2023 New York Laws › ISC - Insurance › Article 45 - Fraternal Benefit Societies › 4502 - Incorporation and Licensing of Domestic Societies; Meeting of Supreme Governing Body.

§ 4502.  Incorporation and licensing of domestic societies; meeting of
supreme governing body.  An authorized domestic society may be organized
and  licensed  in  the manner prescribed in this section, and subject to
the  other  requirements  of  this  chapter  applicable  thereto.    The
successive steps shall be as follows:
(a)    The  proposed  incorporators,  who  shall  be  natural persons,
citizens of the United States and a majority of whom shall  be  citizens
of  this  state, and who shall be not less than fifteen in number, shall
submit to the superintendent in writing the proposed name of the society
and the county in which its principal office will be located.  Such name
shall contain a word or words indicating the fraternal character of such
society, and shall not contain any of the following words:  "insurance",
"assurance",   "life",   "accident",  "health",  "annuity",  "guaranty",
"company",   "corporation",   "indemnity",   "endowment",   "guarantee",
"casualty",  "surety", "fidelity", or "underwriters", or any  other word
or words which in the judgment of the superintendent would be likely  to
be  deceptive  or  misleading  as  to the character and purposes of such
society.  Such proposal shall be subscribed with the name and address of
each such incorporator.
(b)  If the superintendent approves the proposed name of  the  society
as  conforming  to  the  requirements  of  subsection (g) of section one
thousand one hundred two of this chapter and not inconsistent with other
requirements of law, he shall so notify the proposed  incorporators,  or
their  representative,  in writing.   Such approval shall become void if
within six months from the date thereof the declaration and  charter  of
such society have not been filed pursuant to this section.
(c)  The proposed incorporators shall make and subscribe (giving their
addresses)  and  affirm  as  true  under  the  penalties  of  perjury, a
declaration and charter, both in the English language,  and  shall  file
the same with the superintendent, together with duly certified copies of
the  proposed constitution, by-laws, rules and regulations, all proposed
forms of  certificates  or  other  evidences  of  insurance  or  annuity
contracts, or both, all applications therefor and riders or endorsements
to  be  used  in connection therewith, all circulars to be issued by the
society, and a table or schedule showing the rates of premium  or  other
periodical  contribution to be charged by such society for any insurance
or annuity benefits to be provided by it.  Such declaration shall  state
the  intention  of  the proposed incorporators to form a society for the
purpose of providing insurance benefits permissible under the provisions
of this article, and  for  other  purposes  not  inconsistent  with  the
provisions  of  this  chapter.    The proposed charter shall contain the
following:
(1)  the name of the proposed society, approved as aforesaid;
(2)  the place where such society  will  have  its  principal  office,
which shall be in this state;
(3)    the  general,  fraternal,  altruistic,  educational, patriotic,
recreational and other purposes  of  such  society,  and  the  kinds  of
insurance  benefits  to  be provided by it, specified in accordance with
section four thousand five hundred five of this article;
(4)  the mode and manner in which  its  corporate  powers  are  to  be
exercised;
(5)  the  number  of directors shall not be less than nine of which at
least four must not be officers or employees of the society. The charter
of such society shall provide that the  number  of  directors  shall  be
increased to not less than thirteen within one year following the end of
the  calendar  year  in  which the society exceeded five hundred million
dollars in admitted assets. "Number of directors" herein means the total

