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2825 FRATE RNAL BENEFIT 208.03

CHAPTER 208

FRATERNAL BENEFIT SOCIETIES

20801 Fraternal benefit societies defined . . 208 . 17 Ben e fits not attac hable . 20802 Proxies, mail voting 208 18 Nonreserve . 20803 Laws applicable. 208 19 Classes of members 20806 Old societies . 20820 Old societies , special license . 20807 What laws apply . 20821 Licensing of agents , 208 09 Admission to membership ; benefits; 20823 Amendment of artic l es . . contributions for same, reserves, change of 20824 License necessary, beneficiaries 208 . 25 Admission of foreign s ocieties . 208 . 10 Beneficiary . 20827 Trusts and agreements as to proceeds of 20811 Dividends . ; 208 12 Investments 20828 Benefit societies ; annual report, valuation . 208 . 13 Funds. 20829 Benefit societies , valuations . 208 14 Fraternal benefit societies; . 20834 Revocation of license, costs, 208 . 15 Rates . 208 . 35 . Tax exempt , special assessments, f i ling fees. 208 16 The contract 208 38 Fraud in obtaining membership . 208 . 161 Life benefit certificate provisions standard and 20839 Conversion of fraternal benefit society into p r ohibited , mutual company. 2081b2 Accident and and total and 208 . 40 Consolidations and mergers. permanent certificates .

208.01 Fraternal benefit societies de- resentatives or delegates shall be held as often as fined. (1) Any , society, order or once in 4 years, association, without capital stock, organized (4) The directors, trustees and officers of 'a and carried on solely for the mutual benefit of fraternal benefit society may be elected or xe- its members or their beneficiaries and having a elected for a term of office not to exceed 4 years . lodge system with ritualistic form of work and representative form of government, and which 2U8.02 Proxies , mail votin g. No mutuall makes provision for the payment of death, disa- benefit society shall permit voting by proxy, but bility, annuity or endowment benefits, or any may provide for voting by mail . combination of such benefits, is hereby declared to be a "Mutual Benefit Society," which shall 208.03 Laws applicable . (1) Unless express be held to be synonymous with a "Fraternal reference is made thereto, no Benefit Society.." Domestic societies licensed to shall apply to societies which admit to member- do business in this state as mutual benefit socie- ship only persons engaged in one or more haz- ties on May 1, 1911, shall be considered within ardous occupations in the same or similar lines this subsection. of business and their immediate families and de- (2) Any such society having a supreme gov- pendents; nor to an association of local lodges erning body and subordinate lodges or branches, of a society doing business in this state on May into which' members shall be elected, initiated 27, 1911, which provides death benefits not ex- and admitted in accordance with its constitu- ceeding $300 to any one person or disability tion ; laws, rules, regulations and prescribed ritu- benefits not exceeding $300 in any one year to alistic ceremonies, which lodges or branches are any one person or both ; nor to any contracts of required by its laws to hold regular meetings, on such plan ; nor to domestic socie- shall- be deemed to be, operating on the lodge ties which limit their membership to the em- system.. ployes of a particular municipality or one desig- (3) Any such society shall be deemed to have nated employer and their immediate families a representativee form of government if it pro- and dependents; nor' to domestic lodges, orders vides a supreme governingg body composed of or associations of a purely religious, charitable representatives elected by the members or by and benevolent description, which do not pro- delegatess elected: by the members, together with vide for a death benefit exceeding $300 or for such other members as may be prescribed by its disability benefits of more than $150 to any one constitution and laws: Provided the elective person in any one year nor to firemen's associa- members shall constitute a majority and have tions organized for mutual aid, training of not less than two-thirds of the votes nor less than members and education in fire fighting andd fire the votes requiredd to amend its constitution and prevention. But any such order or society, ex- laws; and provided the meeting of the supreme cept societies which admit to membership only governing body and the election of officers, rep- persons engaged in one or more hazardous oc- Electronically scanned images of the published statutes.

