                                 CODE OF VIRGINIA

LIMITATION ON § 38.2-3118 (§ 38.2-3119)

A. The provisions of &#xA7; 38.2-3118 shall not apply to any proportionate part
of the proceeds of any such policy or supplemental contract mentioned in &#xA7;
38.2-3118 arising or resulting from premiums paid by the beneficiary. The
proportionate part of the proceeds shall be determined by comparing the total
premiums paid for the policy, without interest, with the premiums for the
policy, without interest, paid by the beneficiary.

B. Notwithstanding the other provisions of this section, an insurer who (i) has
no written notice of any claim that premiums have been paid by the beneficiary
and (ii) has no written notice of an adverse claim of any other character under
this section, shall be protected in making or withholding payments pursuant to
the terms of a policy or supplemental agreement.

C. Notwithstanding the other provisions of this section, upon an insurer&#8217;s
acceptance of proof that premiums have been paid by the beneficiary and the
insurer&#8217;s payment of the corresponding proportionate part of the proceeds
of the policy or supplemental agreement, the insurer&#8217;s payment shall
constitute full release of the insurer from all liability with respect to the
proportionate part of the proceeds of the policy or supplemental agreement.

HISTORY: Code 1950, § 38-116; 1952, c. 317, § 38.1-445; 1986, c. 562.