This bill amends New Jersey law to establish a child support lien against life insurance proceeds and other financial settlements exceeding $2,000. It mandates that insurers conduct a search for child support judgments before distributing these proceeds, ensuring that any outstanding child support obligations are prioritized. The lien will take precedence over other claims, except for unpaid state income taxes, and will delay the distribution of funds until the child support judgment is satisfied. The bill also clarifies the definition of "net proceeds" and outlines the responsibilities of parties involved in the distribution, including the requirement for certification of the beneficiary's status regarding child support judgments.

Additionally, the legislation addresses the proceeds of annuity contracts and life insurance policies when the insured or beneficiary is a child support judgment debtor. It establishes that a lien will be placed on these proceeds, preventing distribution until any child support judgment is satisfied. The bill includes provisions to protect insurers and attorneys from liability when complying with the new requirements and prohibits private judgment search companies from misusing information obtained during the search. The Commissioner of Banking and Insurance is tasked with adopting necessary regulations to implement the bill's provisions, ensuring a structured approach to handling child support obligations in financial settlements and insurance payouts.

Statutes affected:
Introduced: 2A:17-56.23