208.03 FRATERNAL BENEFIT SOCIETIES 2826

cupations in the same or similar lines of ' business and may in like manner admit general or social and their immediate families and dependents, members . Any such society may provide in its and firemen's associations, which has more than laws for the payment to its members of benefits 500 members and provides for death or disabil- for the disability of such members, their minor ity benefits or which issues a certificate piovid- children and their spouses . ingfox' the payment of benefits shall comply with (2) (a) A fraternal benefit society may provide all the requirements of law relating to mutual in its laws, in addition to other benefits provided benefit societies . for therein, for the payment of 'benefits upon the (2) No insurance law shall apply to domestic lives of members, or upon application of a mem- benevolent societies organized prior to and in bei; on the lives of' the member's family, includ- continuous operation each year since January 1, ing the member and the member's spouse and 1935, which maintain no lodges or ritualistic for the payment of benefits upon the lives of' organization and which operate upon the plan of children at any age upon the application of per- collecting an assessment upon the death of a sons as the laws of the society may provide .. Any member, provided benefits paid shall not exceed such society may, at its option, organize and $2,000 upon the death of any member . No such operate branches for such children, and mem- society shall have a total membership of more bership in local lodges, and initiation therein than 2,000 members and in no event shall it shall nott be required of such children, nor shall increase its membership beyond that which it they have any voice in the management of the had in good standing on July 1, 1945. Officers of society.. . benevolent societies operating under this section (b) The contributions for such benefits below shall obtain and furnish a bond of not less than age sixteen shall be based upon the Standard $5,0000 for the faithful performance of their du- Industrial Mortality Table or the English Life ties. Table number six or the American Exper ience (4) Section 208„ 162 shall not apply to any fra- Table with Craig's Extension, with a rate of in- ternal benefit society wherein the annual total teiest not exceeding four per cent, or such mor- dues for each member ; including any assess- tality table as may be approved by the commis- ments, do not exceed $20 per annum and the sioner of" insurance. officers of the Wisconsin unit or division are (c), Any society granting such benefits shall annuallyy elected by its members and are resi- maintain on all such contracts the reserve xe- dents of Wisconsin. quiied by the standard of mortality and interest (5) Sections 206.385, 206,386 and 206 .39 shall adopted by the society withinn the limitations apply to fraternal benefit societies .. prescribed in paragraph (b) of this subsection, (d) Such society shall have power to provide 208.06 Old societies. Any mutual benefit for designation or change of' beneficiaxies, and society organized prior to May 27, 1911 ; and for thee regulation, government, and control of providing for benefits in case of death or disa- all matters connected with the granting of such bility resulting solely from accidents,, but which benefits. does not obligate itself to pay death or, sick ben- efits, may be licensed under this chapter, and 208.10 Beneficiary. Any member may shall have all the privileges and shall be subject name as his beneficiary any person permitted by to all the provisions and regulations of this the laws of such society, including his estate .. chapter,, except that the provisions thereof ie- Any member' may change his beneficiary with- quiring medical examinations, valuations of out the consent of such beneficiary, by comply- benefit certificates, and that the certificate shall ing with the laws of the society: specify the amount of benefits, shall not apply to such society.. 208.11 Dividends. No mutual benefit soci- ety shall issue any certificate or policy in which 208.07 What laws apply. Unless express the accounting, apportionment and distribution reference is made to this chapter or unless ex- of any profits ; savings, earningss or surplus shall piessly designated, no law shall' apply to any be deferred-for a longer period than one year mutual benefit society . 208.12 Investments. 'Evei,y mutuall benefit 208.09 Admission to membersh ip; bene- society shall invest itss funds only in securities fits; contributions for same , reserves, permitted for the investment of the assets of life change of beneficiaries . (1) Any fraternal insurance companies subject to all of the condi- benefit society mayadmit to beneficial member- tions and restrictions of the statutes applicable ship such persons under, such conditions and thereto, including seetion201 .24;:but any such for such benefits as its laws may prescribe, sub- foreign society may invest its funds in accord- ject to the limitations prescribed under ch . 208 ance with the laws of the state in which it is I! u Electronically scanned images of the published statutes.

