A trustee has an insurable interest in the life of an individual insured under a life insurance policy that is owned by the trustee or that designates the trust itself as the owner if, on the date the policy is issued:

1. (1) The insured is:

   1. (A) A settlor of the trust; or (B) an individual in whom a settlor of the trust has, or would have had if living at the time the policy was issued, an insurable interest; and

2. (2) The life insurance proceeds are primarily for the benefit of one or more trust beneficiaries who have:

   1. (A) An insurable interest in the life of the insured; or (B) a substantial interest engendered by love and affection in the continuation of the life of the insured and, if not already included under subdivision (1) of this section, who are:

      1. (i) Related within the third degree or closer, as measured by the law of this state for determining degrees of relation, either by blood or law, to the insured; or (ii) stepchildren of the insured.

(P.A. 19-137, S. 12.)

History: P.A. 19-137 effective January 1, 2020.