(a) Each insurer admitted to transact life insurance in this state shall pay interest on proceeds or payments under any individual policy of life insurance, payable to a beneficiary residing in this state or to a beneficiary under a policy issued in this state or to a beneficiary under a policy insuring a person resident in this state at the time of death.

(b) Interest payable pursuant to subsection (a) of this Code section shall be computed from the insured's death until the date of payment and shall be at the following rate of interest:

(1) In the event an action to recover the proceeds due under such policy is commenced and results in a judgment against the insurer, interest shall be computed at the legal rate of interest; or

(2) In the event no such action has been commenced, interest shall be computed daily at the greater of the rate of 6 percent per annum or the highest interest rate currently paid by the insurer on proceeds left under an interest settlement option; provided, however, that when a claim for the policy proceeds is filed with the insurer, interest shall be computed daily from 30 days after the date the claim is filed until the date of payment at the rate of 12 percent.

(c) This Code section shall not:

(1) Apply to proceeds under any such policy paid within 30 days after the date of death of the insured;

(2) Require the payment of interest in an amount of less than $5.00;

(3) Apply to policies of credit life insurance;

(4) Require the payment of interest for any period during which an insurer is required to pay interest under any state or federal law pertaining to interpleader; or

(5) Apply to any individual policy issued within 12 months of the death of the insured.

(d) For the purposes of this Code section, payment shall be deemed to have been received by a resident when manually delivered by an agent or representative of the insuring company or when deposited by the insuring company in the United States mail, postage prepaid, and directed to the resident at his last known address as evidenced by the business records of the insuring company.

(e)(1) For the purposes of this Code section, a claim shall be deemed to have been filed with an insurer on the date that the insurer receives a substantially completed application or other written notice for the policy proceeds and reasonable proof of death of the insured.

(2) In cases of group life insurance, a claim shall be deemed to have been filed on the date that the insurer receives the information provided in paragraph (1) of this subsection and receives from the group policyholder written evidence of eligibility for coverage.