2827 FRATERNAL' BENEFIT SOCIETIES 2 08.16

incorporated ; provided that not exceeding 20 are not provided for in the rates so deduced from per cent of the assets of any society may be said table of mortality must be amply p rovided invested in a building for use as its home office.. for in addition to the rates as herein required . (3) Every domestic mutual benefit society 208. 13. Funds. All assets shall be held, in- shall provide in its constitution or laws that if vested and disbursed for the usee and benefit of the society's reserves as to all or any class of the society and no member' or beneficiary shall certificates become impaired, the board of direc- have or acquire individual rights therein or be- tors or corresponding body may require that come entitled to any apportionment or the sur- there shall be paid by the member to the society render of'any part thereof, except as provided in the amount of the member's equitable propor- the contract. A society may create, maintain, tion of such deficiency as ascertained by its invest, disburse and apply any special fund or board, and that if the payment is not made, it funds necessary to carry out any purpose per- shall stand as an indebtedness against the certifi- mitted by the laws of such society .. cate and .d draw interestt not to exceed 5% per annum compounded annually, or in lieu thereof, 208.14 Fraternal benefit societies ; organ- in combination therewith the member may . (1) A mutual benefit society may be or, ization consent : to an equivalent reduction in benefits . incorporated as provided in chapter 201 . Before suchh society shall be licensed to transact busi- (4) Whenever, on and after January 1, 1940, the assets of any mutual benefit society shall not ness at least 500 persons shall have made appli- ves on the mortal- cation in writing for membership therein and equal its liabilities and its reset ion each shall have made application for at least ity and interest basis prescribed by subsect except that a foreign society $500 of life insurance and shall have been ex- (1) of this section, amined and recommended as insurable by a le- may calculate its reserves as provided in subsec- gally qualified physician and shall have paid the tion (2) of " section 208 ..28, the society shall, rate required for one year of insurance .. No li- within sixty days, provide assets equal to such cense shall be issued unless the aggregate pay- liabilities and reserves and, on its failure so to do, ments for mortuary purposes amount to at least the commissioner shall fix a time, of which writ- $10,000 ten notice shall be given to the society, after (2) Any mutual benefit society organized un- which no contracts or policies shall be issued in der the laws of this state shall maintain an in- this state by the society until its assets shall equal sured membership of at least 500 members with its liabilities and its reserves . not less than $250,000 of life insurancee during (5) Any society electing to computee its rates the first year following the issue of its license and and reserves upon the basis of the commissioners shall have at the close of the second year follow- 1941 standard ordinary mortality table or the ing the issue of its license not less than 1,000 commissioners 1958 standard ordinary mortal- insured members with not less than $500,000 of ity table, and an interest assumption permitted life insurance and at the close of the fourth year for life insurance companies, shall compute the following the issue of its license and thereafter at value of benefits granted upon forfeiture or least 2,000 insured members with not less than change in the contract in accordance with s .. $1,000,0000 of life insurance. 206.181. 208.15 Rates . (1) No mutual benefit society 208. 16 The contract. (1) Every society au- shall be incorporated or permitted to transact thoiized to do business in this state shall issue business in this state unless its laws require reg- to each benefit member a certificate or other, ular payments at rates to provide for mortality instrument specifying the amount of benefits andd reserves not lower than those derived from provided thereby . The certificate or other in- the national fraternal congress mortality table, strument, together withh any riders or endorse- computed upon an interest assumption of 4 per ments attached thereto, the charter or articles cent per annum, (except that a foreign society of incorporation, the constitution and laws of may calculate its reserves as provided in s . the society, the application for membership, 208.28 (2)), unless it elects to compute its rates and declaration of insurability, if any, signed by and reserves upon the basis of a mortality table the applicant, and all amendments to each and interest assumption permitted for life insur- thereof, shall constitute the agreement, as of the ance companies, nor unlesss it holds assets suffi- date of issuance, between the society and the cient to provide for its other liabilities and its member, and the certificate or other instrument reserve liability, upon its own plan and assump- shall so state .. A copy of the application for tiohs within the foregoing limitations .. membership and of the declaration of insuiabil- (2) The payment of any disability benefits ity, if any, shall be endorsed upon or attached promised or rendered by any such society that to the certificate or other instrument . Electronically scanned images of the published statutes.

