2023 Illinois Compiled Statutes › Chapter 215 - INSURANCE › 215 ILCS 5/ - Illinois Insurance Code. › Article XVII - Fraternal Benefit Societies

(215 ILCS 5/Art. XVII heading)
ARTICLE XVII.  
		FRATERNAL BENEFIT SOCIETIES
(Article scheduled to be repealed on January 1, 2027)
(215 ILCS 5/282.1) (from Ch. 73, par. 894.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 282.1. 
		Fraternal benefit societies. 
		Any incorporated society,
order or supreme lodge without capital stock, including one exempted under
the provisions of Section 315.5(a) of this amendatory Act whether incorporated or
not, organized solely for the benefit of its members and their
beneficiaries and not for profit, operated on a lodge system with
ritualistic form of work, having a representative form of government and
providing benefits in accordance with this amendatory Act is hereby declared
to be a fraternal benefit society.
(Source: P.A. 84-303.)
(215 ILCS 5/283.1) (from Ch. 73, par. 895.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 283.1. 
		Lodge system.
(a) A society is operating on the lodge
system if it has a supreme governing body and subordinate lodges into which
members are elected, initiated or admitted in accordance with its laws,
rules and ritual. Subordinate lodges shall be required by the laws of the
society to hold regular meetings at least once in each month in furtherance
of the purposes of the society.
(b) A society may, at its option, organize and operate lodges for
children under the minimum age for adult membership. Membership and
initiation in local lodges shall not be required of such children nor
shall they have a voice or vote in the management of the society.
(Source: P.A. 84-303.)
(215 ILCS 5/284.1) (from Ch. 73, par. 896.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 284.1. 
		Representative form of government. 
		A society has a
representative form of government when:
(a) It has a supreme governing body constituted in     one of the following ways:
(1) Assembly. The supreme governing body is an         assembly composed of delegates elected directly by the members or at intermediate assemblies of members or their representatives, together with other delegates as may be prescribed in the society's laws. A society may provide for election of delegates by mail. The elected delegates shall constitute a majority in number and shall not have less than 2/3 of the votes and not less than the number of votes required to amend the society's laws. The assembly shall be elected and shall meet at least once every 4 years and shall elect a board of directors to conduct the business of the society between meetings of the assembly. Vacancies on the board of directors between elections may be filled in the manner prescribed by the society's laws; or
(2) Direct Election. The supreme governing body         is a board composed of persons elected by the members, either directly or by their representatives in intermediate assemblies, and any other persons prescribed in the society's laws. A society may provide for election of the board by mail. Each term of a board member may be filled in the manner prescribed by the society's laws. However, those persons elected to the board shall constitute a majority in number and not less than the number of votes required to amend the society's laws. A person filling the unexpired term of an elected board member shall be considered to be an elected member. The board shall meet at least quarterly to conduct the business of the society;
(b) The officers of the society are elected either by     the supreme governing body or by the board of directors;
(c) Only benefit members are eligible for election to     the supreme governing body, the board of directors or any intermediate assembly; and
(d) Each voting member has one vote; no vote may be     cast by proxy.
(Source: P.A. 84-303.)
(215 ILCS 5/285.1) (from Ch. 73, par. 897.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 285.1. 
		Definitions. 
		Whenever used in this amendatory Act:
(a) "Benefit contract" shall mean the agreement for provision of
benefits authorized by Section 297.1 of this amendatory Act as that agreement is
described in Section 300.1 of this amendatory Act;
(b) "Benefit member" shall mean an adult member who is designated by the
laws or rules of the society to be a benefit member under a benefit contract;
(c) "Certificate" shall mean the document issued as written evidence of
the benefit contract;
(d) "Premiums" shall mean premiums, rates, dues or other required
contributions, by whatever name known, which are payable under the certificate;
(e) "Laws" shall mean the society's articles of incorporation,
constitution and bylaws, however designated;
(f) "Life insurer" shall mean an insurance company authorized to
transact in this State the insurance business classified as Class 1, Clause
(a) or (b) in Section 4 of this Code;
(g) "Rules" shall mean all rules, regulations or resolutions adopted by
the supreme governing body or board of directors which are intended to
have general application to the members of the society;
(h) "Society" shall mean fraternal benefit society, unless otherwise indicated; and
(i) "Lodge" shall mean subordinate member units of the society, known as
camps, courts, councils, branches or by any other designation.
(Source: P.A. 84-303.)
(215 ILCS 5/286.1) (from Ch. 73, par. 898.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 286.1. Purposes and powers.
(a) A society shall operate for the
benefit of members and their beneficiaries by:
(1) Providing benefits as specified in Section 297.1     of this amendatory Act; and
(2) Operating for one or more social, intellectual,     educational, charitable, benevolent, moral, fraternal, patriotic or religious purposes for the benefit of its members, which may also be extended to others. Such purposes may be carried out directly by the society or indirectly through subsidiary corporations or affiliated organizations.
(b) Every society shall have the power to adopt laws and rules for the
government of the society, the admission of its members and the management
of its affairs. It shall have the power to change, alter, add to or amend
such laws and rules and shall have such other powers as are necessary and
incidental to carrying into effect the objects and purposes of the society.
(c) A domestic  society that provides any of the benefits specified in Section 297.1 of this Code must be governed by a board of directors and managed by qualified officers subject to the following requirements:
(1) The laws of a society must provide that:
(i) the board of directors shall have the powers         and perform the duties ordinarily possessed and exercised by a board of directors under this Code, including, but not limited to, the authority and responsibility for the hiring and the discharge of a president, chief executive officer, or an equivalent position, except that a society that elects its president, chief executive officer, or equivalent position pursuant to its by-laws, as of the effective date of this amendatory Act of the 98th General Assembly, may continue to do so if it elects a president, chief executive officer, or equivalent position that meets qualifications set forth in a rule adopted by the Director; and
(ii) the board of directors may remove a director         for cause and replace the director with another qualified director.
After the effective date of this amendatory Act of     the 98th General Assembly, a domestic society shall amend its laws, as necessary, to comply with this paragraph (1) as soon as reasonably practicable, but in no event later than January 1, 2019.
(2) A person convicted of a felony may not be a     director or an officer of a domestic society.
(3) A society shall provide information regarding     qualifications of board candidates to voting members prior to the time of election.
(4) Each newly elected director of a domestic society     shall participate in a board training or orientation program within 6 months after their election to the board that includes information regarding board duties and responsibilities.
(5) At least annually, the board of directors shall     conduct a self-assessment.
(6) Each domestic society shall establish an audit     committee.  The composition and responsibilities of the audit committee shall comply with the Illinois Administrative Code provisions relating to annual financial reporting. (Source: P.A. 98-814, eff. 1-1-15.)
(215 ILCS 5/287.1) (from Ch. 73, par. 899.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 287.1. 
