State RegulationsFL specificDifficulty 3/5
A Florida life insurer is holding lump-sum death proceeds while the claim is processed. What interest rule applies?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Under Fla. Stat. 627.4615, lump-sum death proceeds accrue interest at a rate not less than the Moody's Corporate Bond Yield Average (monthly average) from the date the insurer receives the written death certificate. If that index is ever substantially changed, the statute sets a floor of 8%. The clock starts with the death certificate, not the date of death, and the policy loan rate plays no role in claim interest.
Why the other options are wrong
- A) The 10% cap is the fixed policy-loan interest ceiling under Fla. Stat. 627.4585, not the death-claim interest rule.
- B) The statute requires interest from receipt of the written death certificate, so the proceeds are not non-interest-bearing.
- D) The 8% figure is only the fallback floor if the index is substantially changed, and the trigger is receipt of the death certificate, not the date of death.
Memory hook
The death certificate starts the Moody's clock.