§ 4502 — Incorporation and licensing of domestic societies; meeting of supreme governing body

New York § 4502

• Jurisdiction: New York
• Law ISC: Insurance
• Art. 45: Fraternal Benefit Societies

Text

§ 4502. Incorporation and licensing of domestic societies; meeting of\nsupreme governing body. An authorized domestic society may be organized\nand licensed in the manner prescribed in this section, and subject to\nthe other requirements of this chapter applicable thereto. The\nsuccessive steps shall be as follows:\n (a) The proposed incorporators, who shall be natural persons,\ncitizens of the United States and a majority of whom shall be citizens\nof this state, and who shall be not less than fifteen in number, shall\nsubmit to the superintendent in writing the proposed name of the society\nand the county in which its principal office will be located. Such name\nshall contain a word or words indicating the fraternal character of such\nsociety, and shall not contain any of the following words: "insurance",\n"assurance", "life", "accident", "health", "annuity", "guaranty",\n"company", "corporation", "indemnity", "endowment", "guarantee",\n"casualty", "surety", "fidelity", or "underwriters", or any other word\nor words which in the judgment of the superintendent would be likely to\nbe deceptive or misleading as to the character and purposes of such\nsociety. Such proposal shall be subscribed with the name and address of\neach such incorporator.\n (b) If the superintendent approves the proposed name of the society\nas conforming to the requirements of subsection (g) of section one\nthousand one hundred two of this chapter and not inconsistent with other\nrequirements of law, he shall so notify the proposed incorporators, or\ntheir representative, in writing. Such approval shall become void if\nwithin six months from the date thereof the declaration and charter of\nsuch society have not been filed pursuant to this section.\n (c) The proposed incorporators shall make and subscribe (giving their\naddresses) and affirm as true under the penalties of perjury, a\ndeclaration and charter, both in the English language, and shall file\nthe same with the superintendent, together with duly certified copies of\nthe proposed constitution, by-laws, rules and regulations, all proposed\nforms of certificates or other evidences of insurance or annuity\ncontracts, or both, all applications therefor and riders or endorsements\nto be used in connection therewith, all circulars to be issued by the\nsociety, and a table or schedule showing the rates of premium or other\nperiodical contribution to be charged by such society for any insurance\nor annuity benefits to be provided by it. Such declaration shall state\nthe intention of the proposed incorporators to form a society for the\npurpose of providing insurance benefits permissible under the provisions\nof this article, and for other purposes not inconsistent with the\nprovisions of this chapter. The proposed charter shall contain the\nfollowing:\n (1) the name of the proposed society, approved as aforesaid;\n (2) the place where such society will have its principal office,\nwhich shall be in this state;\n (3) the general, fraternal, altruistic, educational, patriotic,\nrecreational and other purposes of such society, and the kinds of\ninsurance benefits to be provided by it, specified in accordance with\nsection four thousand five hundred five of this article;\n (4) the mode and manner in which its corporate powers are to be\nexercised;\n (5) the number of directors shall not be less than nine of which at\nleast four must not be officers or employees of the society. The charter\nof such society shall provide that the number of directors shall be\nincreased to not less than thirteen within one year following the end of\nthe calendar year in which the society exceeded five hundred million\ndollars in admitted assets. "Number of directors" herein means the total\nnumber of directors which the society would have if there were no\nvacancies;\n (6) the times and manner of electing its directors and officers, the\nmanner of filling vacancies in such offices, and a provision that at all\ntimes a majority of the directors shall be citizens and residents of\nthis state or of adjoining states, and not less than five thereof shall\nbe residents of this state;\n (7) the names and postoffice residence addresses of the directors who\nshall serve until the first election in accordance with the charter and\nby-laws;\n (8) the duration of its corporate existence which shall be not less\nthan thirty years;\n (9) such other particulars as may be necessary to explain the\nobjects, purposes, management and control of such society; and\n (10) such additional information as the superintendent may by\nregulation require.