		Qualifications for membership.
(a) A society shall specify
in its laws or rules:
(1) eligibility standards for each and every class of     membership, provided that if benefits are provided on the lives of children, the minimum age for adult membership shall be set at not less than age 15 and not greater than age 21;
(2) the process for admission to membership for each     membership class; and
(3) the rights and privileges of each membership     class, provided that only benefit members shall have the right to vote on the management of the insurance affairs of the society.
(b) A society may also admit social members who shall have no voice or
vote in the management of the insurance affairs of the society.
(c) Membership rights in the society are personal to the member and are
not assignable.
(Source: P.A. 84-303.)
(215 ILCS 5/288.1) (from Ch. 73, par. 900.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 288.1. 
		Location of office, meetings, communications to members,
grievance procedures.
(a) The principal office and place of business of any
domestic society shall be located in this State. The meetings of its
supreme governing body may be held in any state, district, province or
territory wherein such society has at least one subordinate lodge, or in
such other location as determined by the supreme governing body, and all
business transacted at such meeting shall be as valid in all respects as if
such meetings were held in this State. The minutes of the proceedings of
the supreme governing body and of the board of directors shall be in the English language.
(b)(1) A society may provide in its laws for an official publication in
which any notice, report or statement required by law to be given to
members, including notice of election, may be published. Such required
reports, notices and statements shall be printed conspicuously in the
publication. If the records of a society show that 2 or more members have
the same mailing address, an official publication mailed to one member
is deemed to be mailed to all members at the same address unless a member
requests a separate copy.
(2) Not later than June 1 of each year, a synopsis of the society's
annual statement providing an explanation of the facts concerning the
condition of the society thereby disclosed shall be printed and mailed to
each benefit member of the society or, in lieu thereof, such synopsis may
be published in the society's official publication.
(c) A society may provide in its laws or rules for grievance or complaint
procedures for members.
(Source: P.A. 84-303.)
(215 ILCS 5/289.1) (from Ch. 73, par. 901.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 289.1. 
		Personal liability.
(a) The officers and members of the
supreme governing body or any subordinate body of a society shall not be
personally liable for any benefits provided by a society.
(b) Any person may be indemnified and reimbursed by any society for
expenses reasonably incurred by, and liabilities imposed upon, such person
in connection with or arising out of any action, suit or proceeding,
whether civil, criminal, administrative or investigative, or threat
thereof, in which the person may be involved by reason of the fact that he
or she is or was a director, officer, employee or agent of the society or
of any firm, corporation or organization which he or she served in any
capacity at the request of the society. A person shall not be so
indemnified or reimbursed (1) in relation to any matter in such action,
suit or proceedings as to which he or she shall finally be adjudged to be
or have been guilty of breach of a duty as a director, officer, employee or
agent of the society; or (2) in relation to any matter in such action, suit
or proceeding, or threat thereof, which has been made the subject of a
compromise settlement; unless in either such case the person acted in good
faith for a purpose the person reasonably believed to be in or not opposed
to the best interests of the society and, in a criminal action or
proceeding, in addition, had no reasonable cause to believe that his or her
conduct was unlawful. The determination whether the conduct of such person
met the standard required in order to justify indemnification and
reimbursement in relation to any matter described in subpoints (1) or (2)
of the preceding sentence may only be made by the supreme governing body or
board of directors by a majority vote of a quorum consisting of persons who
were not parties to such action, suit or proceeding or by a court of
competent jurisdiction. The termination of any action, suit or proceeding
by judgment, order, settlement, conviction or upon a plea of no contest
as to such person shall not in itself create a conclusive presumption that
the person did not meet the standard of conduct required in order to
justify indemnification and reimbursement. The foregoing right of
indemnification and reimbursement shall not be exclusive of other rights to
which such person may be entitled as a matter of law and shall inure to the
benefit of his or her heirs, executors and administrators.
(c) A society shall have power to purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or agent
of the society, or who is or was serving at the request of the society as a
director, officer, employee or agent of any other firm, corporation or
organization against any liability asserted against such person and
incurred by him or her in any such capacity or arising out of his or her
status as such, whether or not the society would have the power to
indemnify the person against such liability under this Section.
(Source: P.A. 84-303.)
(215 ILCS 5/290.1) (from Ch. 73, par. 902.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 290.1. 
		Waiver. 
		The laws of the society may provide that no
subordinate body, nor any of its subordinate officers or members, shall have
the power or authority to waive any of the provisions of the laws of the
society. Such provisions shall be binding on the society and every member
and beneficiary of a member.
(Source: P.A. 84-303.)
(215 ILCS 5/291.1) (from Ch. 73, par. 903.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 291.1. Organization. A domestic society organized on or after
January 1, 1986 (the effective date of Public Act 84-303) shall be formed as follows:
(a) Seven 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 acknowledgement of deeds, articles of incorporation, in which shall be stated:
(1) The proposed corporate name of the society,         which shall not so closely resemble the name of any society or insurance company already authorized to transact business in this State as to be misleading or confusing;
(2) The place where its principal office shall be         located within this State;
(3) 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 by this amendatory Act; and
(4) 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 year from the date of issuance of the permanent certificate of authority;
(b) Duplicate originals of the articles of     incorporation, certified copies of the society's bylaws and rules, copies of all proposed forms of certificates, applicants and rates 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 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 $300,000 nor more than $1,500,000, as required by the Director. All documents filed are to be in the English language. If the Director finds that the purposes of the society conform to the requirements of this amendatory Act and all provisions of the law have been complied with, the Director shall approve the articles of incorporation and issue the incorporators a preliminary certificate of authority authorizing the society to solicit members as hereinafter provided;
(c) No preliminary certificate of authority issued     under the provisions of this Section shall be valid after one year from its date of issue or after such further period, not exceeding one year, as may be authorized by the Director, upon cause shown, unless the 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 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;
(d) 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 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:
(1) Actual bona fide applications for benefits         have been secured on not less than 500 applicants and any necessary evidence of insurability has been furnished to and approved by the society;
(2) At least 10 subordinate lodges have been         established into which the 500 applicants have been admitted;
(3) 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;
(4) It shall have been shown to the Director, by         sworn statement of the treasurer or corresponding officer of such society, that at least 500 applicants have each paid in cash at least one regular monthly premium as herein provided, which premiums in the aggregate shall amount to at least $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 year unless extended by the Director, as herein provided, such premiums shall be returned to said applicants; and
(5) In the case of a domestic society that is         organized after January 1, 2015 (the effective date of Public Act 98-814), the society meets the following requirements:
(i) maintains a minimum surplus of             $2,000,000, or such higher amount as the Director may deem necessary; and
(ii)  meets any other  requirements as             determined by the Director.