208.16 FRATERNAL BENEFIT, SOCIETIES 2828

(2) All statements purporting: to be made by of such overdue paymentss mayy be deducted in the member shall be representations and not any settlement under the certificate ; warranties Any waiver of this provision shall be (d) :A provision that the member shall be enti- void.. tled to have the certificate reinstated at any time (3) Any changes, additions or amendments to within 3 years from the due date of the premium the charter or articles of'incorporation ; constitu- in default, unless the certificate has been com- tion or laws duly made or enacted subsequent to pletely terminated through the application of a the issuance of the certificate, shall bind the nonforfeiture benefit, cash surrender value or member and the beneficiaries, and shall govern certificate loan, upon the production of evidence and control the agreement in all respects the of insurability satisfactory to the society and the same as though such changes, additions or payment of all overdue premiums and any other amendments had been made prior to and were in indebtedness to the society upon the certificate, force at the time of the application for member- together with interest on such premiums and ship, except that no change, addition or amend- such indebtedness, if any, at a rate not exceeding ment shall destroy or diminish benefits which 6% per annum compounded annually; the society contracted to give the member as of (e) Except in the case of pure endowment, the date of issuance, but such exception shall not annuity or reversionary annuity contracts, re- apply with respect to benefits provided under a ducing term insurance contracts, or contracts of contract f'or, an indefinite term by a society term insurance of uniform amount of 15 years or whose member's are limited to employes of a less expiring before age 66 a provision that, in designated employer. - the event of default in payment of any premium after 3 fall years' premiums have been paid or (4) Copies of'any of the documents mentioned after' premiums for a lesser period have been in this section, certified by the secretary or cor- paid if the contract: so provides, the society Will responding officer of` the society, shall be re- grant,. -uponn proper request not later than 60 ceived in evidence of the terms and conditions days ' after, the due date of the premium in de- .. thereof fault, a paid-up nonPorfeiture benefit on the plan 208.161 Life benefit certificate provi - stipulated in the certificate, effective as of such sions standard and prohibited . On and after due date, of such value as specified in this chap- January 1, 1966, no life benefit certificate shall ter . The certificate may provide, if the society's be delivered or issued' for delivery in this state laws so specify or if" the member so elects prior unless a copy of the form has been filedwith the to the expiration of the grace per iod of any over- due premium,' that default shall not occur so commissioner of insurance, and approved by long as premiums can be paid under the provi- him as conforming to the requirements of this sions of ' an arrangement for automatic premium section and not inconsistent with any other pro- loan as may be set forth in the certificate; visions of law applicable thereto . A certificate (f) A provision that one paid-up nonforfeiture shall be deemed approved unless disapproved benefit as specified in the certificatee shall be- by thee commissioner of insurance within 30 come effective automatically unless the member days from the date of such filing. elects another available paid-up nonforfeiture (1) The certificate shall contain in substance benefit, not later than 60 days after the due date the following standard provisions or, in lieu of the premium in default; ' thereof, provisions which are more favorable to (g) A statement of the mortality table and rate the member : of interest used in determining all paid-up non- (a) Title on the face and filing pagee of the forfeiture benefits and cash surrender options certificate clearly and correctly describing its available under the certificate, and a brief ' gen- form; _ eral statement of ' the method used in calculating (b) A provision stating the amount of rates, such benefits; . premiums or other required contributions, by (h) A table showingg in, figuxes the value of whateverr name known, whichh are payable by the every paid-up nonforfeiture benefit and cash sur- insured under the certificate; render option available under the certificate fox (c) A provision that the member is entitled to each certificate anniversary either dur ing the a grace period of not less than a full month. (or first 20 certificate years or during the term of the 310 days at the option of the society) in which the certificate whichever is shorter, payment, of any premium after thee first, may be (i) A provision that the certificate shall be nude. During such grace period the certificatee incontestable after it has been in force during the shall continue in full force, but in case the certifi- lifetime of the member for a period of '2 years cate becomes a claim during the grace period from its date of issue except for nonpayment of before the overdue payment is made, the amount premiums,:violation of the provisions of ' the cer- Electronically scanned images of the published statutes.

