What is the term for illegal practices wherein one party is coerced to purchase insurance?

The term for illegal practices wherein one party is coerced to purchase insurance is known as coercion. Coercion involves pressuring or forcing someone to act against their will, often through threats or intimidation. In the context of insurance, this can create an unfair situation where an individual is compelled to buy a policy that they may not need or cannot afford, which undermines the principles of a voluntary and informed decision-making process that is fundamental to insurance transactions.

Coercive practices are not only unethical but also illegal, as they violate the rights of consumers and can lead to a lack of trust in the entire insurance industry. Understanding coercion as it relates to insurance ensures that consumers are protected from high-pressure sales tactics, and it reinforces the need for regulatory measures designed to promote fair practices within the industry.

Other concepts like fraud typically involve deception for the purpose of financial gain, while misrepresentation refers to providing false information to mislead another party. Indentured insurance is not a recognized term within insurance practices, making coercion the most appropriate term for the situation described.