(e) The Director may make such examination and     require such further information as the Director deems necessary. 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 amendatory Act; and
(f) Any incorporated society authorized to transact     business in this State at the time Public Act 84-303 becomes effective (January 1, 1986) shall not be required to reincorporate.
(Source: P.A. 102-558, eff. 8-20-21.)
(215 ILCS 5/292.1) (from Ch. 73, par. 904.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 292.1. 
		Amendments to Laws.
(a) A domestic society may amend its laws in
accordance with the provisions thereof by action of its supreme governing body
at any regular or special meeting thereof or, if its laws so provide, by
referendum. Such referendum may be held in accordance with the provisions
of its laws by the vote of the voting members of the society, by the vote
of delegates or representatives of voting members or by the vote of local
lodges. A society may provide for voting by mail. No amendment submitted for
adoption by referendum shall be adopted unless, within 6 months from the
date of submission thereof, a majority of the members voting shall have
signified their consent to such amendment by one of the methods herein
specified.
(b) No amendment to the laws of any domestic society shall
take effect unless approved by the Director, who shall approve such
amendment if the Director finds that it has been duly adopted and is not
inconsistent with any requirement of the laws of this State or with the
character, objects and purposes of the society. Unless the Director shall
disapprove any such amendment within 60 days after the filing of same,
such amendment shall be considered approved. The approval or disapproval of
the Director shall be in writing and mailed to
the society. In case the
Director disapproves such amendment, the reasons therefor shall be stated
in such written notice.
(c) Within 90 days from the approval thereof by the Director, all
such amendments, or a synopsis thereof, shall be furnished to all members
of the society either by mail or by publication in full in the official
publication of the society. The affidavit of any officer of the society or
of anyone authorized by it to mail any amendments or synopsis thereof,
stating facts which show that same have been duly addressed and mailed,
shall be prima facie evidence that such amendments, or a synopsis thereof,
have been furnished the addressee.
(d) Every foreign or alien society authorized to do business in this
State shall file with the Director a certified copy of all amendments of, or
additions to, its laws within 90 days after the enactment of same.
(e) Printed copies of the laws as amended, certified by the secretary or
corresponding officer of the society, shall be prima facie evidence of the
legal adoption thereof.
(Source: P.A. 84-303.)
(215 ILCS 5/293.1) (from Ch. 73, par. 905.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 293.1. 
		Institutions. 
		A society may create, maintain and operate, or
may establish organizations to operate, not for profit institutions to
further the purposes permitted by Section 286.1 of this amendatory Act. Such
institutions may furnish services free or at a reasonable charge. Any real
or personal property owned, held or leased by the society for this purpose
shall be reported in every annual statement. Admitted asset status of such
real or personal property shall be in accordance with Section 302.1 of this
amendatory Act.
(Source: P.A. 84-303.)
(215 ILCS 5/294.1) (from Ch. 73, par. 906.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 294.1. Reinsurance.
(a) A domestic society may enter into reinsurance
transactions only in accordance with Article XI of this Code.
(b)  A domestic society may reinsure the risks of another society in connection with a merger transaction with approval by the Director.
(Source: P.A. 98-814, eff. 1-1-15.)
(215 ILCS 5/295.1) (from Ch. 73, par. 907.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 295.1. 
		Consolidations and mergers. 
		A domestic society may enter
into agreements of consolidation or merger only in  accordance with Article
X of this Code.
(Source: P.A. 84-303.)
(215 ILCS 5/295.2)
(Section scheduled to be repealed on January 1, 2027)
Sec. 295.2. Maintenance of solvency.
(a) In the event a domestic society has an authorized control level event described in Section 35A-25 of this Code under circumstances the Director determines will not be promptly remedied, the Director may, in addition to all other actions required or permitted by subsection (b) of Section 35A-25 of this Code, issue an order declaring the domestic society to be in hazardous condition and ordering that all steps be taken to remedy such condition pursuant to this Section.
(b) A domestic society may negotiate an agreement to transfer  members, certificates, and other assets and liabilities of the society, in whole or in part, to another organization through merger, consolidation, assumption, or other means.  Such transfer shall be concluded within the timeframe established by the Director and subject to approval by the Director.  Such transfer agreement shall be deemed fully approved by the domestic society upon majority vote of its board of directors.  Such transfer shall be effective notwithstanding the provisions of Section 295.1 of this Code or any other law or regulation or laws of the domestic society requiring another form of notice to or approval by members, which shall be superseded by this Section.
(c) In the event of an agreement to transfer under this Section to an organization without a certificate of authority in this State, the Director may grant a limited certificate of authority to such organization, upon request, if the organization does not apply for and obtain a certificate of authority to transact business in this State.  Such limited certificate of authority shall grant the organization authority to service the certificates following the transfer and fulfill all obligations owed to certificate holders but not to otherwise transact insurance business in this State.
(d) The board of directors of a domestic society may suspend or modify its qualifications for membership as necessary or appropriate to facilitate an agreement to transfer under this Section, notwithstanding the laws of the society, or any other law or regulation to the contrary.
(Source: P.A. 98-814, eff. 1-1-15.)
(215 ILCS 5/296.1) (from Ch. 73, par. 908.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 296.1. 
		Conversion of fraternal benefit society to mutual life
insurance company.
(a) Any society subject to the provisions of this
amendatory Act possessed of admitted assets in excess of all liabilities at least
equal  to the minimum surplus required of a new mutual legal reserve life
company under Section 43 of this Code transacting the same kind or kinds of
business may, at its option, without reincorporation, adopt and become
subject to the provisions of Article III of this Code, in lieu  of this amendatory Act.
(b) The board of directors of the society shall approve such proposed
amendments to the articles of incorporation, the constitution and bylaws
of the society as may be necessary or desirable to make the same conform to
the articles of incorporation and bylaws of a mutual legal reserve life
company, in accordance with the requirements of Article III of this Code.
(c) The board of directors of the society shall then submit such
proposed amendments to the Director together with: (1) a copy of the notice
to be given to members and lodges as herein provided; (2) a current
financial statement of the society showing assets, liabilities and surplus
valued in accordance with the requirements of Article III; and (3) the
proposed plan for transition from a fraternal society to a mutual legal
reserve company, including, if pertinent, the following: dissolution of the
lodge system; disposition of property held for the benefit of lodges;
changes in the amount, calculation and collection of future premiums on
policies; the method of selection of officers and board of directors or
trustees to manage and control the mutual company until the regular annual
meeting of its members; and such other changes as may be necessary to an
orderly transition. If the Director finds that: (a) the amendments, notice
and plan are in accordance with the provisions of this amendatory Act and not
inconsistent with the laws and the Constitutions of this State and the
United States; (b) the society has a surplus which, when calculated in
accordance with the requirements of Article III of this Code, is at least
equal to the original surplus required under Article III of a mutual legal
reserve life company transacting the same kind or kinds of business; and (c)
no reasonable objection exists to such conversion, the Director shall,
within a reasonable time, authorize the sending of notices and further
proceedings hereunder.
