State RegulationsFL specificDifficulty 3/5
How do Florida's grace period rules differ for an individual annuity contract compared with a life insurance policy?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Fla. Stat. 627.465 gives annuity contracts their own grace period rule: one month, but in no event less than 30 days, with interest on the overdue payment capped at 6% per year. This is narrower than the general life-and-annuity rule in Fla. Stat. 627.453, which sets a 30-day minimum and an 8% overdue-interest cap. Agents should remember the annuity-specific cap because quoting the life figure on an annuity question is a classic exam trap.
Why the other options are wrong
- A) The 30-day minimum with an 8% interest cap is the general life policy rule under Fla. Stat. 627.453, not the annuity-specific rule.
- B) The 31-day figure belongs to health policies with other-than-weekly-or-monthly premium modes, and 10% is the fixed policy-loan interest cap - neither applies here.
- C) The 12% rate is the interest penalty on late-paid health claims under Fla. Stat. 627.6131, not the annuity grace period cap.
Memory hook
Annuity grace: a month, never under 30 days, at 6%.