(a) If the expenses of the illness of the beneficiary are less than the funds held in trust or the beneficiary dies before the funds held in trust are depleted, any remaining balance shall be transferred to the contingent beneficiary.
(b) When the trust is established, the named beneficiary shall select the manner in which a contingent beneficiary shall be named. If the named beneficiary is a minor or is incompetent, the parent or guardian shall select the manner in which a contingent beneficiary shall be named. The selection of the contingent beneficiary shall be made as follows:
(1) An institution involved in research to find a cure for a catastrophic illness shall be named;
(2) An individual, if known, who suffers from a catastrophic illness and is in need of financial help for valid reimbursable medical expenses, as defined in § 35-11-105, shall be named; or
(3) The trustee shall be authorized to select:
(A) An institution involved in research to find a cure for a catastrophic illness; or
(B) An individual who suffers from a catastrophic illness whether the name of such individual is known at the death of the named beneficiary or comes to the attention of the trustee within one (1) year after the death of the named beneficiary. The selection of this individual by the trustee is not limited to an individual for whom a trust has been established at the bank or trust company. If an individual beneficiary cannot be named within one (1) year, the option in subdivision (b)(3)(A) shall automatically occur.
(c) Modification of the selection of the contingent beneficiary may be made before the death of the named beneficiary or before the disbursement of funds to the selected contingent beneficiary.
(d) The transfer to a contingent beneficiary shall occur as quickly as is reasonably feasible.
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