(SB 52)
Burial expenses, payment by life insurers and
fraternal benefit societies revised.
Section
1.
That
§
58-37A-17
be amended to read as follows:
58-37A-17.
The owner of a benefit contract may change the beneficiaries in accordance with
the laws or rules of the society unless the owner waives this right by specifically requesting in
writing that the beneficiary designation be irrevocable. A society may, through its laws or rules,
limit the scope of beneficiary designations and shall provide that no revocable beneficiary may
obtain any vested interest in the proceeds of any certificate until the certificate has become due and
payable in conformity with the provisions of the benefit contract.
Section
2.
That
§
58-33-23
be amended to read as follows:
58-33-23.
All
burial
life
insurance benefits shall be paid in cash to the beneficiary. No insurer
engaged in the business of
burial
life
insurance shall contract to pay or pay such insurance benefits
to any funeral director, undertaker, or undertaking business. Violation of this section is a Class 2
misdemeanor. This section does not prohibit an insurer from paying life insurance
or burial
insurance
benefits to a funeral director, undertaker, or undertaking business, whether or not an
assignment of the policy has been made pursuant to § 58-11-36, if the insurer makes the payment
pursuant to an assignment made by the beneficiary of the insurance benefits to a person or entity
which performed burial or funeral services for the insured or contracted after the death of the
insured to perform burial or funeral services for the insured. If the cost of the burial or funeral
services performed is less than the benefit amount to be paid under the life insurance
or burial
insurance
policy, the insurer shall pay the excess to the named beneficiary in accordance with the
terms of the contract.