(1) Notwithstanding s. 881.01, if a principal purpose of a trust is to hold a life insurance contract or to purchase a life insurance contract from contributions made to the trust, the trustee does not have a duty to determine whether the life insurance contract is or remains a proper investment of the trust. For purposes of this subsection, determining whether a life insurance contact is or remains a proper investment includes all of the following: (a) Investigating the financial strength or changes in the financial strength of the life insurance company maintaining the life insurance contract. (b) Determining whether to exercise any policy option, right, or privilege available under the life insurance contract. (c) Diversifying the life insurance contract relative to any other life insurance contracts or any other assets of the trust. (d) Inquiring about or investigating the health or financial condition of an insured. (e) Preventing the lapse of a life insurance contract if the trust does not receive contributions or hold other readily marketable assets to pay the life insurance contract premiums. (2) A trustee is not liable for a loss that arises because the trustee did not take an action specified in sub. (1). (4) This section does not apply to a trust that was executed before July 1, 2014, unless the trustee notifies the qualified beneficiaries that the trustee elects to be governed by this section and provides the qualified beneficiaries with a copy of this section. (5) Subject to sub. (4), this section applies to a life insurance contract acquired, retained, or owned by a trustee before, on, or after July 1, 2014.
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