December 05, 2020
Print This PagePrint This Page

Bill #:
Chamber: View Search Tips
Search Term:
Year: View Search Tips
Search Term:
       Florida Senate - 2010                              CS for SB 926
       By the Committee on Banking and Insurance; and Senator Richter
       597-02815-10                                           2010926c1
    1                        A bill to be entitled                      
    2         An act relating to trusts; creating s. 736.0902, F.S.;
    3         limiting the duties and liability of certain trustees
    4         with respect to contracts for life insurance; defining
    5         the term “qualified person”; providing for the
    6         application and nonapplication of certain provisions
    7         of state law; requiring that notice of such provisions
    8         be given under certain circumstances; providing
    9         requirements for such notice; providing that such
   10         provisions do not apply if a party notified of the
   11         application of certain provisions of state law objects
   12         in writing; creating a rebuttable presumption of
   13         delivery of notice; defining the term “affiliate” for
   14         specified purposes; providing that certain provisions
   15         of state law do not apply under specified
   16         circumstances; amending s. 518.112, F.S.; expanding
   17         the list of delegable investment functions for certain
   18         fiduciaries; revising requirements for the provision
   19         of written notice by a trustee of an intent to begin
   20         delegating investment functions; providing an
   21         effective date.
   23  Be It Enacted by the Legislature of the State of Florida:
   25         Section 1. Section 736.0902, Florida Statutes, is created
   26  to read:
   27         736.0902Nonapplication of prudent investor rule.—
   28         (1) Notwithstanding the provisions of s. 518.11 or s.
   29  736.0804, with respect to any contract for life insurance
   30  acquired or retained on the life of a qualified person, a
   31  trustee has no duty to:
   32         (a) Determine whether the contract of life insurance is or
   33  was procured or effected in compliance with s. 627.404;
   34         (b) Determine whether any contract of life insurance is, or
   35  remains, a proper investment;
   36         (c) Investigate the financial strength of the life
   37  insurance company;
   38         (d) Determine whether to exercise any policy option
   39  available under the contract for life insurance;
   40         (e) Diversify any such contract for life insurance or the
   41  assets of the trust with respect to the contract for life
   42  insurance; or
   43         (f) Inquire about or investigate the health or financial
   44  condition of any insureds.
   45         (2) For purposes of this section, a “qualified person” is a
   46  person who is insured or a proposed insured, or the spouse of
   47  that person, who has provided the trustee with the funds used to
   48  acquire or pay premiums with respect to a policy of insurance on
   49  the life of that person or the spouse of that person, or on the
   50  lives of that person and the spouse of that person.
   51         (3) The trustee is not liable to the beneficiaries of the
   52  trust or any other person for any loss sustained with respect to
   53  a contract for life insurance to which this section applies.
   54         (4) Unless otherwise provided in the trust instrument,
   55  paragraph (1)(a) applies to any contract for life insurance on
   56  the life of a qualified person.
   57         (5) Unless otherwise provided in the trust instrument,
   58  paragraphs (1)(b)-(f) apply if:
   59         (a) The trust instrument, by reference to this section,
   60  makes this section applicable to contracts for life insurance
   61  held by the trust; or
   62         (b) The trustee gives notice that this section applies to a
   63  contract for life insurance held by the trust.
   64         1. The notice of the application of this section shall be
   65  given to the qualified beneficiaries and shall contain a copy or
   66  restatement of this section.
   67         2. Notice given pursuant to any of the provisions of part
   68  III of this chapter to a person who represents the interests of
   69  any of the persons set forth in subparagraph 1. shall be treated
   70  as notice to the person so represented.
   71         3. Notice shall be given in the manner provided in s.
   72  736.0109.
   73         4. If any person notified pursuant to this paragraph
   74  delivers a written objection to the application of this section
   75  to the trustee within 30 days after the date on which the
   76  objector received such notice, paragraphs (1)(b)-(f) shall not
   77  apply until the objection is withdrawn.
   78         5. There shall exist a rebuttable presumption that any
   79  notice sent by United States mail is received 3 days after
   80  depositing the notice in the United States mail system with
   81  proper postage prepaid.
   82         (6) This section does not apply to any contract for life
   83  insurance purchased from any affiliate of the trustee, or with
   84  respect to which the trustee or any affiliate of the trustee
   85  receives any commission unless the duties have been delegated to
   86  another person in accordance with s. 518.112. For purposes of
   87  this subsection, an “affiliate” is any person who controls, is
   88  controlled by, or is under common control with the trustee.
