Senate Bill 1106 amends Tennessee Code Annotated, Section 56-7-203, which pertains to the exemption of life insurance and annuity proceeds from creditor claims. The bill replaces the existing language with a new provision that clarifies that the net amount payable under any life insurance policy or annuity contract, when made for the benefit of or assigned to a spouse, children, or dependent relatives, is exempt from all creditor claims, including execution, attachment, seizure, and garnishment. This exemption applies to obligations created after January 1, 1932, regardless of whether the right to change the named beneficiary is reserved.

The bill aims to address uncertainties surrounding the interpretation of terms like "for the benefit of" and "all," which have been questioned by some members of the Tennessee bar and judiciary. By providing clear definitions and protections for retirement planning, the bill seeks to encourage retirees to consider Tennessee as a favorable state for relocation. The act is set to take effect on July 1, 2025.

Statutes affected:
Introduced: 56-7-203