304.29-101 Organization.
A domestic society organized on or after January 1, 1989, 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. The purposes shall not include more liberal
powers than are granted by this subtitle; and
(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) The 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 commissioner, who may require further information. The bond with
sureties approved by the commissioner shall be in an amount, not less than three
hundred thousand dollars (0,000) nor more than one million five hundred
thousand dollars (,500,000), as required by the commissioner. All documents
filed shall be in the English language. If the purposes of the society conform to the
requirements of this subtitle and all provisions of the law have been complied with,
the commissioner shall so certify, retain and file the articles of incorporation and
furnish the incorporators a preliminary certificate of authority authorizing the
society to solicit members;
(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 commissioner upon cause
shown, unless the five hundred (500) applicants hereinafter required have been
secured and the organization has been completed as herein provided. The articles of
incorporation 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;
(4) Upon receipt of a preliminary certificate of authority from the commissioner, the
society may solicit members for the purpose of completing its organization, shall
(5)
(6)
(7)
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 applicant a
receipt for the amount so collected. No society shall incur any liability other than for
the return of 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 commissioner, under oath of the president or
secretary, or corresponding officer of the society, a list of the 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 commissioner, by sworn statement of the
treasurer, or corresponding officer of the society, that at least five hundred
(500) applicants have each paid in cash at least one (1) regular monthly
premium, which premiums in the aggregate shall amount to at least one
hundred fifty thousand dollars (0,000). The 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, the premiums shall
be returned to the applicants;
The commissioner may make examination and require further information as he or
she deems advisable. Upon presentation of satisfactory evidence that the society has
complied with all the provisions of law, the commissioner 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 KRS Chapter 304. The certificate of authority
shall be prima facie evidence of the existence of the society at the date of the
certificate. The commissioner shall cause a record of the certificate of authority to
be made. A certified copy of the record may be given in evidence with like effect as
the original certificate of authority;
Any incorporated society authorized to transact business in this state at the time this
subtitle becomes effective shall not be required to reincorporate; and
No unincorporated or voluntary association shall be permitted to transact business
in this state as a fraternal benefit society.
Effective: July 15, 2010
History: Amended 2010 Ky. Acts ch. 24, sec. 1391, effective July 15, 2010. -- Created
1988 Ky. Acts ch. 310, sec. 10, effective January 1, 1989.
Disclaimer: These codes may not be the most recent version. Kentucky may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.