2829 FRATERNAL BENEFIT SOCIETIES 208 .162

tificate relating to military, aviation, or naval (2) On and After January 1, 1966, no life bene- service and violation of the provisions relating to fit certificate shall be delivered or issued for de- suspension or expulsion as substantially set forth livery in this state containing in substance any of in the certificate:. At the option of the society, the :following-provisions supplemental provisions relating to benefits in (a) Any provision limiting the time within the event of`temporay or permanent disability which any action at law or in equity may be or hospitalization and provisions which giant commenced to less than 2 years after the cause additional insurance specifically against death of action accrues ; by accident or accidental means,' may also be (b) Any provision by which the certificate excepted . ' The certificate shall be incontestable purports to be issued or to take effect more than on the ground of suicide after it has been in force 6 months before the original application for the during the lifetime of the member for a per iod of certificate was made, except in case of transfer 2 years from date of issue .. The certificate may from, one form of certificate to another in con- provide, as to statements made to procure a rein- nection with which the member is to receive statement, that the society shall have the right to credit for any reserve accumulation under the contests reinstated certificate within a period of form of' certificate from which the transfer is 2 years from date of reinstatement with the same made; or exceptions as herein provided; (c) Any provision for forfeiture of the ceitifi- (j) A provision that in case of age or sex of the cate for failure to repay any loan thereon or to member or of and other person is considered in pay inter est on such loan while the total indebt- determining the premium and it is found at any edness, including interest, is less than the loan time before final settlement under the certificate value of the certificate ., that the age or sex has been misstated, and the (3) The word "premiums" as used in this discrepancy and premium involved have not chapter means premiums, rates or' . other- re- been adjusted, the amount payable shall be such quired contributions by whatever name known.. as the premium would have purchased at the correct age and sex; but if the correct age or sex 208. 162 Accident and health insurance was not an insurable age or sex under' the socie- and tots( and permanent disabilityy insur- ty's' charter or laws, only the premiums paid to ance certificates. No domestic, foreign or the society, less anyy payments previously made alien society authorized to `do business in this to the member, shall be returned or, at the op- state shall issue or, deliver' in this state any cer- tion of the society, the amountt payable under the tificate or other evidence of any' contract of ac- certificate shall be such as the premium would cident insurance or health insurance or of any have purchased at the correct age and sex ac = total And permanent disability insurance con- cording to the society's promulgated rates and tract unless and 'until the form thereof, together any extension thereof based on actuarial piinci- with the form of application and all riders or ples; endorsements for use in' 'connection therewith, (k) A provision or provisions which recite has-been filed with the commissioner of insur- fully, or which set forth the substance of, all ance,' and approved by him as conforming to sections of the charter, constitution, laws, rules reasonable rules and regulations made by him or regulations of the society, in force at the time and as not inconsistent withh any other provi- of issuance of the certificate, the violation of sions of law applicable thereto The comms= which will result in the, termination of, or in the signer of "insurance shall, within a reasonable reduction of, the benefit or: benefits payable un- time after the filing of any 'such form, notify the der the certificate ; and society filing the same either 'of his approval or (1) If'_the constitution or : laws of the :society of his disapproval of "such `form The commis- providee for expulsion', ox suspension of a mem- sioner of insurance may approve any such form ber; a provision that any member so expelled` or which in his opinion contains provisions on any suspended, except for nonpayment of 'a premium one of more of the several requirements made or within the contestable period fox material by him which are more favorable to the mem- misrepresentations in such member's , applica- bers than the ones so required ; The commis- tion for membership shall have the pr ivilege of sioner' of insurance shall have power to make; maintaining his insurance in force by continuing alter and supersede reasonable regulations pre- payment of the required premium.. . scribing the required, optional and prohibited (m) Any of the foregoing provisions or por- provisions in such contracts, and such regula- tions thereof not applicable by reason of the plan tions shall conform;: as far as practicable, to s, of"insurance or because the certificate is an an- 204,31 (1) to (9) {204..31 (1) to (7)] . Where the nuity certificate may, to the extent inapplicable, commissioner of insurance deems inapplicable, be omitted from the certificate . either in part or in their, entirety, the provisions Electronically scanned images of the published statutes.

