diff --git a/app/assets/javascripts/admin/addon/components/watched-word-form.hbs b/app/assets/javascripts/admin/addon/components/watched-word-form.hbs
index 1570bd74caf..6375e94dd42 100644
--- a/app/assets/javascripts/admin/addon/components/watched-word-form.hbs
+++ b/app/assets/javascripts/admin/addon/components/watched-word-form.hbs
@@ -75,19 +75,21 @@
   </label>
 </div>
 
-<div class="watched-word-input">
-  <label for="watched-html">{{i18n
-      "admin.watched_words.form.html_label"
-    }}</label>
-  <label class="html-checkbox checkbox-label">
-    <Input
-      @type="checkbox"
-      @checked={{this.isHtml}}
-      disabled={{this.formSubmitted}}
-    />
-    {{i18n "admin.watched_words.form.html_description"}}
-  </label>
-</div>
+{{#if this.canReplace}}
+  <div class="watched-word-input">
+    <label for="watched-html">{{i18n
+        "admin.watched_words.form.html_label"
+      }}</label>
+    <label class="html-checkbox checkbox-label">
+      <Input
+        @type="checkbox"
+        @checked={{this.isHtml}}
+        disabled={{this.formSubmitted}}
+      />
+      {{i18n "admin.watched_words.form.html_description"}}
+    </label>
+  </div>
+{{/if}}
 
 <DButton
   @action={{this.submitForm}}
diff --git a/spec/system/admin_watched_words_spec.rb b/spec/system/admin_watched_words_spec.rb
index 500ff9d1932..1eb14e1f04c 100644
--- a/spec/system/admin_watched_words_spec.rb
+++ b/spec/system/admin_watched_words_spec.rb
@@ -24,4 +24,12 @@ describe "Admin Watched Words", type: :system, js: true do
 
     expect(ww_page).to have_error("Word is too long (maximum is 100 characters)")
   end
+
+  it "shows the 'outputs HTML' option when action=replace" do
+    ww_page.visit
+    expect(ww_page).not_to have_text(I18n.t("admin_js.admin.watched_words.form.html_description"))
+
+    ww_page.visit(action: "replace")
+    expect(ww_page).to have_text(I18n.t("admin_js.admin.watched_words.form.html_description"))
+  end
 end
diff --git a/spec/system/page_objects/pages/admin_watched_words.rb b/spec/system/page_objects/pages/admin_watched_words.rb
index 2c61f992182..c30c0ab735f 100644
--- a/spec/system/page_objects/pages/admin_watched_words.rb
+++ b/spec/system/page_objects/pages/admin_watched_words.rb
@@ -3,8 +3,8 @@
 module PageObjects
   module Pages
     class AdminWatchedWords < PageObjects::Pages::Base
-      def visit
-        page.visit "admin/customize/watched_words"
+      def visit(action: "block")
+        page.visit "admin/customize/watched_words/action/#{action}"
         self
       end