2009 Iowa Code
Title 13 - Commerce
Subtitle 1 - Insurance and Related Regulation
CHAPTER 512B - FRATERNAL BENEFIT SOCIETIES
512B.19 - THE BENEFIT CONTRACT.

        512B.19  THE BENEFIT CONTRACT.
         1.  A society authorized to do business in this state shall issue
      to each owner of a benefit contract a certificate specifying the
      amount of benefits provided pursuant to the benefit contract.  The
      certificate, together with any riders or endorsements attached to the
      certificate, the laws of the society, the application for membership,
      the application for insurance and declaration of insurability, if
      any, signed by the applicant, and all amendments, constitute the
      benefit contract, as of the date of issuance, between the society and
      the owner, and the certificate shall so state.  A copy of the
      application for insurance and declaration of insurability, if any,
      shall be endorsed upon or attached to the certificate.  Statements on
      the application are representations and not warranties.  A waiver of
      this provision is void.
         2.  Additions or amendments to the laws of a society duly made or
      enacted subsequent to the issuance of the certificate, bind the owner
      and the beneficiaries, and govern and control the benefit contract in
      all respects the same as though the additions or amendments had been
      made before and were in force at the time of the application for
      insurance, except that an addition or amendment shall not destroy or
      diminish benefits which the society contracted to give the owner as
      of the date of issuance.
         3.  A person upon whose life a benefit contract is issued before
      the person attains the age of majority is bound by the terms of the
      application and certificate and by all the laws and regulations of
      the society to the same extent as though the person had attained the
      age of majority at the time of application.
         4.  A society shall provide in its laws that if its reserves as to
      all or any class of certificates become impaired, its supreme
      governing body or board of directors may require that there be paid
      by the owners to the society the amount of the owners' equitable
      proportion of the deficiency as ascertained by its governing body or
      board, and that if the payment is not made either of the following
      will apply:
         a.  The required payment or assessment shall stand as an
      indebtedness against the certificate and draw interest not to exceed
      the rate specified for certificate loans under the certificates.
         b.  In lieu of or in combination with paragraph "a", the
      owner may accept a proportionate reduction in benefits under the
      certificate.
         The society may specify the manner of the election and which
      alternative is to be presumed if no election is made.
         5.  Copies of any of the documents mentioned in this section,
      certified by the secretary or corresponding officer of the society,
      shall be received in evidence of the terms and conditions of the
      documents.
         6.  A certificate shall not be delivered or issued for delivery in
      this state unless a copy of the form has been filed with the
      commissioner in the manner provided for like policies issued by life
      insurers in this state.  A life, accident, health, or disability
      insurance certificate and an annuity certificate issued on or after
      one year from January 1, 1991, shall meet the standard contract
      provision requirements not inconsistent with this chapter for like
      policies issued by life insurers in this state, except that a society
      may provide for a grace period for payment of premiums of one full
      month in its certificates.  The certificate shall also contain a
      provision stating the amount of premiums which are payable under the
      certificate and a provision reciting or setting forth the substance
      of any sections of the society's laws or regulations in force at the
      time of issuance of the certificate which, if violated, will result
      in the termination or reduction of benefits payable under the
      certificate.  If the laws of the society provide for expulsion or
      suspension of a member, the certificate shall also contain a
      provision that any member expelled or suspended, except for
      nonpayment of a premium or within the contestable period for material
      misrepresentation in the application for membership or insurance, may
      maintain the certificate in force by continuing payment of the
      required premium.
         7.  A benefit contract issued on the life of a person below the
      society's minimum age for adult membership may provide for transfer
      of control of ownership to the insured at an age specified in the
      certificate.  A society may require approval of an application for
      membership in order to effect this transfer, and may provide in all
      other respects for the regulation, government, and control of such
      certificates and the rights, obligations, and liabilities incident
      to, or connected with, the benefit contract.  Ownership rights prior
      to a transfer shall be specified in the certificate.
         8.  A society may specify the terms and conditions on which
      benefit contracts may be assigned.  

         90 Acts, ch 1148, §20
         Referred to in § 512B.2, 512B.22