   89         (7) Paragraph (1)(a) does not apply if the trustee applied
   90  for or accepted ownership of a contract of life insurance and
   91  the trustee had knowledge that:
   92         (a) The benefits were not payable to a person specified in
   93  s. 627.404 when the contract of life insurance was issued; or
   94         (b) The contract of life insurance is or was purchased with
   95  resources or guarantees directly or indirectly provided by a
   96  person who, at the time of the inception of such contract, did
   97  not have an insurable interest in the insured as defined by s.
   98  627.404, and, at the time of the inception of such contract,
   99  there is a verbal or written arrangement, agreement, or plan
  100  with a third party to transfer ownership of the policy or policy
  101  benefits in a manner that would be in violation of state law.
  102         Section 2. Paragraph (b) of subsection (2) and paragraph
  103  (b) of subsection (3) of section 518.112, Florida Statutes, are
  104  amended to read:
  105         518.112 Delegation of investment functions.—
  106         (2)
  107         (b) The delegable investment functions under this
  108  subsection include:
  109         1. A determination of whether the insurance contract was
  110  procured or effected in compliance with s. 627.404;
  111         2.1. A determination of whether any insurance contract is
  112  or remains a proper investment;
  113         3. The investigation of the financial strength of the life
  114  insurance company;
  115         4.2. A determination of whether or not to exercise any
  116  policy option available under any insurance such contracts;
  117         5.3. A determination of whether or not to diversify such
  118  contracts relative to one another or to other assets, if any,
  119  administered by the fiduciary; or
  120         6.4. An inquiry about changes in the health or financial
  121  condition of the insured or insureds relative to any such
  122  contract.
  123         (3) A fiduciary may delegate investment functions to an
  124  investment agent under subsection (1) or subsection (2), if:
  125         (b) In the case of a trust or estate, the fiduciary has
  126  given written notice, of its intention to begin delegating
  127  investment functions under this section, to all beneficiaries,
  128  or their legal representative, eligible to receive distributions
  129  from the trust or estate within 30 days of the delegation unless
  130  such notice is waived by the eligible beneficiaries entitled to
  131  receive such notice. This notice shall thereafter, until or
  132  unless the beneficiaries eligible to receive income from the
  133  trust or distributions from the estate at the time are notified
  134  to the contrary, authorize the trustee or legal representative
  135  to delegate investment functions pursuant to this subsection.
  136  This discretion to revoke the delegation does not imply under
  137  subsection (2) any continuing obligation to review the agent’s
  138  actions.
  139         1. Notice to beneficiaries eligible to receive
  140  distributions from the trust from the estate, or their legal
  141  representatives shall be sufficient notice to all persons who
  142  may join the eligible class of beneficiaries in the future.
  143         2. Additionally, as used herein, legal representative
  144  includes one described in s. 731.303, without any requirement of
  145  a court order, an attorney-in-fact under a durable power of
  146  attorney sufficient to grant such authority, a legally appointed
  147  guardian, or equivalent under applicable law, any living,
  148  natural guardian of a minor child, or a guardian ad litem.
  149         3. Written notice shall be given as provided in part III of
  150  chapter 731 as to an estate, and as provided in s. 736.0109 and
  151  part III of chapter 736 as to a trust.:
  152         a.By any form of mail or by any commercial delivery
  153  service, approved for service of process by the chief judge of
  154  the judicial circuit in which the trust has its principal place
  155  of business at the date of notice, requiring a signed receipt;
  156         b.As provided by law for service of process; or
  157         c.By an elisor as may be provided in the Florida Rules of
  158  Civil Procedure.
  160  Notice by mail or by approved commercial delivery service is
  161  complete on receipt of notice. Proof of notice must be by
  162  verified statement of the person mailing or sending notice, and
  163  there must be attached thereto the signed receipt or other
  164  satisfactory evidence that delivery was effected on the
  165  addressee or on the addressee’s agent. Proof of notice must be
  166  maintained among the trustee’s permanent records.
  167         Section 3. This act shall take effect July 1, 2010.

Site Map
Session:   Bills ·   Calendars ·   Bound Journals ·   Citator ·   Search ·   Appropriations ·   Redistricting ·   Bill Information Reports
Committee Publications
Historical Information
Statutes:   Introduction ·   View Statutes ·   Search Statutes
Disclaimer: The information on this system is unverified. The journals or printed bills of the respective chambers should be consulted for official purposes.    Copyright © 2000-2020 State of Florida.     Privacy Statement     Contact Us     Get Acrobat Reader