number of directors which the  society  would  have  if  there  were  no
vacancies;
(6)   the times and manner of electing its directors and officers, the
manner of filling vacancies in such offices, and a provision that at all
times a majority of the directors shall be  citizens  and  residents  of
this  state or of adjoining states, and not less than five thereof shall
be residents of this state;
(7)  the names and postoffice residence addresses of the directors who
shall serve until the first election in accordance with the charter  and
by-laws;
(8)    the duration of its corporate existence which shall be not less
than thirty years;
(9)   such other particulars  as  may  be  necessary  to  explain  the
objects, purposes, management and control of such society; and
(10)   such  additional  information  as  the  superintendent  may  by
regulation require.
(d)  The superintendent shall transmit such declaration,  charter  and
accompanying documents to the attorney general.  If the same be approved
by  the  attorney general, as conforming to the requirements of law, the
superintendent shall thereupon file the declaration and charter  in  his
office,  and  shall  issue  a  certified  copy  of  each to the proposed
incorporators.  Such  incorporators  shall  thereupon  become   a   body
corporate  which  shall  not  be  authorized to do an insurance business
until  it  shall  have  obtained  a  license  therefor  as  provided  in
subsection  (f)  hereof, but it   may solicit members for the purpose of
completing  its  organization,  collecting  from  each   applicant   for
insurance  an  amount  not  less  than  one  regular monthly premium, in
accordance with its table or schedule of rates,  issuing  to  each  such
applicant  a  receipt  for the amount so collected and providing for the
examination of each applicant for life insurance  by  legally  qualified
practicing  physicians with certificates of such examinations to be duly
filed and approved by  the  chief  medical  examiner  of  such  society.
Before  soliciting  or  receiving  any premium or other contribution for
insurance benefits of any kind or character, the society shall file with
the superintendent a bond in the sum  of  five  thousand  dollars,  with
sureties  approved by the superintendent, conditioned upon the return to
applicants of the advanced payments, as provided in this section, if the
society does not complete its organization and obtain a  license  to  do
business  within  one year from the date of incorporation or within such
further time as the superintendent may permit pursuant to subsection (g)
hereof.  The society shall incur no liability except for  the  repayment
of  such  advanced payments, nor issue any certificate or other evidence
of an insurance or annuity contract, or both, unless and until it  shall
have obtained a license to do business as hereinafter provided.
(e)  Before  obtaining  a  license  to do business in this state, such
society shall have established not less than ten subordinate  lodges  or
branches,  into  which  not  less than five hundred applicants have been
initiated  and  shall  have  actual  bona  fide  applications  for  life
insurance  benefits  upon  at least five hundred lives each eligible for
such insurance, in accordance with the provisions of this  article,  for
at  least  one  thousand  dollars   on each life and shall have received
payments  thereunder in the aggregate amount of at  least  two  thousand
five hundred dollars.  Before obtaining such  license such society shall
submit to the superintendent, under oath of the president and secretary,
or  corresponding  officers,  a complete list of such applicants, giving
their names, addresses, dates of examination, approval  and  initiation,
the  name  and  number  of the subordinate lodge or branch of which each
applicant is a member, the amount and kinds of insurance benefits to  be

granted,  the  rate of periodical insurance contributions of each, which
shall conform to the requirements of  this  article,  and  the  bank  or
banking  institution  in  which  all sums collected from such applicants
have  been  deposited.    Such  advanced  payments  or  other  insurance
contributions by applicants shall, during the period of organization and
until the issuance of a license to do business,  be  held  in  trust  on
account  of  such  applicants,  and  no  part  thereof  may  be used for
expenses; and if a license is not issued within one year  from  date  of
incorporation,   such   advanced  payments  shall  be  returned  to  the
applicants who originally made the same.
(f)  If the superintendent finds, from the statements of the principal
officers of such society, subscribed and affirmed by  such  officers  as
true  under  the  penalties  of  perjury,  or from such investigation or
examination as he may deem expedient, that  such  society  has  complied
with  the requirements of this section and that the purposes and plan of
operation of such society are in accordance  with  the  requirements  of
law,  he  may  issue  to  such  society a license to do business in this
state.   Such license shall set forth  the  name  of  the  society,  the
location  of  its principal office, and the kind of insurance or annuity
benefits, or  both, specified in section four thousand five hundred five
of this article, which it is   authorized  to  provide  in  this  state.
Thereupon  the  society  shall  have  such  powers  as  are necessary or
properly incidental to carry into effect the lawful objects and purposes
of the society.
(g)  If any such society shall fail to obtain such license within  one
year  from  the date of its incorporation or within such further period,
not to exceed one additional year, as  the  superintendent  may  in  his
discretion  permit,  the superintendent may commence proceedings for the
dissolution of such society in accordance with article  seventy-four  of
this chapter.
(h)    A  domestic  society may provide for the meeting of its supreme
governing body in any other state, province or  territory  wherein  such
society  has  not less than five subordinate lodges or branches.  In all
meetings of the supreme governing body,  no  member,  representative  or
delegate shall cast more than one vote on any question submitted.