Which statement is TRUE regarding life policy replacement?

The statement that patterns of improper replacement may subject an insurer to disciplinary action is true because insurance regulators closely monitor replacement transactions to protect consumers. Improper replacement can involve misleading practices, where an insurer may encourage a client to replace an existing policy with a new one without a legitimate reason. This can put the insured at a disadvantage, especially if they are not informed about the potential loss of benefits or higher costs associated with the new policy. Regulators aim to ensure fair treatment of policyholders, and patterns of improper conduct in replacement transactions can lead to sanctions, fines, or loss of licensing for insurers who engage in such practices. This scrutiny helps maintain the integrity of the insurance industry and ensures that the interests of consumers are upheld.