208.162 FRATERNAL BENEFIT SOCIETIES 2830 of the foregoing sections,, he may prescribe the to classes established prior to June 27, 1915, portions or summary thereof of-the contract to nor to accident insurance, be printed on the certificate issued to the mem- ber. Any filing made hezeunder, shall be deemed 208.20. Old societies, special l icense. (1) approved unless disapproved .-within : 30 days Any mutual benefit society having members re- from the date of such filing . siding in this state on the . first day of May, 1911? shall, without complying with the re- 208.17 Benefits not attachable. No quirements of sections 208,15 to 208,19 but money or other benefit, charity, relief or aid to upon complying with the other requirements of be paid, provided or rendered by any society, law be entitled to transact insurance with such shall be liable to attachment, garnishment or members and with members who shall come other process, or to be seized, taken, appropri- into this state after havingg become such mem- ated or applied by any legal or equitable process bers. or operation of law to pay any debtt or liability (2) If such society shall not comply with the of a member or beneficiary, or any other person requirements of said sections it shall not solicit, who-may have a right thereunder, either before receive or accept new members in this state until or after payment by the society . it shall have received the license : of the commis- sioner therefor, issued after examination by him, 208. 18 Nonreserve soc iety. A mutual andd due proof is filed with him that such society benefit society may be organized for the tians- has incorporated into its charter, articles or by- action of business on a plan set forth in the laws a provision that from such date new mem- contract which provides for sufficient contribu- berswill be solicited, received or accepted within tions by each member in each year to pay his this state only according to the provisions of said share of the actual death claims of the year sections, and that the amount of'funds necessary through the collection of assessments graded to meet the reserve liability on each policy or according to the National Fraternal Congress certificate of such new members shall be kept Mortality Table, or to any other mortality table separate from other funds in trust for each such recognized by law, without any reserve, or with member, and shall be used only for' the purpose such reserve as may accumulate from overpay- of maintaining such reserve and maturing such policies or certificates, and that a policy or cer- merits of individual members, in which case tificate shall be issued to each member reciting each member shalll each year be informed of his the foregoing conditions and specifying the pre- credit and of the charge of his cost of insurance .. mium, and that assessments, if any, shall be lev- ied only in the manner and for the specific pur- 208.19 Classes of members. Any domes- poses therein enumerated. tic mutual benefit society may establish and maintain two or more separate classes of mem- (3)When such society shall in all respects as to all its members have complied with the re- beis subject to the conditions and restrictions following and to such as may be prescribed in quirements of'said sections it shall no longer be required to keep such funds separate as required its articles of by-laws. The proceeds of assess- by subsection (2) . ments (other than for expense, purposes) and the apportioned funds or reserves maintained 208.2'1 Licensing of agents. (1) Agents of for .each class shall be kept separate from other- mutual bene fit societies shall be licensed in ac- funds, ' and all. claims on certificates held by coidance with the procedure for licensing` life members in any class shall be paid only from insurance agents under s . 206,41, except that funds belonging to such class ; provided that the examination requirements of said section transfers of gains, from interest or investments, shall not apply to any agent who is an agent of or of savings in, mortality, or of gains from for- such -a society immediately prior, to October 2, feitures, may be made between classes of merri- 1963. , - bets as authorized in the by-laws; and provided (2) In this section "agent" means any author- that for the purpose of apportioning death ized or acknowledged agent of a society who acts losses to the various classes, the mortality may as such in the solicitation, negotiation or pro- be merged as authorized in the by-laws . Pursu- curement or making of a life insurance, accident ant to the by-laws any member may be permit- and health insurance or annuity contract, except ted to transfer from a lower to a higher rate that "agent" shall not include: class and to have transferred with him to such (a) Any regular salaried officer or employe of other class such part of any accumulated funds a licensed society who devotes substantially all held ,for such member. No such classification of his services to activities other than the solici- shall be rescinded or discontinued. The forego- tation of insurance contracts from the public, ing conditions and restrictions shall not apply and who receives for the solicitation of'such con- Electronically scanned images of the published statutes.

