1. The 10-Day “Free Look”
Under our state’s Free Look policy, you can cancel any life insurance you’ve bought within the last ten days for free. That is, your insurer has to give you back your premium payment in full and any other fees involved.
Also, the insurer is still required to pay out the death benefit should the policy holder die within the first ten days of the policy, assuming that the premium was paid and everything else is in good order.
2. The 30-Day “Grace Period”
Under Florida law, you cannot have your life insurance benefit denied immediately upon missing one payment or submitting it late. The insurer must allow a “grace period” of, at minimum, 30 days during which your policy is still in force.
In effect, you would normally have to miss two payments before your policy is simply canceled. Within the first 30 days, your benefit is active, you can submit the late payment to bring the policy back into good standing, and you don’t have to go through underwriting again to restore your life insurance.
3. Interest On Late Benefits
To discourage insurers from needlessly delaying to pay out the death benefit to the beneficiaries after the policy holder’s death, Florida requires insurers pay interest for each day of delay.
There is no rule in Florida saying how quick a claim has to be paid out, but to avoid paying a lot of interest, insurers usually pay out within a month’s time.
4. The Death Benefit Guarantee
In the unlikely event that a life insurance company goes out of business, files for bankruptcy, or is unable to pay out all claims in full for a time due to financial turbulence, Florida law provides that you still get at least a portion of your death benefit.
The Florida Life & Health Insurance Guaranty Association steps in to pay as much as a $300,000 benefit or as high as $100,000 if you’re turning in your whole life policy for its cash value. This guarantee applies per person, so it’s set hard even if you own multiple policies or policies with higher values.
5. Right To Privacy Laws
The privacy of your personal information held by your life insurance company is protected by law in Florida. That means an insurer cannot give out your private data without your consent.
Any failure to abide by state privacy of information regulations exposes violators to (sometimes heavy) fines – besides the reputational harm a company would suffer if consumers found out about such violations.
The existence of the 5 above-listed state regulations of the insurance industry in Florida tends to make it safer to buy and hold a life insurance policy in our state. If you have any questions about these or other consumer protections, feel free to contact Flagler County Insurance Agency today to learn more!