TN
Tennessee House Bill HB1045

Tennessee 2025-2026 Regular Session

Tennessee House Bill HB1045 Compare Versions

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9-PUBLIC CHAPTER NO. 150
10-HOUSE BILL NO. 1045
11-By Representative Shaw
12-Substituted for: Senate Bill No. 1106
13-By Senator Kyle
14-AN ACT to amend Tennessee Code Annotated, Title 56, relative to creditor claims to
15-insurance proceeds.
1+
2+<BillNo> <Sponsor>
3+
4+HOUSE BILL 1045
5+By Shaw
6+
7+
8+HB1045
9+003107
10+- 1 -
11+
12+AN ACT to amend Tennessee Code Annotated, Title 56,
13+relative to creditor claims to insurance proceeds.
14+
1615 WHEREAS, the Tennessee Supreme Court has repeatedly advised that "each word in a
1716 statute has a specific purpose and meaning" in cases such as State v. Gevedon, 671 S.W.3d
1817 537 (Tenn. 2023), Arden v. Kozawa, 466 S.W.3d 758 (Tenn. 2015), Cunningham v. Williamson
1918 Cnty. Hosp. Dist., 405 S.W.3d 41 (Tenn. 2013), and Lee Med., Inc. v. Beecher, 312 S.W.3d 515
20-(Tenn. 201 O); and
19+(Tenn. 2010); and
2120 WHEREAS, certain members of the Tennessee bar and judiciary have questioned the
22-meaning of the phrase "for the benefit of' and, if this conduct continues, retirees will be
21+meaning of the phrase "for the benefit of" and, if this conduct continues, retirees will be
2322 discouraged from moving into Tennessee; and
24-WHEREAS, the phrase "for the benefit of' is used to indicate that something is done for
25-the advantage of someone or something. In finanoial and legal contexts, FBO stands for "for the
26-benefit of' and is often used in living trust documents or accounts with beneficiary designations;
27-and
23+WHEREAS, the phrase "for the benefit of" is used to indicate that something is done for
24+the advantage of someone or something. In financial and legal contexts, FBO stands for "for
25+the benefit of" and is often used in living trust documents or accounts with beneficiary
26+designations; and
2827 WHEREAS, per the Merriam-Webster dictionary, the plain definition of the word
2928 "beneficiary" is "the person named (as in an insurance policy or annuity) to receive the proceeds
3029 or benefits"; and
3130 WHEREAS, the definition of the word "all" has been questioned and restricted by certain
3231 members of the Tennessee bar and judiciary, despite the clear directive of the Tennessee
3332 Supreme Court to use the plain meaning of each word in a statute without restriction in
3433 decisions such as Lind v. Beaman Dodge, Inc., 356 S.W.3d 889 (Tenn. 2011), and if this
3534 conduct continues, retirees will be discouraged from moving into Tennessee; and
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3639 WHEREAS, per the Merriam-Webster dictionary, the plain definition of the word "all": as
3740 an adjective, is "the whole amount, quantity, or extent of; as much as possible; every member or
3841 individual component of; the whole number or sum of; every, any whatever, completely taken up
3942 with, given to, or absorbed by"; as a pronoun, is "the whole number, quantity or amount; totality,
4043 everybody, everything"; and as a noun, is "the whole of one's possessions, resources or
4144 energy"; and
42-WHEREAS, Black's Law Dictionary defines "all" as "the whole of -used with a singular
45+ WHEREAS, Black's Law Dictionary defines "all" as "the whole of – used with a singular
4346 noun or pronoun, and referring to the amount, quantity, extent, duration, quality or degree. The
44-whole number or sum of -used collectively, with a plural noun or pronoun expressing an
45-aggregate. Every member of an individual of (sic) individual component of; each one of -used
47+whole number or sum of – used collectively, with a plural noun or pronoun expressing an
48+aggregate. Every member of an individual of (sic) individual component of; each one of – used
4649 with a plural noun. In this sense, all is used generically and distributively (sic). 'All' refers rather
4750 to the aggregate under which the individuals are subsumed than to the individuals themselves.";
4851 and
4952 WHEREAS, Tennessee Code Annotated, Section 56-7-203, was introduced in 1925 and
5053 last modified in 1932, prior to the introduction of the "Personal Property Owner's Rights and
5154 Garnishment Act of 1978", compiled in Tennessee Code Annotated, Title 26, Chapter 2, Part 1;
5255 and
5356 WHEREAS, these questions bring uncertainty to Tennesseans trying to plan for
5457 retirement and may be a deciding factor among those seeking retirement in the Southeast when
55-choosing a state to which to retire; now, therefore, HB1045
58+choosing a state to which to retire; now, therefore,
5659 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
5760 SECTION 1. Tennessee Code Annotated, Section 56-7-203, is amended by deleting the
5861 section and substituting:
5962 The net amount payable under any policy of life insurance or under any annuity
6063 contract upon the life of any person made for the benefit of, or assigned to, the spouse
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65+
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6168 or children, or dependent relatives of the persons, is exempt from all claims of the
6269 creditors, including execution, attachment, seizure, and garnishment, of the person
6370 arising out of or based upon any obligation created after January 1, 1932, whether or not
64-the right to change the named beneficiary is reserved by or permitted to that person. Use
65-of exempt funds does not change the classification of the funds used from exempt to
66-nonexempt.
71+the right to change the named beneficiary is reserved by or permitted to that person.
72+Use of exempt funds does not change the classification of the funds used from exempt
73+to nonexempt.
6774 SECTION 2. This act takes effect July 1, 2025, the public welfare requiring it.
68-2 HOUSE BILL NO. 1045
69-PASSED: March 24, 2025
70-Q
71-CAMEROlrSEXTON,SPEAKER
72-HOUSE OF REPRESENTATIVES
73-RANDY M(INALL Y
74-SPEAKER OF THE SENATE
75-APPROVED this ::f' day of &r:j 2025
76-BILL LEE, GOVERNOR