Maryland Insurance Section 8-402

      (a)      (1)      An incorporated society, order, or supreme lodge without capital stock is deemed to be a fraternal benefit society if it:

                  (i)      is conducted solely for the benefit of its members and their beneficiaries;

                  (ii)      is not conducted for profit;

                  (iii)      is operated on a lodge system with ritualistic form of work;

                  (iv)      has a representative form of government; and

                  (v)      provides for benefits to be paid in accordance with this subtitle.

            (2)      An incorporated or unincorporated society, order, or supreme lodge without capital stock that is exempted under § 8-404(a)(2) of this subtitle is deemed to be a fraternal benefit society.

      (b)      A society is deemed to be operating on a lodge system if it operates under a system by which the society:

            (1)      has a supreme legislative or governing body and subordinate lodges or branches, by whatever name known;

            (2)      by its laws, requires the subordinate lodges or branches to hold regular meetings at least once each month in furtherance of the purposes of the society; and

            (3)      elects, initiates, or admits members in accordance with its laws, rituals, and rules.

      (c)      A society is deemed to have a representative form of government if:

            (1)      (i)      the society provides in its laws for a supreme legislative or governing body composed of:

                        1.      representatives elected by the members of the society or by delegates elected directly or indirectly by the members; and

                        2.      any other individuals required by the laws of the society;

                  (ii)      election of delegates may be accomplished by mail;

                  (iii)      the elected representatives of the society:

                        1.      are a majority of the supreme legislative or governing body;

                        2.      have at least two-thirds of the votes; and

                        3.      have at least the number of votes required to amend the laws of the society;

                  (iv)      at least once every 4 years:

                        1.      the supreme legislative or governing body of the society meets; and

                        2.      officers, representatives, or delegates of the society are elected;

                  (v)      each insured member is eligible for election to act or serve as a delegate to the meeting;

                  (vi)      the society has a board of directors that:

                        1.      is responsible for the management of the affairs of the society between meetings of the supreme legislative or governing body;

                        2.      is subject to control by the supreme legislative or governing body;

                        3.      except when a vacancy is filled between meetings of the supreme legislative or governing body, is elected by the supreme legislative or governing body; and

                        4.      has powers and duties delegated by the laws of the society;

                  (vii)      the officers of the society are elected by the supreme legislative or governing body or by the board of directors; and

                  (viii)      the members, officers, representatives, or delegates of the society may not vote by proxy; or

            (2)      (i)      the society provides in its laws for a supreme legislative or governing body composed of:

                        1.      a board composed of individuals elected by the members, either directly or by their representatives in intermediate assemblies; and

                        2.      any other individuals required by the laws of the society;

                  (ii)      election of the board may be accomplished by mail;

                  (iii)      the term of an elected board member may not exceed 4 years;

                  (iv)      the individuals elected to the board:

                        1.      are a majority of the board; and

                        2.      have at least the number of votes required to amend the laws of the society;

                  (v)      vacancies on the board between elections are filled as prescribed by the laws of the society;

                  (vi)      an individual filling the unexpired term of an elected board member is considered to be an elected member; and

                  (vii)      the board meets at least quarterly to conduct the business of the society.