2831 FR ATERNAL BENEFIT SOCIETIES 2 08.27

tracts no commission or other compensation di- shall, so long as any contract remains in force, rectly dependent upon the amount of business make such annual reports as are required during obtained ; or the year previous to the last year of its being (b) Any agent or representative of a society licensed, or at its option as thereafter required by who devotes, or intends to devote, less than 50 law,. per cent of his time to the solicitation and pro- curement of insurance contracts for such soci- 208.25 Admission of foreign societies. ety Any person who in the preceding calendar Any foreign mutual benefit society may be li- year has solicited and procured life insurance censed to transact business in this state, upon contracts on behalf of any society in an amount an examination by the commissioner, which of insurance in excess of $50,000, or, in the case shall be made after the filing with him of : of any other' kinds of insurance which the society (1) A duly certified copy of its charter or arti- might write,, on the persons of more than 25 cles of association ; individuals and who has received or will receive (2) A copy of its by-laws and of any other a commission or other compensation therefor, constitution and laws, certified by its secretary shall be presumed to be devoting, or intending to or corresponding officer;. devote, : 50 per cent of his time to the solicitation (3) A power of attorney to the commissioner or procurement of insurance contracts for such as herein provided; society . (4) A certificate from the proper official in its home state or countryy that the society is legally 208.23 Amendment of articles. The arti- organized and licensed to transact business cles of organization of any mutual benefit soci- therein ; ety may be amended as prescribed herein, any (5) Each of its forms of contracts which must provisions contained in the articles of organiza- tion notwithstanding. In case of any society each show that benefits are provided for by peri- odical or other payments by persons holding having subordinate lodges or other divisions, af- ter, the proposed amendment hass been filed with such contracts; the office of the commissioner of insurance and (6) A statement of its business under oath of a copy thereof with notice of the manner and its president and secretary or corresponding offi- the time and place of voting' has been mailed to cers, in the form required by the commissioner, each member at least 30 days prior to the time showing that it complies withh all the provisions for voting, the vote on such amendment may be of law relating to like domestic societies; taken at the usual meeting places of such lodges (7) Such other information as he mayy deem or other, divisions, and the results returned and necessary to a proper exhibit of its business and canvassed in such manner as the board of direc- plan `of' working, and torsor other governing officers may prescribe (8) A statement signed' by its president and in such notice ; The time and place of voting secretary, or corresponding officers, including a may be specified by referring to a stated meet- copy of a resolution of its board of directors or ing of such subordinate lodge or other division other governing body, authorizing the same; in such manner as to fully inform the inembexs . that it wil l file its annual report as required by An amendment may 6e adopted by'a vote of a s. 601' 42„ majority of the members voting thereon, 208.27 Trusts and a greements as to pro- 208.24 License necessary. (1) No mutual ceeds of insurance. Any mutual benefit soci- benefit society shall transact any business with- ety doing business in this state may hold the out a license from the commissioner . Such li- proceeds of any certificate issued by it under a cense-and any renewal thereof shall terminate trust, or other: agreementt upon such terms: and on the first day of the succeeding April, pro- restrictions as to revocation by the member and vided that the

208.28 FRATERNAL BENEFIT SOCIETIES 2832

208.28 Benefit societies; annual report , ber with the net amount contributed for each valuation . (1) As a part of its annual statement year and with interest at approximately the net every mutual benefit society shall report a valu- rate earned, and by charging him with his share ation of its certificates in force as of the end of of the losses for each ,year .. each year.. Such valuation shall be certified by a (b) The charge may be according to the actual competent accountant or actuary, or at the re- experience of the society applied to a table of quest and expense of the society, verified by the mortality recognized by the law of'this state, and actuary of the department of insurance of the shall take into consideration the amount at risk home state of the society .. The time for filing during each year-, which shall be the amount such valuation may be extended by the commis- payable at death less the credit to the member . sioner not exceeding ninety days . (c) Except as specificallyy provided in its arti- (2) The legal minimum standard of'valuation cles or laws or contracts, no charge shall be for all certificates of life or endowment insur- carried forward from the first valuation against ance shall be the national fraternal congress ta- any member for any past share of losses exceed- ble of mortality, or, at the option of the society, ing the contributions and credit . any higher table or anytable authorized by s . (d) If, after the first valuation, any member's 206.20 or 206 .201 for such benefits, or a table share of losses for any year exceeds his credit based upon the society's own experience of at including the contribution for the year, the con- least 20 years and covering not less than 100,000 tribution shall be increased to cover the excess . lives . Contracts for annuity or pure endowment (e) Any suchh excess chargeable to any mem- benefits, for total and permanent disability bene- ber may be paid out of a fund or contributions fits in or supplementary to ordinary contracts, especially required for such purpose..' or for accidental death benefits in or supplemen- (2) Any member may transfer to any . plan taiy to ordinary contracts shall be valued in ac- adopted by the society with net rates on which cordance with s. 206 201 (2) (c), (e) and (t), tabular reserves are maintained, and on such Interest assumptions shall not be more than 3 transfer, shall be entitled to make such applica- 1/2 per cent per annum . Each report shall set tion of his credit as providedin the laws of'. the forth fully thee mortality and interest basis and society . the method of valuation. (3) Certificates issued, rexated or readjusted (3) Any society providing for disability bene- on a basis providing for adequate rates with ade- fits shall keep the net contributions for such ben- quate reserves to mature such certificates upon efits separate and apart from all other funds and assumptions for mortality and interest recog- thee valuation of all other business of the society ; nized by the law of this state shall be valued on provided that where a combined contribution such basis, herein designated the "Tabular Ba- table is used by a society . for both death and sis;" provided that if on the first valuation a permanent total disability benefits, the valuation deficiency in reserve shall be shown for- anyy such shall be according to tables of experience, ap- certificate, it shall be valued on the accumula- proved by the commissioner, and in such casee a tion basis .. separation of the funds shall not be required (4).Whenever in any society having members (4) Eachh society shall be held to be: legally upon the tabular basis and upon the accumula- solvent so long as the admitted assets are equal tion basis the total of all costs of insurance pro- to itss reserve and other liabilities .. vided for any year shall be insufficient to meet (5) A report of'such valuation and an explana- the actual death.h and-disability losses for the year tion of the condition of the society thereby dis- the deficiency shall be , met from the available closed shall be printed and mailed by the society funds after setting aside alll credits in the r eserve, to each beneficiary member not later than the or from increased contributions or by an in- first of July of each ,year, or, in lieu thereof, such crease in the number of assessments, applied to report and explanation may be published in the the society, as a whole or to classes of members, society's official paper and the issuee containing as may be specified in , its laws . Savings from a the same mailed to each beneficiary member . lower amount of death losses may be returned in like manner as may be specified in its laws .. (6) This section shall not apply to any foreign so provide the society issuing no certificate in excess of $500 (5) If ' the laws of the societyy and licensed before January 1, 1911 .. assets representing the reserves of any class of members may be carried separately for such 208.29 Benef it societies, valuations. (1) class, and the required reserve accumulation of (a) In lieu of the, valuation requirements of sec- such class so set apart shall not thereafter be tion 208..28, any society : accepting . the piovi- mingled with 'the assets of other classes. sions of this section may value its certificates on (6) A table showing the credits to individual an accumulation basis; by crediting eachh mem- members for, each age and year of entry, and Electronically scanned images of the published statutes.