(d) After the Director has given such authority, the board of directors
of the society shall then submit the proposed amendments and plan of
transition, as so approved, to the supreme governing body of such society at
any regular or special meeting thereof, provided a copy of such amendments
and plan have been included in or enclosed with the notice of such meeting,
which notice shall be given as provided in the laws of the society for the
convening of such supreme governing body in regular or special session as
the case may be. At least 90 days prior to the date of such regular or
special meeting, as the case may be, a notice describing the purpose of
the proposed amendments, and including therein or enclosing therewith a
copy of such amendments and plan of transition, all as approved by the
Director, shall be mailed to each lodge or local body of the society
qualified to choose a delegate or delegates to said meeting and also to
each member of the society; for the purpose of this notice the lodges or
local bodies and the members and the addresses of same shall be taken as
those shown by the records of the society as of a date not earlier than 120
days prior to the date set for such meeting. The affidavit of
any officer, clerk or agent of the company, or of anyone authorized to mail
such notices, that the notices required by this Section bearing the required
postage have been duly addressed and mailed shall, upon final approval by
the Director of the proceedings hereunder, constitute conclusive evidence
that such notice has been duly given in accordance herewith.
(e) The affirmative votes of 2/3 of the members of such supreme
governing body present at such meeting shall be necessary for the adoption
of amendments and the plan of transition under  this Section, provided,
however, that 2/3 of the elective members present shall vote in
favor thereof; the amendments and plan adopted shall be submitted to the
Director for his final approval. If the Director shall find that the
amendments and plan and the adoption thereof are in accordance with this
Section he shall approve the same, and, not less than 30 days nor more
than 60 days after such approval, he shall issue a certificate of
authority authorizing the company to do business subject to and entitled to
the benefits of Article III of this Code. Upon issuance of such
certificate, any right in the society to assess its members shall expire and
any provision for an assessment contained in the policies issued by the
society shall become thenceforth unenforceable, null and void.
(Source: P.A. 84-303.)
(215 ILCS 5/297.1) (from Ch. 73, par. 909.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 297.1. Benefits.
(a) A society may provide the following contractual
benefits in any form:
(1) Death benefits;
(2) Endowment benefits;
(3) Annuity benefits;
(4) Temporary or permanent disability benefits;
(5) Hospital, medical or nursing benefits;
(6) Monument or tombstone benefits to the memory of     deceased members; and
(7) Such other benefits as authorized for life     insurers  and which are not inconsistent with this amendatory Act.
(b) A society shall specify in its rules  those persons who may be
issued, or covered by, the contractual benefits in subsection (a),
consistent with providing benefits to members and their dependents.
A society may provide benefits on the lives of children under the minimum age
for adult membership upon application of an adult person.
(c) After the effective date of this amendatory Act of the 98th General Assembly, a society shall provide an applicant for contractual benefits a disclosure statement that reads  substantially as follows:
". . . . . . .(name of the society) is licensed to do     business in the State of Illinois as a fraternal benefit society. As such, it is not included in the Illinois Life and Health Guaranty Association (otherwise known as the Guaranty Association). This means that fraternal benefit societies cannot be assessed for the insolvency of other life insurers or other fraternal benefit societies. By law, a fraternal benefit society is responsible for its own solvency. If there is an impairment of reserves, a certificate holder may be assessed a proportionate share of the impairment. This process is described in the certificate issued by the society.".
The statement must appear immediately above the applicant's signature on the society's membership application or certificate or policy application, in uppercase and bold type or boxed.
(Source: P.A. 98-814, eff. 1-1-15.)
(215 ILCS 5/298.1) (from Ch. 73, par. 910.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 298.1. 
		Beneficiaries.
(a) The owner of a benefit  contract shall
have the right at all times to change the beneficiary or beneficiaries in
accordance with the laws or rules of the society unless the owner waives
this right by specifically requesting in writing that the beneficiary
designation be irrevocable. A society may, through its laws or rules, limit
the scope of beneficiary designations and shall provide that no revocable
beneficiary shall have or obtain any vested interest in the proceeds of any
certificate until the certificate has become due and payable in conformity
with the provisions of the benefit contract.
(b) A society may make provision for the payment of funeral benefits to
the extent of such portion of any payment under a certificate as might
reasonably appear to be due to any person equitably entitled thereto by
reason of having incurred expense occasioned by the burial of the member,
provided the portion so paid shall not exceed the sum of $2000.
(c) If, at the death of any person insured under a benefit contract,
there is no lawful beneficiary to whom the proceeds shall be payable, the
amount of such benefit, except to the extent that funeral  benefits may be
paid as hereinbefore provided, shall be payable to the personal
representative of the deceased insured, provided that if the owner of the
certificate is other than the insured, such proceeds shall be payable to such owner.
(Source: P.A. 84-303.)
(215 ILCS 5/299.1a) (from Ch. 73, par. 911.1a)
(Section scheduled to be repealed on January 1, 2027)
Sec. 299.1a. Benefits not attachable.
(a) No money or other charity, relief
or aid to be paid, provided or rendered by any society shall be liable to
attachment, garnishment or other process or to be seized, taken,
appropriated or applied by any legal or equitable process or operation of
law to pay any debt or liability of a member or beneficiary, or any other
person who may have a right thereunder, either before or after payment by the
society.
(b) Any benefit association doing
business in
this State and governed by this Article XVII shall encumber or surrender
accounts as defined in Section 10-24 of the Illinois Public Aid Code
held by the benefit
association owned by any responsible relative who is subject to a child
support lien,
upon notice of the lien or levy by the Department of Healthcare and Family Services (formerly Illinois Department of Public Aid)
or its successor agency pursuant to Section 10-25.5 of the Illinois Public Aid
Code, or upon notice of interstate lien from any other state's agency
responsible for implementing the child support enforcement program set forth in
Title IV, Part D of the Social Security Act.
This Section shall not prohibit the furnishing of information in
accordance
with the federal
Personal Responsibility and Work Opportunity Reconciliation Act of 1996.
Any benefit association governed by this Article XVII shall enter into an
agreement for data
exchanges with the Department of Healthcare and Family Services
						
						provided the Department of Healthcare and Family Services pays to the benefit association a reasonable fee not to exceed its
actual cost incurred.  A benefit association providing
information in accordance with this item shall not be liable to any account
holder or other person for any disclosure of information to a State agency, for
encumbering or surrendering any accounts as defined in Section 10-24 of the
Illinois Public Aid Code held by the benefit association
in response to a lien
or order to withhold and deliver issued by a State agency, or for any other
action taken pursuant to this item, including individual or mechanical errors,
provided the action does not constitute gross negligence or willful misconduct.
