Types of Health Policies — Florida 2-15
11% of the exam
Types of health policies is 11% of the Florida 2-15 exam — about 16 or 17 of the 150 scored questions. It rewards clean product identification: what each contract actually pays, who owns and funds it, how it is taxed, and the Florida-specific minimums and deadlines attached to it.
Disability income: the income-replacement family
Disability income replaces earned income, not medical bills. Four elements drive most questions. Probationary period: a one-time wait after issue before sickness is covered. Elimination period: the days of disability that must pass before benefits accrue — a deductible measured in time. Benefit period: how long payments run. Benefit amount: usually 60–70% of gross pay, so a tax-free benefit never exceeds take-home wages. Lengthening the elimination period lowers premium without shortening the benefit period. Business forms: business overhead expense reimburses rent, utilities and staff pay, never the owner's salary (premiums deductible, benefits taxable to the business). Key employee DI pays the business (premiums not deductible, benefits tax-free). Disability buy-sell funds the purchase of a disabled owner's interest. Group LTD: employer-paid premium means taxable benefits to the employee.
AD&D, accident-only and Florida's limited policies
AD&D pays a principal sum for accidental death and a capital sum for dismemberment; accident only, never sickness. Limited policies pay per event, not per bill. Florida sets minimum standards in Rule 69O-154.106, F.A.C. Accident-only (specified accident) coverage: accidental death at least $1,000, single dismemberment $500, double dismemberment $1,000. Hospital confinement indemnity: at least $10 per day for at least 31 days during any one period of confinement, with no elimination period unless the benefit period is 365 days or more, in which case a three-day elimination period is acceptable. Specified disease (cancer): deductible not in excess of $250, aggregate benefit at least $2,500, benefit period at least two years. Critical illness pays a lump sum on diagnosis of a listed condition. Short-term health insurance is exempt from Florida's preexisting-condition section only if the applicant is clearly told, in the advertising and in the application, in 14-point contrasting type, that the policy is not qualifying previous coverage (s. 627.6045(3), F.S.).
Medical expense plans and managed care
Basic medical expense pays first dollar with low limits and separate hospital, surgical and medical coverages — no deductible. Major medical adds a high maximum, deductible, coinsurance and an out-of-pocket cap; comprehensive major medical merges both. Managed care: an HMO is prepaid and capitated, uses a gatekeeper primary care physician, and covers in-network only except emergencies. A Florida HMO needs two credentials, and the order matters: first a health care provider certificate from the Agency for Health Care Administration (AHCA), then a certificate of authority from the Office of Insurance Regulation — the Office may not issue a certificate of authority to an applicant that does not already hold a valid health care provider certificate (s. 641.21(1), F.S.). An HMO must provide emergency services and care without prior notification or approval, and any additional applicable copayment may not exceed $100 per claim (s. 641.31(12), F.S.). A PPO has no gatekeeper and pays out-of-network at a reduced level. A POS is an HMO with an out-of-network option chosen at the time of service.
Consumer-directed: HDHP + HSA, FSA, HRA
An HSA requires enrollment in a qualified HDHP and no other disqualifying coverage. For 2026 the HDHP deductible must be at least $1,700 self-only or $3,400 family, out-of-pocket may not exceed $8,500 or $17,000, and HSA contributions cap at $4,400 or $8,750 (IRS Rev. Proc. 2025-19). The HSA is owned by the individual, portable, rolls over, and is triple tax-advantaged; the individual, the employer, or both may contribute, subject to the one combined annual limit. Nonqualified withdrawals before age 65 owe income tax plus a 20% penalty. An FSA is employer-established and funded by employee salary reduction, though the employer may also contribute — use it or lose it, apart from a limited carryover or grace period the plan allows, and it is not portable. An HRA is employer-owned and employer-funded only; the employee may never contribute. It reimburses substantiated medical expenses and rollover is the employer's choice.
Group health, conversion, COBRA and Florida mini-COBRA
A Florida small employer averages at least 1 but not more than 50 eligible employees; an eligible employee works a normal workweek of 25 or more hours. Small-group plans are guaranteed issue with an annual 30-day open enrollment (s. 627.6699, F.S.). Conversion (s. 627.6675, F.S.): a terminated member continuously insured at least three months immediately before termination may take an individual converted policy with no evidence of insurability, if the written application and first premium reach the insurer within 63 days after termination. Continuation: federal COBRA applies at 20 or more employees — 18, 29 or 36 months, premium up to 102%, 60-day election. Florida mini-COBRA (s. 627.6692, F.S.) applies to employers with fewer than 20 employees — 18 months, 29 if Social Security finds the beneficiary disabled, premium up to 115% of the applicable premium and up to 150% during the 11-month disability extension; the beneficiary notifies the carrier within 63 days of the qualifying event, the carrier sends the election and premium notice within 14 days, and the beneficiary elects within 30 days of receiving that notice.
