State RegulationsFL specificDifficulty 2/5
A health insurance policy delivered in Florida contains a provision that conflicts with the state's prohibited-provision rules. What is the legal effect on the policy?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Under Chapter 627, Florida Statutes, when a health policy contains a provision that violates the prohibited-provision rules, the policy is not void; instead it is enforced as if it conformed to the statute, with the illegal provision read as the law requires. This protects the insured, who keeps coverage despite the insurer's drafting error. The Office of Insurance Regulation may also take administrative action against the insurer for using a nonconforming form.
Why the other options are wrong
- A) An illegal provision does not void the whole policy or require a refund of all premiums; coverage continues in force.
- B) The policy remains an enforceable contract construed as if it conformed to law; it is not a one-way obligation.
- C) No reissuance is required; Florida law reads the offending provision as if it conformed to the statute.
Memory hook
Bad clause, not bad policy — the law fixes the wording.