(a) Except as otherwise provided in paragraph (b), a trustee shall
allocate to principal the proceeds of a life insurance policy or other
contract in which the trust or its trustee is named as beneficiary,
including a contract that insures the trust or its trustee against loss
for damage to, destruction of, or loss of title to a trust asset. The
trustee shall allocate dividends on an insurance policy to income if the
premiums on the policy are paid from income, and to principal if the
premiums are paid from principal.
(b) A trustee shall allocate to income proceeds of a contract that
insures the trustee against loss of occupancy or other use by an income
beneficiary, loss of income, or, subject to 11-A-4.3, loss of profits
from a business.
(c) This section does not apply to a contract to which 11-A-4.9
applies.