Florida Insurance Laws

Free-Look Provision (Fixed and Variable Annuities)

An annuity contract owner has the right to review a new fixed or variable annuity for a period of 21 days with the option to an unconditional refund if not fully satisfied.

Free-Look Provision (Life Policies)

A life policy owner has the right to review a new life insurance policy for a period of 14 days with the option to an unconditional refund if not fully satisfied.

Medicare Supplement Insurance (Medigap)

A health insurance policy or health benefit plan offered by a private entity to individuals who are entitled to have payments for health care costs made under Medicare

Non-Participating Policy (Non-Par Policy)

A policy issued by a company that does not share in its divisible surplus with its policyowners. These are commonly stock insurers.

Participating Policy (Par Policy)

A policy issued through a mutual insurer in which policyowners share in the company's ownership and receive dividends of the divisible surplus of the company's profits.

Rule for Conversion

If an insured has multiple industrial life insurance policies issued by the same insurer with a combined face amount that exceeds $3,000, the owner has the option to merge and convert such policies into one ordinary (whole) life insurance policy through the same insurer, with no further evidence of insurability.

Suicide Clause

In the event the insured commits suicide after the policy becomes incontestable, policy proceeds are paid to the named beneficiary of the policy.

Grace Period for Age 64 and Older

Any life insurance company that covers a natural person who is 64 years of age or older and whose policy has been in force for over 1 year, must provide a notification of impending lapse in coverage after the specified grace period, which allows at least 21 days beyond this grace period for payment of premiums before a policy can lapse for nonpayment.

Prospectus

Considered as the primary source of information for a prospect, contains information regarding the characteristics and purpose of the annuity plan, such as the separate account and risks involved

Defamation

Creating or circulating false, derogatory or malicious information regarding an insurer, whether oral, written or print.

Duplication of Benefits

Florida law prevents a private insurer from having to pay for any illness or injury already paid for by another insurer, thus preventing any duplication of benefits to the insured.

Free-Look Provision

Florida law requires a policyholder's right to examine his or her health policy for a period of 10 days from the date of delivery with the ability to return the policy for a full refund, if he or she is not satisfied. Medicare and long-term care policies must provide a period of 30 days from the date of delivery.

Time Limit on Certain Defenses Provision

This provision prevents from a policy's contestability after a specific time (usually 2 years). However, unlike life insurance, if fraudulent statements are made on a health insurance application, the contract can be contestable at any time unless the policy is guaranteed renewable.

Assignment of Policies

This stipulation allows the policyowner to transfer their policy to another party, whether it is an individual, company, organization, etc

Coverage for Handicapped Children

When a handicapped child is covered under a group family health insurance plan or an individual family health plan, the insurer must provide coverage even after he or she becomes an adult.

Florida Viatical Settlement Act

Regulates viatical settlement contracts and providers and prohibits any future viatical settlement licenses to be issued after 2005. As a result, only licensed life insurance agents may offer or attempt to negotiate on behalf of another individual in a viatical settlement contract.

HIPAA (Health Insurance Portability and Accountability Act )

Requires that anyone with 18 months of creditable coverage, and who does not have access to other health insurance, must be given access to an insurance policy.

COBRA (Florida Health Insurance Coverage Continuation Act (Mini-COBRA))

The purpose of this Act is to ensure continued access to affordable health insurance coverage for employees of small employers (20 employees or less) and their dependents, as well as other qualified beneficiaries not currently protected

Bonds

A debt investment in which an investor loans money to a company or governmental entity that borrows the funds for a specific period of time, and provides a fixed interest rate in return

Misrepresentation

A false statement or lie that can render the contract void.

Copayment

A specific dollar amount that the subscriber must pay upon receipt of covered health care services.

Universal Life Insurance Plans

A type of permanent insurance that offers more flexibility, including more control over the cost of premiums as well as the ability to invest and earn interest on the policy's cash value.

Maternity Benefits

Although group medical expense policies are required to provide this, Florida law does not have a requirement for such benefits under individual health insurance.

Controlled Business

An entity that obtains and possesses a license solely for the purpose of writing business on the owner, immediate family, relatives, employer and employees.

Contributory Group Health Insurance Plan

An group insurance plan where premiums are jointly paid by the employer and participating employees.

Provider

Any physician, hospital, or other institution, organization, or person that furnishes health care services and is licensed or otherwise authorized to practice in the state.

Newborn Child Requirements

Coverage for injury or sickness, including the necessary care or treatment of medically diagnosed congenital defects, birth abnormalities or prematurity, including costs associated with any appropriate transportation.

