The bill amends Sections 27-14-3 and 27-15-8 of the Code of Alabama 1975 to correct internal citations and clarify provisions regarding insurable interest in personal insurance and life insurance policies. Key insertions include the specification that a trustee of a trust established by a certificate holder has an insurable interest in the life of a preneed contract purchaser or beneficiary, retroactively applying this provision to policies issued before May 6, 2008. Additionally, the bill clarifies that a charitable organization meeting the requirements of 26 U.S.C. § 501(c)(3) can own or purchase life insurance on an individual who consents, establishing that the organization has a substantial interest in the insured individual.

The bill also includes deletions of outdated references, such as changing "Chapter 17A" to "Article 5 of Chapter 13 of Title 34" and updating the language regarding the cash surrender value of policies. It mandates that insurers shall advance loans against policies with cash surrender value under specified conditions and outlines the rights of insurers regarding loan provisions. The act is set to take effect on June 1, 2025.

Statutes affected:
Introduced: 27-14-3, 27-15-8
Enrolled: 27-14-3, 27-15-8