AR HB1313

Amends Arkansas Code § 23-79-131(a)(1) to expand the definition of "proceeds and avails" from life insurance policies to include cash surrender value, policy proceeds, withdrawal values from optional settlements, and all other benefits and payments.

Extends exemptions from creditor claims to apply against garnishment, attachment, execution, seizure, legal or equitable process, and bankruptcy demands for both the insured and beneficiary.

Specifies exceptions where the exemption does not apply: pledges of policies to secure debt obligations, child support liens or levies, Department of Human Services claims against estates, and policies that become assets of the insured.

Clarifies that life insurance proceeds payable to beneficiaries other than the insured, including charitable organizations under 26 U.S.C. § 501(c)(3), for permitted business uses, or to the insured's spouse, children, or dependents are excluded from personal property limitations under Arkansas Constitution Article 9, § 2.

Approved April 11, 2023.