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What is tying in insurance?


Asked By: Krisha Agarwal



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Student at Kendriya Vidyalaya Outreach Marketing El Paso United States


Tying is an often illegal arrangement where, in order to buy one product, the consumer must also purchase another product that exists in a separate market. A tying arrangement is defined as "an agreement by a party to sell one product but only on the condition that the buyer also purchases a different (or tied) product, or at least agrees he will not purchase the product from any other supplier. If the seller offering the tied products has sufficient market power in the "tying" product, these arrangements can violate the antitrust laws. Commercial practice of conditioning the sale of one product on the purchase of another product. In the purchase of insurance, tie-in sales are an unfair trade practice when: A. A typical tying arrangement is when a seller with market power for a product (the “ tying” item) requires any customer buying that item to also purchase a second.

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