It's the kracken - everybody run for your lives --aaaaaahhh!!! Nah, it's just another epitoke - a polychaete worm in a reproductive stage. These guys reproduce in a number of ways, but worms like yours change form, from what's originally a bottom dwelling/crawling animal to a free-swimming version. One of these changes involves the development of paddle-like structures that enable the worm to swim up into the water column with a distinctive spiral/corkscrew-like motion, darting to and fro, in order to spawn.
In some species, the gamete-filled posterior segment detaches and swims away on its own to spawn while the anterior/head section returns to the reef and eventually regenerates. In other species, the worm swims up and pretty much explodes, releasing gametes, then dies. In even other species, the worm bears young that are attached to the posterior section in segments, like a train. When the most posterior worm is mature enough, it breaks off and takes off. All the rest of the segments follow suit as they mature.
Unfortunately, I can't see enough of the worm to give you an ID, but if it were me, I'd go ahead and remove it (mainly on the theory that if it's the "exploding" variety, it's going to die anyway and whatever gametes it would shed either wouldn't be fertile, or have anything available to fertilize).
but its as big as your finger!
