responsible selling and appropriate assessment of clients’ needs.