14-7416. Insurance policies and similar
contracts
A. Except as otherwise provided in subsection B of this section, 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 14-7412, loss of profits from a business.
C. This section does not apply to a contract to which section 14-7418 applies.
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