KRS 386.476: Receipts from insurance policies and similar contracts--Exception.

(1) Except as otherwise provided in subsection (2) of this section, 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.

(2) 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

loss of profits from a business.

(3) This section shall not apply to a contract to which KRS 386.480 applies.