diff --git a/entityreference_prepopulate.module b/entityreference_prepopulate.module
index 06c7ebb2954188499811450c45c1b0bf222f6ae4..f7653b965db1e9c9af67c17e3eb24e6768437c0b 100644
--- a/entityreference_prepopulate.module
+++ b/entityreference_prepopulate.module
@@ -150,12 +150,16 @@ function entityreference_prepopulate_field_access($op, $field, $entity_type, $en
     return;
   }
 
-  if ($id) {
-    // Entity is already saved. Return FALSE if we need to hide the field,
-    // otherwise ignore.
+  if ($id && empty($entity->is_new)) {
     return $settings['action'] == 'hide' ? FALSE : NULL;
   }
 
+  if ($settings['action'] == 'hide') {
+    // If entity is already saved and not just inserted, deny access, otherwise
+    // ignore.
+    return $id && empty($entity->is_new) ? FALSE : NULL;
+  }
+
   $ids = entityreference_prepopulate_get_values($field, $instance);
 
   if (!$ids && $settings['fallback'] == 'hide') {