\n (d) The superintendent shall transmit such declaration, charter and\naccompanying documents to the attorney general. If the same be approved\nby the attorney general, as conforming to the requirements of law, the\nsuperintendent shall thereupon file the declaration and charter in his\noffice, and shall issue a certified copy of each to the proposed\nincorporators. Such incorporators shall thereupon become a body\ncorporate which shall not be authorized to do an insurance business\nuntil it shall have obtained a license therefor as provided in\nsubsection (f) hereof, but it may solicit members for the purpose of\ncompleting its organization, collecting from each applicant for\ninsurance an amount not less than one regular monthly premium, in\naccordance with its table or schedule of rates, issuing to each such\napplicant a receipt for the amount so collected and providing for the\nexamination of each applicant for life insurance by legally qualified\npracticing physicians with certificates of such examinations to be duly\nfiled and approved by the chief medical examiner of such society.\nBefore soliciting or receiving any premium or other contribution for\ninsurance benefits of any kind or character, the society shall file with\nthe superintendent a bond in the sum of five thousand dollars, with\nsureties approved by the superintendent, conditioned upon the return to\napplicants of the advanced payments, as provided in this section, if the\nsociety does not complete its organization and obtain a license to do\nbusiness within one year from the date of incorporation or within such\nfurther time as the superintendent may permit pursuant to subsection (g)\nhereof. The society shall incur no liability except for the repayment\nof such advanced payments, nor issue any certificate or other evidence\nof an insurance or annuity contract, or both, unless and until it shall\nhave obtained a license to do business as hereinafter provided.\n (e) Before obtaining a license to do business in this state, such\nsociety shall have established not less than ten subordinate lodges or\nbranches, into which not less than five hundred applicants have been\ninitiated and shall have actual bona fide applications for life\ninsurance benefits upon at least five hundred lives each eligible for\nsuch insurance, in accordance with the provisions of this article, for\nat least one thousand dollars on each life and shall have received\npayments thereunder in the aggregate amount of at least two thousand\nfive hundred dollars. Before obtaining such license such society shall\nsubmit to the superintendent, under oath of the president and secretary,\nor corresponding officers, a complete list of such applicants, giving\ntheir names, addresses, dates of examination, approval and initiation,\nthe name and number of the subordinate lodge or branch of which each\napplicant is a member, the amount and kinds of insurance benefits to be\ngranted, the rate of periodical insurance contributions of each, which\nshall conform to the requirements of this article, and the bank or\nbanking institution in which all sums collected from such applicants\nhave been deposited. Such advanced payments or other insurance\ncontributions by applicants shall, during the period of organization and\nuntil the issuance of a license to do business, be held in trust on\naccount of such applicants, and no part thereof may be used for\nexpenses; and if a license is not issued within one year from date of\nincorporation, such advanced payments shall be returned to the\napplicants who originally made the same.\n (f) If the superintendent finds, from the statements of the principal\nofficers of such society, subscribed and affirmed by such officers as\ntrue under the penalties of perjury, or from such investigation or\nexamination as he may deem expedient, that such society has complied\nwith the requirements of this section and that the purposes and plan of\noperation of such society are in accordance with the requirements of\nlaw, he may issue to such society a license to do business in this\nstate. Such license shall set forth the name of the society, the\nlocation of its principal office, and the kind of insurance or annuity\nbenefits, or both, specified in section four thousand five hundred five\nof this article, which it is authorized to provide in this state.\nThereupon the society shall have such powers as are necessary or\nproperly incidental to carry into effect the lawful objects and purposes\nof the society.\n (g) If any such society shall fail to obtain such license within one\nyear from the date of its incorporation or within such further period,\nnot to exceed one additional year, as the superintendent may in his\ndiscretion permit, the superintendent may commence proceedings for the\ndissolution of such society in accordance with article seventy-four of\nthis chapter.\n (h) A domestic society may provide for the meeting of its supreme\ngoverning body in any other state, province or territory wherein such\nsociety has not less than five subordinate lodges or branches. In all\nmeetings of the supreme governing body, no member, representative or\ndelegate shall cast more than one vote on any question submitted.\n