US Laws, Codes, Statutes & Cases

                                  TITLE  41
                                  INSURANCE
                                  CHAPTER 32
                         FRATERNAL BENEFIT SOCIETIES
    41-3210.  ORGANIZATION. A domestic society organized on or after the
effective date of this act shall be formed as follows:
    (1)  Seven (7) or more citizens of the United States, a majority of whom
are citizens of this state, who desire to form a fraternal benefit society,
may make, sign and acknowledge before some officer competent to take
acknowledgment of deeds, articles of incorporation, in which shall be stated:
    (a)  The proposed corporate name of the society, which shall not so
    closely resemble the name of any society or insurance company as to be
    misleading or confusing;
    (b)  The purposes for which it is being formed and the mode in which its
    corporate powers are to be exercised. Such purposes shall not include more
    liberal powers than are granted in this chapter;
    (c)  The names and residences of the incorporators and the names,
    residences and official titles of all the officers, trustees, directors,
    or other persons who are to have and exercise the general control of the
    management of the affairs and funds of the society for the first year or
    until the ensuing election at which all such officers shall be elected by
    the supreme governing body, which election shall be held not later than
    one (1) year from the date of issuance of the permanent certificate of
    authority.
    (2)  Such articles of incorporation, duly certified copies of the
society's bylaws and rules, copies of all proposed forms of certificates,
applications therefor, and circulars to be issued by the society and a bond
conditioned upon the return to applicants of the advanced payments if the
organization is not completed within one (1) year shall be filed with the
director, who may require such further information as the director deems
necessary.  The bond with sureties approved by the director shall be in such
amount, not less than three hundred thousand dollars ($300,000), nor more than
one million five hundred thousand dollars ($1,500,000), as required by the
director.  All documents filed are to be in the English language.  If the
purposes of the society conform to the requirements of this chapter and all
provisions of the law have been complied with, the director shall so certify,
retain and file the articles of incorporation and shall furnish the
incorporators a preliminary certificate of authority authorizing the society
to solicit members as hereinafter provided.
    (3)  No preliminary certificate of authority granted under the provisions
of this section shall be valid after one (1) year from its date or after such
further period, not exceeding one (1) year, as may be authorized by the
director upon cause shown, unless the five hundred (500) applicants
hereinafter required have been secured and the organization has been completed
as herein provided.  The charter and all other proceedings thereunder shall
become null and void in one (1) year from the date of the preliminary
certificate of authority, or at the expiration of the extended period, unless
the society shall have completed its organization and received a certificate
of authority to do business as hereinafter provided.
    (4)  Upon receipt of a preliminary certificate of authority from the
director, the society may solicit members for the purpose of completing its
organization, shall collect from each applicant the amount of not less than
one (1) regular monthly premium in accordance with its table of rates, and
shall issue to each such applicant a receipt for the amount so collected. No
society shall incur any liability other than for the return of such advance
premium, nor issue any certificate, nor pay, allow, or offer or promise to pay
or allow, any benefit to any person until:
    (a)  Actual bona fide applications for benefits have been secured on not
    less than five hundred (500) applicants, and any necessary evidence of
    insurability has been furnished to and approved by the society;
    (b)  At least ten (10) subordinate lodges have been established into which
    the five hundred (500) applicants have been admitted;
    (c)  There has been submitted to the director, under oath of the president
    or secretary, or corresponding officer of the society, a list of such
    applicants, giving their names, addresses, date each was admitted, name
    and number of the subordinate lodge of which each applicant is a member,
    amount of benefits to be granted and premiums therefor; and
    (d)  It shall have been shown to the director, by sworn statement of the
    treasurer, or corresponding officer of such society, that at least five
    hundred (500) applicants have each paid in cash at least one (1) regular
    monthly premium as herein provided, which premiums in the aggregate shall
    amount to at least one hundred fifty thousand dollars ($150,000).  Said
    advance premiums shall be held in trust during the period of organization
    and if the society has not qualified for a certificate of authority within
    one (1) year, as herein provided, such premiums shall be returned to said
    applicants.
    (5)  The director may make such examination and require such further
information as the director deems advisable. Upon presentation of satisfactory
evidence that the society has complied with all the provisions of law, the
director shall issue to the society a certificate of authority to that effect
and that the society is authorized to transact business pursuant to the
provisions of this chapter.  The certificate of authority shall be prima facie
evidence of the existence of the society at the date of such certificate.  The
director shall cause a record of such certificate of authority to be made. A
certified copy of such record may be given in evidence with like effect as the
original certificate of authority.
    (6)  Any incorporated society authorized to transact business in this
state at the time this act becomes effective shall not be required to
reincorporate.