(1) Life insurance may be made payable to a trustee to be named as beneficiary in the policy and the proceeds of such insurance shall be paid to such trustee and shall be held and disposed of by the trustee as provided in a trust agreement made by the insured during his lifetime. 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 to receive such insurance proceeds as beneficiary.

(2) A policy of life insurance may designate as beneficiary a trustee or trustees named by will. The proceeds of such insurance shall be payable to the trustee or trustees to be held and disposed of under the terms of the will as they exist as of the time of the death of the testator. If no such trustee makes claim to the proceeds from the insurance company within eighteen (18) months after the death of the insured, or if satisfactory evidence is furnished to the insurance company within such eighteen-month period showing that there is or will be no trustee to receive the proceeds, payment shall be made by the insurance company to the executors, administrators, or assigns of the insured, unless otherwise provided by agreement with the insurance company during the lifetime of the insured.

(3) The proceeds of the insurance as received by the trustee or trustees shall not be subject to debts of the insured nor to transfer or estate tax to any greater extent than if such proceeds were payable to the beneficiary or beneficiaries named in the trust and not to the estate of the insured.

(4) Such insurance proceeds so held in trust may be commingled with any other assets which may properly come into such trust.

(5) Nothing in this section shall affect the validity of any life insurance policy beneficiary designation heretofore made naming trustees of trusts established by living trust or by will.