Be it enacted by the General Assembly of Virginia:

1.  That § 51.1-511 of the Code of Virginia is amended and reenacted as follows:

§51.1-511. Persons entitled to payment of insurance on employee's or retiree's death.

A. Any amount of group life, insurance or accidental death, and dismemberment insurance in force on any employee or any amount of group life insurance in force on any retiree at the date of his death shall be paid, upon the establishment of a valid claim therefor, to the beneficiary designated by the employee or retiree under the provisions of the Virginia Retirement System or other retirement system administered by the Board, unless the employee or retiree has designated and filed with the Board on a form prepared by the Board, a different beneficiary of his group life, insurance or accidental death, and dismemberment insurance. If no beneficiary has been designated by the employee, or if the death of the designated person occurs prior to the death of the member and another designation has not been made, the proceeds shall be paid to the persons surviving at the date of his death, in the same order of precedence as set forth in subsection A of §51.1-162.

B. A retiree may make an irrevocable beneficiary designation of a portion of his group life insurance proceeds payable to purchase or secure funeral services, and services related to interment, cremation, or other means of disposition, in an amount not to exceed the group life insurance provided pursuant to § 51.1-505 that would be in force on the retiree after the maximum reduction pursuant to subsection B of such section.

C. Payment which otherwise would be made to the estate of an employee may be made in accordance with the provisions of §51.1-164.