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2014 SESSION
Be it enacted by the General Assembly of Virginia:
1. That § 38.2-3115 of the Code of Virginia is amended and reenacted as follows:
§ 38.2-3115. Interest on life insurance and annuity contract proceeds.
A. If an action to recover the proceeds due under a life insurance policy or annuity contract results in a judgment against the insurer, interest on the judgment at the legal rate of interest shall be paid from (i) the date of presentation to the insurer of proof of death on a life insurance policy or annuity contract or (ii) the date of maturity of an endowment policy to the date judgment is entered.
B. If no action is brought, interest upon the principal sum
paid to the beneficiary or policyowner shall be computed daily at an annual
rate of 2 1/2 two and one-half percent or at the annual rate
currently paid by the insurer on proceeds left under the interest settlement
option, whichever is greater, commencing (i) from the date of death on a
life insurance policy or annuity contract claim and; (ii) from the
date of receipt of a completed claim form on a variable annuity contract claim;
or (iii) from the date of maturity of an endowment contract to the date of
payment. The interest shall be added to and become a part of the total sum
payable.
C. No insurer shall be required to pay interest computed under this section if the total interest is less than five dollars.
D. This section shall not apply to (i) credit life insurance for which the premium is paid wholly from funds of the creditor with no specific identifiable charge being made to insureds for the insurance and upon which post-death interest on the indebtedness is waived by the creditor in an amount at least equal to the amount of interest that would otherwise be payable under this section; (ii) credit life insurance payable in whole or in part to a creditor that is an affiliate, as defined in § 13.1-725, of the insurer and that does not charge interest on the indebtedness from the date of death of the insured; or (iii) policies or contracts issued prior to July 1, 1977, but shall apply to any renewals or reissues of group life insurance policies or contracts occurring after that date.