(1) Proceeds of a life insurance policy shall become due as of the date of the death of the insured. Each insurer admitted to transact life insurance in this state shall pay interest on proceeds or payments under any policy of life insurance payable to a beneficiary residing in this state or to a beneficiary under a policy issued in this state or to a beneficiary under a policy insuring a person resident in this state at the time of death.
(2) Interest payable under subsection (1) of this section shall be computed from the insured’s death until the date of payment and shall be computed at the rate of interest guaranteed by the policy or at the current rate of interest applicable to death proceeds left on deposit with the insurer under an interest settlement option or at the current rate of interest payable on dividends left on deposit with the insurer, whichever is greater.
(3) This section shall be applicable to any such policy where proceeds have not been paid and accepted before May 14, 2004.
(4) This section shall not apply:
(a) When the total death proceeds payable by an insurer on account of the death of an insured person is less than Five Thousand Dollars ($5,000.00); or
(b) When death proceeds result from insurance written under Section 83-53-1 et seq.
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