A benefit association shall have no obligation to hold, encumber, or
surrender accounts until
it has been served with a subpoena, summons, warrant, court or administrative
order, lien, or levy requiring that action.
(Source: P.A. 95-331, eff. 8-21-07.)
(215 ILCS 5/299.1b)
(Section scheduled to be repealed on January 1, 2027)
Sec. 299.1b. Data exchanges;
administrative liens.
(a) Any benefit
association doing business in the State and governed by
this Code shall enter into an agreement for data exchanges
with the Department of Healthcare and Family Services
						
for the purpose of locating accounts as defined in Section 10-24 of the
Illinois Public Aid Code of responsible relatives to
satisfy past-due child support owed by responsible
relatives under an order for support entered by a court or
administrative body of this or any other State on behalf
of resident or non-resident persons.
(b) Notwithstanding any provisions in this Code to the
contrary, a benefit association
shall not be liable to any person:
(1) for any disclosure of information to the     Department of Healthcare and Family Services (formerly Illinois Department of Public Aid) under subsection (a);
(2) for encumbering or surrendering any accounts as     defined in Section 10-24 of the Illinois Public Aid Code held by such benefit association in response to a notice of lien or levy issued by the Department of Healthcare and Family Services (formerly Illinois Department of Public Aid), or by any other state's child support enforcement agency, as provided for in Section 299.1a of this Code; or
(3) for any other action taken in good faith to     comply with the requirements of subsection (a).
(Source: P.A. 95-331, eff. 8-21-07.)
(215 ILCS 5/300.1) (from Ch. 73, par. 912.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 300.1. The benefit contract.
(a) Every 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 thereby. The
certificate, together with any riders or endorsements attached thereto,
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 to each thereof shall 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. All statements on the application shall be
representations and not warranties. Any waiver of this provision shall be void.
(b) Any changes, additions or amendments to the laws of the society duly
made or enacted subsequent to the issuance of the certificate shall bind
the owner and the beneficiaries and shall govern and control the benefit
contract in all respects the same as though such changes, additions or
amendments had been made  prior to and were in force at the time of the
application for insurance, except that no change, addition or amendment
shall destroy or diminish benefits which the society contracted to give the
owner as of the date of issuance.
(c) Any person upon whose life a benefit contract is issued prior to
attaining the age of majority shall be bound by the terms of the
application and certificate and by all the laws and rules of the society to
the same extent as though the age of majority had been attained  at the
time of application.
(d) A society shall provide in its laws and its certificates that, if its
reserves as to all or any class of certificates become impaired, its board of
directors or corresponding body may require  that there shall be paid  by
the owner to the society an assessment in the amount of the owner's equitable proportion of
such deficiency as ascertained by its board, and that, if the payment is not
made, either (1) it shall stand as an indebtedness against the certificate
and draw interest not to exceed the rate specified for certificate loans
under the certificates; or (2) in lieu of or in combination with (1), the
owner may accept a proportionate reduction in benefits  under  the
certificate. However, in no event may an assessment obligation be forgiven, credited, or repaid by whatever means or however labeled by the society in lieu of     collection or reduction in benefits, unless provided to all society members and approved in writing by the Director, except that the forgiveness or repayment of any assessments issued by a society that remain outstanding as of January 1, 2015 (the effective date of Public Act 98-814) may be forgiven or repaid by any manner or plan certified by an independent actuary and filed with the Director to make reasonable and adequate provision for the forgiveness or repayment of the assessment to all society members. Notwithstanding the foregoing, a society may fully repay, credit, or forgive an assessment from the date of death of any life insured under a certificate so long as the plan to forgive or repay the assessment is certified by an independent actuary and filed with the Director to make reasonable and adequate provision for the forgiveness or repayment of the assessment to all assessed society members as a result of the death. The society may specify the manner of the election and which
alternative is to be presumed if no election is made. No such assessment shall take effect unless a 30-day notification has been provided to the Director, who shall have the ability to disapprove the assessment only if the Director finds that such assessment is not in the best interests of the benefit members of the domestic society. Disapproval by the Director shall be made within 30 days after receipt of notice and shall be in writing and mailed to the domestic society.  If the Director disapproves the assessment, the reasons therefor shall be stated in the written notice.
(e) 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 thereof.
(f) No certificate shall be delivered or issued for delivery in this
State unless a copy of the form has been filed with the Director in the
manner provided for like policies issued by life insurers in this State.
Every life, accident, health or disability insurance certificate and every
annuity certificate issued on or after one year from January 1, 1986 (the effective date of Public Act 84-303)
 shall meet the standard contract provision requirements not
inconsistent with Public Act 84-303 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 rules 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 so expelled or
suspended, except for nonpayment of a premium or within the contestable
period for material misrepresentation in the application for membership or
insurance, shall have the privilege of maintaining the certificate in force
by continuing payment of the required premium.
(g) Benefit contracts issued on the lives of persons below the society's
minimum age for adult membership may provide for transfer of control or
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 respect for the regulation,
government and control of such certificates and all rights, obligations and
liabilities incident thereto and connected therewith. Ownership rights
prior to such transfer shall be specified in the certificate.
(h) A society may specify the terms and conditions on which benefit
contracts may be assigned.
(Source: P.A. 101-81, eff. 7-12-19.)
(215 ILCS 5/301.1) (from Ch. 73, par. 913.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 301.1. 
		Nonforfeiture benefits, cash surrender values, certificate
loans and other  options.
(a) For certificates issued prior to one year
after the effective date of this amendatory Act, the value of every paid-up
nonforfeiture benefit and the amount of  any cash surrender value, loan or
other option granted shall comply with the provisions of law applicable
immediately prior to the effective date of this amendatory Act.
(b) For certificates issued on or after one year from the effective date
of this amendatory Act for which reserves are computed on the Commissioner's
1941 Standard Ordinary Mortality Table, the Commissioner's 1941 Standard
Industrial Table, the Commissioner's 1958 Standard Ordinary Mortality
Table, the Commissioner's 1980 Standard Mortality Table or any more
recent table made  applicable to life insurers, every paid-up nonforfeiture
benefit and the amount of any cash surrender value, loan or other  option
granted shall not be less than the corresponding amount ascertained in
accordance with the laws of this State applicable to life insurers issuing
policies containing like benefits based upon such tables.
(Source: P.A. 84-303.)
(215 ILCS 5/302.1) (from Ch. 73, par. 914.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 302.1. 
		Investments and admitted assets. 
