Current Status Introducing Body:House Bill Number:3242 Primary Sponsor:Boan Committee Number:02 Type of Legislation:GB Subject:Life insurance creditors' rights Residing Body:Senate Current Committee:Banking and Insurance Companion Bill Number:405 Computer Document Number:NO5/7053.BD Introduced Date:Jan 17, 1991 Date of Last Amendment:Apr 10, 1991 Last History Body:Senate Last History Date:Apr 16, 1991 Last History Type:Introduced, read first time, referred to Committee Scope of Legislation:Statewide All Sponsors:Boan McElveen Type of Legislation:General Bill
Bill Body Date Action Description CMN ---- ------ ------------ ------------------------------ --- 3242 Senate Apr 16, 1991 Introduced, read first time, 02 referred to Committee 3242 House Apr 10, 1991 Amended, read third time, sent to Senate 3242 House Apr 04, 1991 Debate adjourned until Wednesday, April 10 3242 House Apr 03, 1991 Read second time 3242 House Mar 28, 1991 Debate adjourned until Wednesday, April 3 3242 House Mar 26, 1991 Debate adjourned until Wednesday, March 27 3242 House Mar 19, 1991 Debate adjourned until Tuesday, March 26 3242 House Mar 05, 1991 Debate adjourned until Tuesday, March 12 3242 House Feb 26, 1991 Debate adjourned until Tuesday, March 5 3242 House Feb 20, 1991 Committee Report: Favorable 26 3242 House Jan 17, 1991 Introduced, read first time, 26 referred to CommitteeView additional legislative information at the LPITS web site.
Indicates Matter Stricken
Indicates New Matter
AMENDED AND NOT PRINTED BY THE HOUSE--APRIL 10, 1991
Done 1/13/92
February 20, 1991
H. 3242
S. Printed 2/20/91--H.
Read the first time January 17, 1991.
TO AMEND SECTION 38-63-40, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO LIFE INSURANCE FOR AN INSURED'S SPOUSE, CHILDREN, AND DEPENDENTS AND CLAIMS OF THE INSURED'S CREDITORS, SO AS TO REVISE THE PROVISIONS FOR THE CREDITORS' RIGHTS UNDER LIFE INSURANCE POLICIES AND PROVIDE FOR THE CLAIMS OF CREDITORS OF THE INSURED UNDER VARIOUS OTHER INSURANCE CONTRACTS.
Amend Title To Conform
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Section 38-63-40 of the 1976 Code is amended to read:
"Section 38-63-40. The proceeds (A) Proceeds, avails, and cash surrender value values of life insurance in the aggregate amount of not more than fifty thousand dollars upon the life of an individual, which has already been or may be taken out, in which it is expressed to be for the primary benefit of the insured's spouse, children, or dependents inure to the use and benefit of the individual or individuals for whose use and benefit it is expressed to be taken out, and the sum or net amount of the insurance becoming due and payable by the terms of the policy is payable to the individual or individuals as stated in this section, free and discharged from the claims of the representatives of the insured or of any of the insured's , and not more than four thousand dollars of the cash surrender value of a life insurance policy if the insured or applicant has filed a petition in bankruptcy within two years of purchasing the insurance, payable to a beneficiary or assignee other than the insured or applicant are exempt from creditors or a person claiming by, through, or under him or them or any of them unless:
(1) the policy was obtained of the insured or applicant whether or not the right to change the beneficiary is reserved and whether or not the policy is payable to the insured if the beneficiary dies first. Premiums paid with the intent to defraud creditors; or
(2) the creditor or representative possesses a valid assignment of the cash surrender value of the policy from the policyholder on a separate form.
In these two instances, the creditor may recover from either the cash surrender value or the proceeds of the life insurance policy of the amount secured by the assignment, with interest, are subject to their claims out of the proceeds.
(B) Proceeds of insurance or annuity contracts, by agreement, may be held by the insurer exempt from claims of the beneficiary's creditors. (C) Proceeds of group insurance contracts are exempt from claims of the creditors of the insured. (D) Benefits of accident and disability contracts are exempt from claims of the creditors of the insured."
SECTION 2. This act takes effect upon approval by the Governor.