Medicare supplement and long-term care in Florida
Medicare supplement (Medigap) fills Original Medicare's gaps. It is standardized, sold by private insurers, and is not Medicare Advantage — Part C replaces Original Medicare with a private network plan. Florida requires a prominently displayed no-loss cancellation clause letting the applicant return the policy within 30 days of receiving it, with full refund of premium paid (s. 627.674, F.S.). Guaranteed-issue open enrollment runs six months beginning with the first month in which the individual is enrolled in Medicare Part B and is either 65 or older or eligible for Medicare by reason of disability or end-stage renal disease — Florida does not limit it to people 65 and over (s. 627.6741(1)(a), F.S.). A preexisting condition may not be excluded for longer than six months, and may not be defined more restrictively than a condition for which medical advice was given or treatment was recommended by or received from a physician within six months before the effective date of coverage (s. 627.6741(2)(b), F.S.). Long-term care covers custodial care Medicare will not: nursing home, assisted living, home health, adult day care. Benefits usually trigger on failing two of six activities of daily living or on cognitive impairment. The policyholder may return the policy within 30 days after delivery for a refund (s. 627.9407, F.S.).
Where people lose points
✗ Probationary period vs elimination period vs benefit period on a disability income policy.
✓ Probationary period = a one-time wait after issue during which sickness (not accident) is not covered. Elimination period = the days of disability that must pass on every claim before benefits accrue; it is a deductible measured in time, and lengthening it lowers the premium. Benefit period = how long payments continue once they start. Only the elimination period repeats claim by claim.
✗ Business overhead expense vs key employee disability vs disability buy-sell.
✓ BOE reimburses actual fixed business expenses — rent, utilities, staff pay — but never the owner's own salary; premiums are deductible and benefits are taxable to the business. Key employee DI pays the business while a key producer is disabled; premiums are not deductible and benefits are received tax-free. Disability buy-sell funds the purchase of a disabled owner's interest, usually as a lump sum after a long elimination period; premiums are not deductible and proceeds are tax-free.
✗ Conversion vs continuation — and federal COBRA vs Florida mini-COBRA.
✓ Conversion moves the person OFF the group plan onto an individual converted policy, with no evidence of insurability, if continuously insured at least three months and the application and first premium arrive within 63 days after termination (s. 627.6675, F.S.). Continuation keeps the person ON the same group plan. Federal COBRA = 20 or more employees, up to 102% of premium, 60-day election, 18/29/36 months. Florida mini-COBRA = fewer than 20 employees, up to 115% (up to 150% during the 11-month disability extension), notice to carrier within 63 days, carrier's election notice within 14 days, 30 days to elect, 18 or 29 months (s. 627.6692, F.S.).
✗ Medicare supplement vs Medicare Advantage (Part C).
✓ A Medicare supplement is secondary: the client keeps Original Medicare, Medicare pays first, and the standardized Medigap plan covers the deductible and coinsurance gaps. Medicare Advantage replaces the delivery of Original Medicare with a private network plan that pays instead of Medicare. A Medigap policy cannot be sold as a supplement to a Medicare Advantage plan. In Florida the Medigap 30-day return right is in s. 627.674, F.S., and the six-month guaranteed-issue open enrollment — keyed to enrollment in Medicare Part B, not to age alone — is in s. 627.6741, F.S.
✗ Free-look length is not one number — candidates lose points applying a single figure to every product.
✓ Individual health insurance = 10 days, and it does not apply to HMO contracts. Medicare supplement = 30 days (s. 627.674, F.S.). Long-term care = 30 days (s. 627.9407, F.S.). Life = 14 days. Annuity = 21 days. Different product lines, different clocks — read which product the question names before answering.
✗ Hospital indemnity vs critical illness vs major medical.
✓ Hospital indemnity pays a flat amount per day of confinement regardless of the bill — Florida requires at least $10 per day for at least 31 days during any one period of confinement (Rule 69O-154.106, F.A.C.). Critical illness pays a single lump sum on diagnosis of a listed condition, whether or not any expense was incurred. Major medical reimburses actual covered expenses after a deductible and coinsurance. Only major medical is tied to the size of the bill.