		A domestic society shall
invest its funds only in such investments as are authorized by the laws of
this State for the investment of assets of life insurers and subject to the
limitations  thereon. Any foreign or alien society permitted or seeking to
do business in this State which invests its funds in accordance with the
laws of the state, district, territory, country or province in which it is
incorporated shall be held to meet the requirements of this Section for
the investment of funds. Admitted assets in addition to investments
authorized by this Section and Article VIII and Article VIII 1/2 of this
Code shall be in accordance with Section 3.1 of this Code.
(Source: P.A. 84-303.)
(215 ILCS 5/303.1) (from Ch. 73, par. 915.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 303.1. 
		Funds.
(a) All assets shall be held, invested and disbursed
for the use and benefit of the society, and no member or beneficiary shall
have or acquire individual rights therein or become entitled to any
apportionment on the surrender of any part thereof except as provided in
the benefit contract.
(b) A society may create, maintain, invest, disburse and apply any
special fund or funds necessary to carry out any purpose permitted by the
laws of such society.
(c) A society may, pursuant to resolution of its supreme governing body,
establish and operate one or more separate accounts and issue contracts on
a variable basis, subject to the provisions of Article XIV 1/2 of this
Code. To the extent the society deems it necessary in order to comply with
any applicable federal or State law, or any rules issued thereunder, the
society may adopt special procedures for the conduct of the business and
affairs of a separate account; may, for persons having beneficial interests
therein, provide special voting and other rights, including without
limitation special rights and procedures relating to investment policy,
investment advisory services, selection of certified public accountants
and selection of a committee to manage the business and affairs of the
account; and may issue contracts on a variable  basis to which subsection
300.1(b) and 300.1(d) of this amendatory Act shall not apply.
(Source: P.A. 84-303.)
(215 ILCS 5/304.2) (from Ch. 73, par. 916.2)
(Section scheduled to be repealed on January 1, 2027)
Sec. 304.2. 
		Taxation. 
		Every society organized or licensed under this
amendatory Act is hereby declared to be a charitable and benevolent institution,
and all of its funds shall be exempt from all and every State, county,
district, municipal and school tax other than taxes on real estate and office equipment.
(Source: P.A. 84-303.)
(215 ILCS 5/305.1) (from Ch. 73, par. 917.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 305.1. 
		Valuation.
(a) Standards of valuation for certificates
issued prior to one year after the effective date of this amendatory Act shall be
those provided by the laws applicable immediately prior to the  effective
date of this amendatory Act.
(b) The minimum standards of valuation for certificates issued on or
after one year from the effective date of this amendatory Act shall be based on
the following tables:
(1) For certificates of life insurance - the     Commissioner's 1941 Standard Ordinary Mortality Table, the Commissioner's 1941 Standard Industrial Mortality Table, the Commissioner's 1958 Standard Ordinary Mortality Table, the Commissioner's 1980 Standard Ordinary Mortality Table or any more recent table made applicable to life insurers; and
(2) For annuity and pure endowment certificates, for     total and permanent disability benefits, for accidental death benefits and for non-cancellable accident and health benefits - such tables as are  authorized for use by life insurers in this State.
All of the above shall be under valuation methods and standards including,
but not limited to, interest assumptions in accordance  with the laws of
this State applicable  to life insurers issuing policies containing like benefits.
(c) The Director may, in his or her discretion, accept other standards
for valuation if the Director finds that the reserves produced thereby will
not be less in the aggregate than reserves computed in accordance with the
minimum valuation standard herein prescribed. The Director may, in his or
her discretion, vary the standards of mortality applicable to all benefit
contracts on substandard lives or other extra-hazardous lives by any
society authorized to do business in this State.
(d) Any society, with the consent of the Commissioner of Insurance of the
state of domicile of the society and under such conditions, if any, which
the Commissioner may impose, may establish and maintain reserves on its
certificates in excess of the  reserves required thereunder, but the
contractual rights of any benefit member shall not be affected thereby.
(Source: P.A. 84-303.)
(215 ILCS 5/306.1) (from Ch. 73, par. 918.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 306.1. 
		Reports. 
		Every society transacting business in this State
shall annually, on or before the first day of March, unless for cause shown
such time has been extended by the Director, file with the Director a true
statement of its financial  condition, transactions and affairs for the
preceding calendar year in accordance with Section 136 of this Code. The
statement shall be in general form and context as approved by the National
Association of Insurance Commissioners for fraternal benefit societies and
as supplemented by additional information required by the Director.
(Source: P.A. 84-303.)
(215 ILCS 5/307.1) (from Ch. 73, par. 919.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 307.1. 
		Annual license. 
		Societies which were authorized to transact
business in this State prior to the effective date of this amendatory Act may
continue  such business until the first day of July next succeeding the
effective date of this amendatory Act. The authority of such societies and all
societies hereafter issued certificates of authority may thereafter be
renewed annually, but in all cases to terminate on the first day of the
succeeding July. A certified copy or duplicate of such certificate of
authority shall be prima facie evidence that the licensee is a fraternal
benefit society within the meaning of this amendatory Act.
(Source: P.A. 84-303.)
(215 ILCS 5/308.1) (from Ch. 73, par. 920.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 308.1. 
		Examination of societies - adverse publications.
(a) The
Director, or any person he or she may appoint, may examine any domestic,
foreign or alien society transacting or applying for admission to transact
business in this State in the same manner as authorized for examination of
domestic, foreign or alien insurance companies. Requirements of notice and
an opportunity to respond before findings are made public as provided in
the laws regulating insurance companies shall also be applicable to the
examination of societies.
(b) The expense of each examination and  of each valuation, including
compensation and actual expense of examiners, shall be paid by the society
examined or whose certificates are valued, upon statements  furnished by the Director.
(Source: P.A. 84-303.)
(215 ILCS 5/309.1) (from Ch. 73, par. 921.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 309.1. 
		Foreign or alien society - admission. 
		No foreign or alien
society shall transact business in this State without a certificate of
authority issued by the Director in accordance with Article VI of this
Code. Any such society desiring admission to this State shall comply
substantially with  the requirements and limitations of this amendatory Act
applicable to domestic societies.
(Source: P.A. 84-303.)
(215 ILCS 5/310.1) (from Ch. 73, par. 922.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 310.1. 
		Suspension, revocation or refusal to renew certificate of
authority.
