Provides for establishment of child support lien against life insurance proceeds; requires insurers perform child support judgment search.
Impact
If enacted, S886 would directly impact the financial obligations of individuals who owe child support by placing a legal claim over life insurance and annuity proceeds that exceed any specified thresholds. By prioritizing the satisfaction of child support judgments over other levies or claims on these funds, the bill seeks to ensure that custodial parents receive support that may otherwise go unpaid due to the reluctance of some individuals to meet their obligations. The bill establishes that the proceeds from life insurance or annuities are subject to a lien, thus providing a tool for enforcement of child support.
Summary
Senate Bill 886 (S886) aims to establish a lien against the proceeds of life insurance policies and annuity contracts for individuals found to be child support judgment debtors. The primary goal of this legislation is to enhance the recovery of child support owed to custodial parents by ensuring that any funds from life insurance or annuity proceeds are not distributed to the beneficiary until the child support obligation is fulfilled. This bill specifically amends existing laws to clarify the treatment of such proceeds in this context and includes mechanisms for the insurance companies to conduct searches to identify outstanding child support obligations.
Contention
Some points of contention may arise regarding potential conflicts with beneficiaries' rights. Opponents could argue that this legislation undermines the intent of life insurance, which is meant to provide financial security for dependents. There may also be concerns from insurance companies regarding the administrative burden imposed by having to conduct child support judgment searches before disbursing funds. Critics may highlight the potential impacts on beneficiaries who are not the judgment debtors themselves, creating complex situations where funds intended for them could be withheld unjustly until legal obligations are satisfied.
Establishes separate class of claims against insolvent estates for child support judgments; modifies order for payment of claims by representative of insolvent estate.
Establishes separate class of claims against insolvent estates for child support judgments; modifies order for payment of claims by representative of insolvent estate.
Provides that Probation Division would file child support judgment as a lien only when amount of judgment equals or exceeds amount of child support due for a one-month period.
Provides that Probation Division would file child support judgment as a lien only when amount of judgment equals or exceeds amount of child support due for a one-month period.
Makes child support arrearages collectable anytime by public welfare or other social services board or agency against obligor or obligor's estate based on amount of public assistance provided due to obligor's failure to pay support.