CHAPTER 173

H.P. 1086 - L.D. 1481

An Act To Clarify Provisions Governing Corporate-owned

Life Insurance Policies

Be it enacted by the People of the State of Maine as follows:

Sec. 1. 24-A MRSA §2404, sub-§3, as amended by PL 1993, c. 320, §§1 and 2 and affected by §4, is further amended to read:

3. "Insurable interest" as to such personal insurance means that every individual has an insurable interest in the individual's own life, body, and health of himself, and of other persons that a person has an insurable interest in other individuals as follows:

A. In the case of individuals related closely by blood or by law, a substantial interest engendered by love and affection;

B. In the case of other persons, a lawful and substantial economic interest in having the life, health or bodily safety of the individual insured continue, as distinguished from an interest which would arise only by, or would be enhanced in value by, the death, disablement or injury of the individual insured;

C. A party to a contract or option for the purchase or sale, including a redemption, of an interest in a business proprietorship, partnership or firm, or of shares of stock of a corporation or of an interest in these shares, has an insurable interest in the life, body and health of each individual party to that contract or option, and for the