2023 New York Laws › EPT - Estates, Powers and Trusts › Article 13 - Other Provisions Affecting Estates › Part 3 - Miscellaneous Provisions › 13-3.3 - Designation of Trustee to Receive Proceeds of Thrift, Savings, Pension, Retirement, Death Benefit, Stock Bonus and Profit-Sharing Plans, Systems or Tr

§ 13-3.3 Designation  of trustee to receive proceeds of thrift, savings,
pension,  retirement,  death   benefit,   stock   bonus   and
profit-sharing plans, systems or trusts, of life, group life,
industrial life or accident and health insurance policies and
of  annuity,  endowment and supplemental insurance contracts,
and taxation thereof
(a) The  proceeds  of  thrift,  savings,  pension,  retirement,  death
benefit,  stock  bonus  and  profit-sharing plans, systems or trusts, of
life, group life, industrial  life  or  accident  and  health  insurance
policies  and of annuity, endowment and supplemental insurance contracts
(hereinafter referred to as "proceeds") may be made payable to a trustee
designated as beneficiary in the manner prescribed by this  section  and
named as:
(1)  Trustee  under  a  trust  agreement  or  declaration  of trust in
existence at the date  of  such  designation,  and  identified  in  such
designation, and such proceeds shall be paid to such trustee and be held
and  disposed of in accordance with the terms of such trust agreement or
declaration of trust, including any amendments thereto, as  they  appear
in  writing  on  the  date  of  the  death  of  the insured, employee or
participant. It shall not be necessary to the validity of any such trust
agreement or declaration of trust that it have a trust corpus other than
the right of the trustee as beneficiary to receive such proceeds.
(2)  Trustee  of  a  trust  to  be  established  by  will,  and   upon
qualification and issuance of letters of trusteeship such proceeds shall
be  payable to the trustee to be held and disposed of in accordance with
the terms of such will as a testamentary trust. A designation  which  in
substance  names  as  such beneficiary the trustee under the will of the
insured, employee or participant, shall be taken to refer to the will of
such person actually admitted to probate,  whether  executed  before  or
after the making of such designation.
(b)  If  no qualified trustee claims such proceeds from the insurer or
other payor within eighteen months  after  the  death  of  the  insured,
employee or participant, or if satisfactory evidence is furnished to the
insurer  or other payor within such period showing that there is or will
be no trustee to receive such proceeds, such proceeds shall be  paid  by
the  insurer or other payor to the personal representative or assigns of
the insured, employee  or  participant,  unless  otherwise  provided  by
agreement  with  the  insurer  or other payor during the lifetime of the
insured, employee or participant.
(c) Except to the extent otherwise provided by  the  trust  agreement,
declaration of trust or will, proceeds received by the trustee shall not
be  subject to the debts of the insured, employee or participant, to any
greater extent than if such proceeds were payable to  the  beneficiaries
named  in  the  trust, and for all purposes including transfer or estate
tax purposes they shall not be deemed payable to or for the  benefit  of
the estate of the insured, employee or participant.
(d)  Proceeds so held in trust may be commingled with any other assets
which may properly become part of such trust.
(e)  Nothing  in  this  section  shall  effect  the  validity  of  any
designation  heretofore  made  of  the  trustee of any trust established
under a trust agreement or declaration of trust or by will.
(f) This section shall be construed as declaring the law as it existed
prior to its enactment and not as modifying it.