Enrolled Bill Summary

House Bill 2240 enacts the Uniform Prudent Investor Act, which is based on the national act promulgated in 1994. The bill establishes the prudent investor rule, which provides that a trustee’s actions be judged based on what a prudent investor would do under certain circumstances and requires the performance of individual trust assets to be evaluated based on the performance of the trust portfolio as a whole and as part of an overall investment strategy. It requires diversification of investments unless the purposes of the trust are better served without diversifying; authorizes a trustee to delegate investment and management functions to an agent; and releases the trustee from liability for the actions or decisions of that agent.