HRS §557A-407
How insurance money is split between income and principal
This section says how money from insurance policies or similar contracts is divided between the trust's principal and its income. Generally, insurance proceeds go to principal, but some policies that protect income go to income. It also says how dividends on insurance policies are handled.
beneficiariestrustees
The statute, as written — Insurance policies and similar contracts
(a) Except as provided in subsection (b), proceeds from a life insurance policy or other contract whose beneficiary is the trust or its trustee, including a contract that insures the trust or its trustee against loss for the damage or destruction of, or loss of title to, a principal asset shall be allocated to principal. The trustee shall allocate dividends on an insurance policy to income if the premiums on the policy are paid from income, and to principal if the premiums are paid from principal. This section shall not apply to a contract to which section 557A-409 applies. (b) Insurance proceeds shall be allocated to income if they are from a policy that insures the trustee against the loss of occupancy or other use by an income beneficiary, the loss of income, or, subject to section 557A-403, the loss of profits from a business.
Sections this one refers to
§557A-403 Trustee can keep separate books for a business
§557A-409 How trust payments are split between income and principal
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