Commonwealth Consolidated Acts Commonwealth Consolidated Acts(1) If, on the death of a person, money becomes payable to the person's estate under a policy effected on the person's life, the following provisions apply:
(a) except as permitted by paragraph (b), the money is not liable to be applied or made available:
(i) under any judgment, order or process of a court; or
(ii) in any other manner whatsoever;
in payment of the person's debts;
(b) the money may be applied in payment of a debt of the person if:
(i) the person had entered into a contract that provided expressly for the money to be so applied; or
(ii) the person had charged the money with the payment of the debt; or
(iii) the person gave an express direction, in his or her will or other testamentary document signed by the person, that the money be so applied;
(c) none of the following constitutes an express direction for the purposes of subparagraph (b)(iii):
(i) a mere direction that debts be paid;
(ii) a charge of debts on the whole or a part of the person's estate;
(iii) the creation of a trust for the payment of debts.
(2) This section has effect regardless of when a policy was issued.
(3) This section has effect subject to the Bankruptcy Act 1966 .