What Is Sliding in Insurance Terms?

What is Sliding

Sliding in insurance refers to the unethical and illegal practice of an insurance agent or broker adding unauthorized coverages, products, or fees to a policy. This practice occurs without the policyholder’s full knowledge, consent, or adequate explanation. It represents a deceptive act that harms consumers and can erode public trust in the insurance industry. The core issue with sliding is the lack of informed consent from the policyholder regarding all aspects of their insurance purchase.

This practice is designed to improperly inflate the premium, thereby increasing the agent’s commission or the insurer’s revenue. This deceptive conduct misrepresents the true nature and cost of the insurance product being sold. For instance, an agent might tell a customer a supplemental coverage is free when an additional fee is actually required. The practice violates fundamental principles of fair dealing and transparency in insurance transactions, making it a form of misrepresentation.

How Sliding Occurs

Sliding often occurs through misleading tactics employed by agents during the sales process. One common method involves adding ancillary coverages, such as roadside assistance, accidental death benefits, or travel insurance, to a primary policy without explicitly discussing them with the policyholder. Agents might present these additions as mandatory or automatically included in a standard package, even when they are not.

Another tactic involves embedding extra fees for services that were neither requested nor rendered, often by obscuring them within complex policy language or during a rushed transaction. In some instances, an agent might even add a policy for a completely different product, like a life insurance policy, when the customer only sought something else, such as auto insurance. Digital platforms can also facilitate sliding, for example, by pre-selecting optional coverages that a consumer must actively “uncheck” to avoid purchasing.

Impact on Policyholders

The practice of sliding directly harms policyholders in several ways. Primarily, it leads to increased premium costs, as consumers unknowingly pay for unwanted or unnecessary coverages and fees. This financial burden can be significant, especially if multiple unauthorized additions are made to a policy. Policyholders may also mistakenly believe they have certain coverages, only to discover during a claim that the coverage is either non-existent or different from what they understood.

Conversely, a policyholder might have coverage they are unaware of, leading to missed opportunities for claims. This confusion undermines the purpose of insurance, which is to provide clear financial protection. The deceptive nature of sliding also erodes trust in insurance agents and the broader insurance industry. Policyholders are then left with the burden of identifying and attempting to rectify these unauthorized additions, which can be a time-consuming and frustrating process.

Regulatory Framework

Insurance regulators view sliding as a serious violation of consumer protection laws and fair trade practices. State insurance departments are the primary bodies responsible for overseeing agent conduct and ensuring compliance with insurance laws.

The practice violates principles of good faith and fair dealing inherent in insurance contracts. Regulators emphasize that informed consent is a fundamental requirement for all insurance transactions. State regulatory bodies, such as the Florida Office of Insurance Regulation, issue bulletins and take action to remind insurers and agents that sliding is prohibited under unfair insurance trade practices acts.