(a)

(1) Any individual of competent legal capacity may procure or effect an insurance contract upon his or her own life or body for the benefit of any person.

(2) However, no person shall procure or cause to be procured any insurance contract upon the life or body of another individual unless the benefits under the contract are payable to:

(A) The individual insured or his or her personal representatives; or

(B) A person having an insurable interest in the individual insured at the time the contract was made.

(b) If the beneficiary, assignee, or other payee under any contract made in violation of this section receives from the insurer any benefits thereunder accruing upon the death, disablement, or injury of the individual insured, the individual insured or his or her executor or administrator, as the case may be, may maintain an action to recover the benefits from the person so receiving them.

(c) (1) "Insurable interest" with reference to personal insurance includes only interests 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 persons to which subdivision (c)(1)(D) of this section does not apply, a lawful and substantial economic interest in having the life, health, or bodily safety of the individual insured continue, as distinguished from an interest that would arise only by, or would be enhanced in value by, the death, disablement, or injury of the individual insured;

(C) An individual party to a contract or option for the purchase or sale of an interest in a business partnership or firm, or of shares of stock of a closed corporation or of an interest in such shares, as an insurable interest in the life of each individual party to the contract and for the purposes of the contract only, in addition to any insurable interest that may otherwise exist as to the life of the individual; and

(D) (i) (a) Any employer, corporation, other business entity, or the trustee of a trust providing life, health, disability, retirement, or similar benefits to employees, retired employees, or their dependents or beneficiaries has an insurable interest in the lives of employees for whom the benefits are to be provided.

(b) Any employer, corporation, business entity, or trustee of a trust under subdivision (c)(1)(D)(i)(a) of this section may purchase, accept, or otherwise acquire an interest in personal insurance as a beneficiary or owner.

(ii)

(a) Employers have a lawful and substantial economic interest in the lives of key employees and in other employees who have a reasonable expectation of benefiting from a pension and welfare benefit plan.

(b) Any employer, corporation, business entity, or trustee under this subdivision (c)(1)(D) shall obtain the consent of any employee for which it obtained personal insurance, if the personal insurance purchased names the employer, corporation, business entity, or the trustee as a beneficiary.

(c) Consent required under subdivision (c)(1)(D)(ii)(b) of this section shall include an acknowledgement that the employer may maintain the life insurance coverage after the insured individual's employment has terminated.

(d) No employer, corporation, business entity, or trustee may lawfully retaliate against any person for refusing to consent to the issuance of insurance on that person.

(e) For a non-key or nonmanagerial employee, the amount of coverage shall be reasonably related to the benefits provided to the employee.

(f) The life insurance coverage purchased to finance employer-provided pension and welfare benefit plans shall be allowed only on the lives of those employees and retirees who have a reasonable expectation of benefiting from the plan at the time their lives are first insured under the plan.

(2)

(A) Notwithstanding any other law or regulation to the contrary, any religious, educational, charitable, or benevolent institution, organization, corporation, association, or trust, including, but not limited to, charitable remainder trusts, may be named beneficiary or owner, or both, of the policy or contract by any applicant for insurance upon his or her own life in any policy of life insurance issued by any life insurance company authorized to do business in this state or in the state of domicile of the applicant for insurance.

(B) The applicant for insurance shall be deemed to have an unlimited insurable interest in his or her own life, and is entitled to name any of the institutions as beneficiary of the insurance, and the beneficiaries or owners, or both, shall have the right to receive all death benefits provided for by such policies and to exercise the rights of ownership if granted same.

(C) As to any life insurance policies heretofore issued by insurers naming any of the institutions referred to in this section as beneficiaries or owners, or both, if the applicant for insurance was also the insured, the beneficiaries or owners shall be entitled to receive all death benefits provided by the policy and to exercise the rights of ownership if granted same.