Policy Loan Interest Rate

Florida Insurance Code allows an insurer to charge a fixed rate up to 10% annual interest on any loan taken against the policy's cash values.

Grace Period

Florida law mandates this for missed premiums based on the premium mode of the policy

Non-Contributory Group Health Insurance Plan

Group insurance plan where premium is paid entirely (100%) by the employer. The advantage of a noncontributory group health plan is that employer provides health insurance to their employees without any assistance in premium.

ART (Annual Renewable Term) or YRT (Yearly Renewable Term)

Group life insurance is usually written as a one year renewable term plan that does not require medical examinations. In the event a group life insurance policy expires or is cancelled, the insurer is required to notify each certificate holder.

Holocaust Victims Insurance Act

Holocaust victims and their families receive appropriate assistance in the filing and payment of their rightful claims.

Uniform Simultaneous Death Act of Florida

If a common disaster clause is included in the policy and the primary beneficiary outlives the insured for a period of time specified in the contract, policy proceeds are then paid to any contingent beneficiaries named in the policy.

Reinstatement Provision

If a policy were to lapse either by accident or purposefully, policyowners have the right to reinstate their plan as long any missed premiums are paid and evidence of insurability is provided.

Group Participation Requirement

In the state of Florida, there is no minimum number of members required for a group life insurance policy, as long as the organization is eligible for group life insurance.

Rejected Business (Excess Business)

Occurs when an insurer with whom an agent is appointed rejects an individual application for insurance due to underwriting reasons, or if the amount of insurance is in excess of what the company is willing to write, the agent can then place the business with a company with whom he or she is not appointed.

ERISE (Employee Retirement Income Security Act of 1974)

Protects employee retirement plans by establishing rules that qualified plans must follow to ensure that plan fiduciaries do not misuse plan funds. The Act mandates plans to provide participating employees with important plan information regarding features and benefits, as well as funding.

Churning

The act of depleting the funds of one insurance policy to purchase another policy within the same company for no purpose other than to generate new commission for an agent or agency from an existing customer.

Capitation

The fixed amount paid by an HMO to a health care provider under contract with the health maintenance organization in exchange for the rendering of covered medical services.

Exclusion Ratio

The formula that determines the ratio of taxable to nontaxable proceeds in an annuity payment.

Variable Life Insurance Plans

The main purpose of this is to help offset, or hedge, the effects of inflation on a policy's death proceeds.

Annuity Units

The shares an annuitant owns in the variable annuity subaccounts

Dollar Cost Averaging

The systematic purchase of securities at regular intervals and at a fixed amount.

Policy Lapse

The termination of an insurance policy due to unpaid premiums.

Unfair Discrimination

Unlawfully discriminating between individuals of the same class or insurance risk by charging different rates of premium, offering different benefits, or charging extra fees based on residence, race, religion, or national origin.

Investigation of loss

Upon receiving a proof of loss statement, the insurance company will confirm that the claim is valid and that the medical treatment was usual and customary. During this time, the insurance company can demand an independent medical examination to assist in determining whether a claim is valid.

Fraud

Wrongful or criminal deception intended to result in financial or personal gain. An example would be falsifying a proof of loss to an insurer in order to receive policy benefits.

Paid or Contested

after the insurers evaluation of the claim, the claim is...

Vesting

an employee's ownership in benefits or contributions accrued on behalf of the employee in a pension plan.

Sliding

charging an applicant for a specific coverage or product, in addition to the cost of the insurance coverage applied for, without the informed consent of the applicant

Accumulation Units

consist of premiums paid and credited to the account after a deduction for expenses incurred.

Incontestable Clause

if an insurer finds that fraud or misrepresentation has occurred, they may demand the policy be returned and any premiums paid by the policyowner be refunded.

Spendthrift Clause

protects against a creditor's claims on any unpaid proceeds to a beneficiary.

Coordination of Benefits

refers to insurance companies coordinating the payment of benefits in the event an insured has more than one group health insurance policy, ensuring prevention from a duplication of benefits.

Proof of loss

simply a written statement that outlines the accident or illness and the extent of loss that occurred within 15 days after notice of claim

Insolvency

the inability to pay debts when they are due

Subscriber

the person who has been insured; an insurance policy holder

Coercion

the practice of persuading someone to do something by using force or threats

Twisting

to induce a policyowner to forfeit or change insurance from one company to another in order to gain commission for an agent or agency.

Florida Healthy Kids Corporation

was established by the Florida Legislature in 1990 as a dual effort between both the public and private sectors to improve healthcare access for Florida's uninsured children. helped provide health insurance for over a million of Florida's youth since it began providing coverage; however, is not a state agency.