Numbers to memorize
| Individual health free look | 10 days from delivery; does not apply to HMO contracts |
| Medicare supplement free look | 30 days after receiving the policy or certificate, with full refund of premium paid (s. 627.674, F.S.) |
| Long-term care free look | 30 days after delivery (s. 627.9407, F.S.) |
| Life / annuity free look (for contrast) | Life 14 days; annuity 21 days |
| Individual health grace period | 7 days weekly premium, 10 days monthly, 31 days all other modes (s. 627.608, F.S.) |
| Individual HMO grace period | Contract must state a grace period of not less than 10 days (s. 641.31(15), F.S.) |
| Group-to-individual conversion | Continuously insured at least 3 months immediately prior to termination; written application and first premium within 63 days after termination; issued without evidence of insurability (s. 627.6675, F.S.) |
| Federal COBRA | 20 or more employees; 18 / 29 / 36 months; premium up to 102% (150% during the 11-month disability extension); 60-day election |
| Florida mini-COBRA | Fewer than 20 employees; 18 months, 29 if SSA-disabled; premium up to 115% of the applicable premium, up to 150% during the 11-month disability extension; beneficiary notice to carrier within 63 days of the qualifying event; carrier election and premium notice within 14 days; elect within 30 days (s. 627.6692, F.S.) |
| Medicare supplement open enrollment | 6 months beginning with the first month the individual is enrolled in Medicare Part B and is either 65 or older or eligible by disability or end-stage renal disease (s. 627.6741(1)(a), F.S.) |
| Medicare supplement preexisting conditions | Exclusion no longer than 6 months; may not be defined more restrictively than a condition for which medical advice was given or treatment recommended or received within 6 months before the effective date (s. 627.6741(2)(b), F.S.) |
| Florida small employer group | Average of at least 1 but not more than 50 eligible employees; eligible employee has a normal workweek of 25+ hours; guaranteed issue; annual 30-day open enrollment (s. 627.6699, F.S.) |
| Individual preexisting condition limit | Exclusion no longer than 24 months with a 24-month lookback; credit for prior similar coverage if the previous coverage was continuous to a date not more than 62 days before the new effective date (s. 627.6045, F.S.). Major medical issued on or after 1/1/2014 may impose none at all. |
| Short-term health insurance | Exempt from s. 627.6045 only if the applicant is clearly told, in the advertising and in the application, in 14-point contrasting type, that the policy is not qualifying previous or existing coverage as defined in s. 627.6699 (s. 627.6045(3), F.S.) |
| Hospital confinement indemnity minimum | Not less than $10 per day, not less than 31 days during any one period of confinement; no elimination period unless the benefit period is 365 days or more, in which case a 3-day elimination period is acceptable (Rule 69O-154.106, F.A.C.) |
| Specified disease minimum | Deductible not in excess of $250; aggregate benefit not less than $2,500; benefit period not less than 2 years (Rule 69O-154.106, F.A.C.) |
| Accident-only (specified accident) minimum | Accidental death not less than $1,000; single dismemberment $500; double dismemberment $1,000 (Rule 69O-154.106, F.A.C.) |
| HMO emergency services copay | Emergency services and care must be provided without prior notification or approval; any additional applicable copayment may not exceed $100 per claim (s. 641.31(12), F.S.) |
| HMO licensing (order matters) | Health care provider certificate from AHCA first; then a certificate of authority from the Office of Insurance Regulation, which may not be issued to an applicant lacking a valid health care provider certificate (s. 641.21(1), F.S.) |
| Dependent child coverage | Must cover at least to the end of the calendar year the child turns 25; must also offer the option to continue at least to the end of the calendar year the child turns 30 (s. 627.6562, F.S.) |
| Newborn coverage | Covered from the moment of birth; any notice requirement may not be less than 30 days after the birth (s. 627.641 individual and s. 627.6575 group, F.S.) |
| 2026 HDHP and HSA federal figures | HDHP deductible at least $1,700 self-only / $3,400 family; out-of-pocket no more than $8,500 / $17,000; HSA contribution $4,400 / $8,750, plus a $1,000 catch-up at age 55+ (IRS Rev. Proc. 2025-19) |
| Health claim payment deadlines (claims from an insured) | Reimburse within 45 days of receipt; a contested claim must be paid or denied within 60 days after receiving the requested additional information; every claim must be paid or denied no later than 120 days after receipt (s. 627.613, F.S.) |
| Time limit on certain defenses (incontestability) | After 2 years from the issue date, only fraudulent misstatements in the application may be used to void the policy or deny a claim for a loss or disability starting after the 2-year period (s. 627.607, F.S.) |
Test yourself
No answers here on purpose — retrieving them is the practice. Drill this domain if any of these stall you.
- A client wants the lowest possible disability income premium without shortening how long benefits last. Which policy element do you adjust, and in which direction?
- A Florida employer with 14 employees terminates a worker. Which continuation statute applies, for how many months, at what maximum premium percentage (including during the disability extension), and what do the 63-day, 14-day and 30-day clocks each measure?
- State Florida's minimum-standard numbers for accident-only insurance: accidental death, single dismemberment, double dismemberment.
- A terminated group member wants an individual policy with no underwriting. How long must he have been continuously insured, and what is the deadline for the written application and first premium?
- Compare HSA, FSA and HRA on three points: who owns the account, who may fund it, and what happens to an unused balance at year end.
- A 60-year-old is on Medicare because of a disability and wants a Medicare supplement in Florida. Is she guaranteed issue, what enrollment starts her six-month clock, and what is the maximum preexisting-condition exclusion?
- Give the Florida free-look or return period for each: individual health, HMO contract, Medicare supplement, long-term care, life, annuity.
- Which two Florida agencies must license a health maintenance organization, what is each document called, and which one must be obtained first?