Life insurance policy proceeds; proceeds of other contracts
Sec. 29. (a) Except as otherwise provided in subsection (b), a
trustee shall allocate to principal the proceeds of a life insurance
policy or other contract in which the trust or its trustee is named as
beneficiary, including a contract that insures the trust or its trustee
against loss for damage to, destruction of, or loss of title to a trust
asset. The trustee shall allocate dividends on an insurance policy to
income if the premiums on the policy are paid from income, and to
principal if the premiums are paid from principal.
(b) A trustee shall allocate to income proceeds of a contract that
insures the trustee against loss of occupancy or other use by an
income beneficiary, loss of income, or, subject to section 25 of this
chapter, loss of profits from a business.
(c) This section does not apply to a contract to which section 31
of this chapter applies.
As added by P.L.84-2002, SEC.2.
Last modified: May 27, 2006