(a) Domestic Societies. When, upon  investigation, the Director
is satisfied that any domestic society transacting business under this
amendatory Act has exceeded its powers or has failed to comply with any
provisions  of this amendatory Act or is conducting business fraudulently or in
a
way hazardous to its members, creditors or the public or is not carrying
out its contracts in good faith, the Director shall notify the society of
his or her findings, stating in writing the grounds of his or her
dissatisfaction, and, after reasonable notice, require the society on a date
named to show cause why its certificate of authority should not be revoked
or suspended or why such society should not be fined as hereinafter
provided or why the Director should not proceed against  the society under
Article XIII  of this Code. If, on the date named in said notice, such
objections have not been removed to the satisfaction of the Director
or if the society does not present good and sufficient reasons why its
authority to transact business in this State should not at that time be
revoked or suspended or why such society should not be fined as
hereinafter provided,  the Director may revoke the authority  of the society to
continue business in this State and proceed against the society under
Article XIII of this Code or suspend such certificate of authority for any
period of time up to, but not to exceed, 2 years; or may by order require
such society to pay to the people of the State of Illinois a penalty in a
sum not exceeding $10,000, and, upon the failure of such
society to pay such penalty within 20 days after the mailing of such
order, postage prepaid, registered and addressed to the last known place
of business of such society, unless such order is stayed by an order of a
court of competent jurisdiction, the Director may revoke or suspend the
license of such society for any period of time up to, but not exceeding, a
period  of 2 years.
(b) Foreign or alien societies. The Director shall suspend, revoke or
refuse to renew certificates of authority in accordance with Article VI of this
Code.
(Source: P.A. 93-32, eff. 7-1-03.)
(215 ILCS 5/311.1) (from Ch. 73, par. 923.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 311.1. 
		Injunction proceedings.
(a) Upon the refusal or neglect of
any society to make the annual report, as provided in this amendatory Act, or in
case any such society shall exceed its powers or shall conduct its business
fraudulently or is not carrying out its contracts in good faith or shall
be 30 days in arrears in the payment of death or disability claims,
endowments or annuities after the same have been allowed by the board of
directors or other person or persons whose duty it is to pass upon such
claims and after establishment of the interest and competency of the payee
to receive, receipt and acquit for payment, provided that such claim shall
be approved or disapproved within 60 days after receipt of due proof of
loss or death or, after one year's existence, shall have a membership of
less than 500 or shall determine to discontinue business or shall
fail to comply with any of the provisions of this amendatory Act, the Director shall
immediately commence, or cause to be commenced, an action against such society
under Article XIII of this Code and to enjoin the same from carrying on
any business, and an injunction may be granted, upon proper showing by the
Director, in any circuit court in this State; provided, however, that no
injunction against any society within this State or application for or
appointment of a receiver or action to prevent any society from carrying
on business in this State shall be made or granted by any court except on
the application of the Director and after written notice duly made and served
upon the chief executive officer of such society within this State, or, if
incorporated under the laws of another state, then such notice may be served
by sending the same to the president or secretary of the society by registered
mail at the home office of the society, and a full hearing before such court,
whether the party seeking such relief be the State, member of such society
or any other person whatsoever.
(b) If the court shall find that such society so enjoined was in default as
charged and the violation complained of shall have been corrected and the
injunction dissolved, the society may continue in business provided it
shall have satisfied the Director that it has paid the costs of the action.
Any officer, agent or person acting for any society or subordinate body
thereof within this State and who shall transact any business for such
society contrary to the provisions of such injunction or prohibition while
such society shall be so enjoined or prohibited from doing business
pursuant to this amendatory Act shall be deemed guilty of a Class A misdemeanor.
(Source: P.A. 84-303.)
(215 ILCS 5/312.1) (from Ch. 73, par. 924.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 312.1. 
		Salaries. 
		No domestic society shall pay any salary,
compensation or emolument to any officer, trustee or director thereof, nor
any salary, compensation or emolument amounting in any year to more than
$40,000 to any person, firm or corporation, unless such payment be
first authorized by the supreme governing body or the board of directors or
corresponding body. No such society shall make any agreement with any of
its officers, trustees or directors or salaried employees whereby it agrees
that for any service rendered or to be rendered he shall receive any
salary, compensation or emolument that will extend beyond a
period of 4 years from the date of such agreement, provided that payment of
an amount not in excess of 20% of the salary of any of its officers,
directors or salaried employees may by written agreement be deferred
beyond such period of 4 years, which agreement may include conditions to
be met by such officers, directors or salaried employees before payment
will be made, and provided further that a domestic society may enter
into contracts with its producer for the payment of renewal commissions. No
such society shall enter into a special contract which will compensate any
officer, trustee or director based on a percentage of premiums collected by
the society or on a percentage of the entire insurance business of the
society. No such society shall grant any pension to any officer, trustee or
director thereof or to any member of his family after his death except
that it may provide a pension pursuant to the terms of a uniform retirement
plan adopted by the board of directors.
(Source: P.A. 84-303.)
(215 ILCS 5/313.1) (from Ch. 73, par. 925.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 313.1. 
		Licensing of producers.
(a) Except as otherwise provided
in this Section, producers of societies shall be subject to the provisions
of Article XXXI of this Code.
(b) No examination or license shall be required of any regular salaried
officer, employee or member of a licensed society who devotes substantially
all of his or her services to activities other than the solicitation of
fraternal benefit contracts from the public and who receives for the
solicitation of such contracts no commission or other compensation
directly dependent upon the amount of business obtained.
(c) Any producer, representative or member of a society who devotes or
intends to devote less than 50% of such person's time to the
solicitation and procurement of benefit contracts for such society shall be
exempt from the requirements of subsection (a). Any person who in the
preceding calendar year has solicited and procured life insurance contracts
on behalf of any society in an amount of insurance in excess of $100,000
or, in the case of any other kind or kinds of insurance which the society
might write, on the persons of more than 25 individuals and who has
received or will receive a commission or other compensation therefor shall
be presumed to be devoting, or intending to devote, 50% of time
to the solicitation or
procurement of benefit contracts for such society.
(Source: P.A. 84- 303.)
(215 ILCS 5/314.1) (from Ch. 73, par. 926.1)
(Section scheduled to be repealed on January 1, 2027)
Sec. 314.1. 
		Unfair methods of competition and unfair and deceptive
acts and practices.  Every society authorized to do business in this State
shall be subject to the provisions of Article XXVI of this Code, provided,
however, that nothing in such provisions shall be construed as applying to
or affecting the right of any society to determine its eligibility
requirements for membership or be construed as applying to or affecting
the offering of benefits exclusively to members or persons eligible for
membership in the society by a subsidiary corporation or affiliated
organization of the society.
(Source: P.A. 84-303.)
(215 ILCS 5/315.2) (from Ch. 73, par. 927.2)
(Section scheduled to be repealed on January 1, 2027)
Sec. 315.2. 
		Service of process.
(a) Every society authorized to do
business in this State shall appoint in writing the Director and each
successor in office to be its true and lawful attorney upon whom all lawful
process in any action or proceeding against it shall be served and shall
agree in such writing that any lawful process against it which is served on
said attorney shall be of the same legal force and validity as if served
upon the society and that the authority shall continue in force so long as
any liability remains outstanding in this State. Copies of such
appointment, certified by said Director, shall be deemed sufficient evidence
thereof and shall be admitted in evidence with the same force and effect as
the original thereof might be admitted.
