The Financial Markets Authority is investigating insurance agents who are trying to profit from needlessly advising consumers to switch policies.
The regulator says it's looked at the extent to which existing policy-holders have been moved between insurance companies by agents.
The practice is known as replacement business in the industry, or churn.
FMA director of regulation Liam Mason said switching could be a high risk to consumers.
"Certainly the findings of what we have got here show that we've got enough concern that we absolutely are going to be following up with this and looking at the behaviour of individual advisors," he said.
The Financial Services Council said it welcomed FMA's report and further investigation was needed into why consumers were switching policies.