(b) Service shall be made by delivering to and leaving with the Director
duplicate copies of such process with payment of the fee prescribed by this
Code and the service thereof shall constitute sufficient service upon the
society. When legal process against a society is served upon the Director,
the Director shall forthwith forward one of the duplicate copies, by
certified or registered mail prepaid, to the society. No such service shall
require a society to file its answer, pleading or defense in less than
30 days from the date of mailing the copy of the service to a society
unless otherwise ordered by the court. Legal process shall not be served
upon a society except in the manner herein provided.
(Source: P.A. 84-303.)
(215 ILCS 5/315.3) (from Ch. 73, par. 927.3)
(Section scheduled to be repealed on January 1, 2027)
Sec. 315.3. 
		Review. 
		The provisions of the Administrative Review Law,
and all amendments and modifications thereof, and the rules adopted
pursuant thereto shall apply to and govern all proceedings for the
judicial review of final administrative decisions of the Department.
(Source: P.A. 84-303.)
(215 ILCS 5/315.4) (from Ch. 73, par. 927.4)
(Section scheduled to be repealed on January 1, 2027)
Sec. 315.4. 
		Penalties.
(a) Any person who willfully makes a false or
fraudulent statement in or relating to an application for membership or for
the purpose of obtaining money from, or a benefit in, any society shall upon
conviction be fined not less than $200 nor more than $10,000 or be subject to
 imprisonment in the county jail not less than 30 days nor more than one
year, or both.
(b) Any person who willfully makes a false or fraudulent statement in any
verified report or declaration under oath required or authorized by this
amendatory Act, or of any material fact or thing contained in a sworn statement
concerning the death or disability of an insured for the purpose of
procuring payment of a benefit named in the certificate, shall be guilty of
perjury and shall be subject to the penalties therefor prescribed by law.
(c) Any person who solicits membership for, or in any manner assists in
procuring membership in, any society not licensed to do business in this
State shall upon conviction be fined not less than $100 nor more
than $400.
(d) Any person guilty of a willful violation of, or neglect or refusal
to comply with, the provisions of this amendatory Act for which a penalty is
not
otherwise prescribed shall upon conviction be subject to a fine
not exceeding $10,000.
(Source: P.A. 93-32, eff. 7-1-03.)
(215 ILCS 5/315.5) (from Ch. 73, par. 927.5)
(Section scheduled to be repealed on January 1, 2027)
Sec. 315.5. 
		Exemption of certain societies.
(a) Nothing contained in
this amendatory Act shall be so construed as to affect or apply to:
(1) grand or subordinate lodges of societies, orders     or associations now doing business in this State which provide benefits exclusively through local or subordinate lodges;
(2) orders, societies or associations which admit to     membership only persons engaged in one or more crafts or hazardous occupations, in the same or similar lines of business, insuring only their own members and their families, and the ladies' societies or ladies' auxiliaries to such orders, societies or associations;
(3) domestic societies which limit their membership     to employees of a particular city or town, designated firm, business house or corporation which provide for a death benefit of not more than $700 or disability benefits of not more than $650 to any person in any one year, or both; or
(4) domestic societies or associations of a purely     religious, charitable or benevolent description which provide for a death benefit of not more than $400 or for disability benefits of not more than $350 to any one person in any one year, or both.
(b) Any such society or association described in subsections (a)(3) or
(a)(4) supra which provides for death or disability benefits for which
benefit certificates are issued and any such society or association
included in subsection (a)(4) which has more than 1000 members
shall not be exempted from the provisions of this amendatory Act but shall
comply with all requirements thereof.
(c) No society which, by the provisions of this Section, is exempt from
the requirements of this amendatory Act, except any society  described in
subsection (a)(2) supra, shall give or allow, or promise to give or allow,
to any person any compensation for procuring new members.
(d) Every society which provides for benefits in case of death or
disability resulting solely from accident and which does not obligate
itself to pay natural death or sick benefits shall have all of the
privileges and be subject to all the applicable provisions and regulations
of this amendatory Act except that the provisions thereof relating to medical
examination, valuations of benefit certificates and incontestability
shall not apply to such society.
(e) The Director may require from any society or association, by
examination or otherwise, such information as will enable  the Director to
determine whether such society or association is exempt from the provisions
of this amendatory Act.
(f) Societies  exempted under the provisions of this Section shall
also be exempt from all other provisions of the insurance laws of this State.
(Source: P.A. 86-187.)
(215 ILCS 5/315.6) (from Ch. 73, par. 927.6)
(Section scheduled to be repealed on January 1, 2027)
Sec. 315.6. Application of other Code provisions. Unless otherwise
provided in this amendatory Act, every fraternal benefit society shall be
governed
by this amendatory Act and shall be exempt from all other provisions of the
insurance laws of this State not only in governmental relations with the
State but for every other purpose, except for those provisions specified in
this amendatory Act and except as follows:
(a) Sections 1, 2, 2.1, 3.1, 117, 118, 132, 132.1,     132.2, 132.3, 132.4, 132.5, 132.6, 132.7, 133, 134, 136, 138, 139, 140, 141, 141.01, 141.1, 141.2, 141.3, 143, 143c, 144.1, 147, 148, 149, 150, 151, 152, 153, 154.5, 154.6, 154.7, 154.8, 155, 155.04, 155.05, 155.06, 155.07, 155.08 and 408 of this Code; and
(b) Articles VIII 1/2, XII, XII 1/2, XIII, XXIV, and     XXVIII of this Code.
(Source: P.A. 98-814, eff. 1-1-15.)
(215 ILCS 5/315.7) (from Ch. 73, par. 927.7)
(Section scheduled to be repealed on January 1, 2027)
Sec. 315.7. 
		Severability. 
		If any provision of this amendatory Act or the
application of such provision to any circumstance is held invalid, the
remainder of the amendatory Act or the application of the provision to other
circumstances shall not be affected thereby.
(Source: P.A. 84-303.)
(215 ILCS 5/315.9)
(Section scheduled to be repealed on January 1, 2027)
Sec. 315.9. Voluntary dissolution.   Upon application to the Director, a domestic society may request that it be dissolved and that its existence be terminated.  The  application shall demonstrate that the applicant has satisfied its members' certificate obligations or that it has transferred such obligations to another organization, domestic or foreign, by means of assumption or bulk reinsurance or otherwise, and that the domestic society's supreme governing body has approved the termination and dissolution.  The application shall contain any other information required by the Director. Any limitation related to reinsurance by a domestic society shall not apply to reinsurance entered into in conjunction with the transfer of members' certificate obligations as a part of a voluntary dissolution.  Upon approval of the application by the Director, the domestic society shall be deemed dissolved and its existence terminated as of the date set forth in the application.
(Source: P.A. 98-814, eff. 1-1-15.)