2833 FRATERNAL B ENEFIT S OCI ETI ES 208.4 0

showing opposite each credit the tabular reserve less than $100 nor more than $1,000, or impris- required on the whole life or other 'r plan of insur- oned in thee county jail not less than 3 months ance specified. in the contract, according to as- nor, mote than one year, or both; and any ceitif= sumptions for mortality and interest recognized icate of membership or policy so secured; shall by the laws of this state and adopted by the be absolutely void . society, shall be filed by the society with each annual report and also be furnished to each 208. 39 Conversion of fratern al benefit member before July first of ` each year.. society into mutual life insurance company . (7) In lieu`of the statement required by subsec- Any domestic fraternal benefit society (on a sol- vent basis according to a recognized table of tion (6) there may be furnished to each member mortality acceptable to the commissioner of in- within the same time a statement giving the surance) may be converted and licensed as a credit for such member and giving the tabular mutual life insurance company, if such plan of reserve and level rate required for `a transfer car- conversion has been approved by the commis- tying out the plan of insurance specified in the sioner of insurance Such plan shall be prepared contract . No table or statement need be made or in writing setting forth in full the terms and furnished where the reserves are maintained on conditions thereof. The board of directors shall the tabular basis . submit such plan to the supreme legislative or (8) Bookkeeping accounts for each member governing body of such society at any regular shall not be required and all calculations may be or special meeting thereof, by giving a full, true made by actuar ial methods .. and complete copy of such plan with the notice (9) This section shall not prevent the mainte- of such meeting. Suchh notice shall be given as nance of such surplus over and above the credits provided in the laws of the society for the con- on the accumulation basis and the reserves on vocation of a regular or special meeting of such the tabular basis as the society may provide pur- body, as the case may be The affirmative vote suant to its laws; nor give to the individual mem- of'two-thirds of all members of such body shall ber any right or claim to any such reserve or be necessary for the approval of such agree- credit other than in the manner expressed in the ment. No such conversion shall take effect un- contract and its laws; nor make any such reserve less and until approved by the commissioner of or credits a liability in determining the legal sol- insurance who may give such approval if he vency of the society , finds that the proposed change is in conformity with the requirements of law and not prejudi- 208.34 Revocation of license , costs. The cial to the certificate holders of the society .. commissioner shall revoke the license of any so- ciety which fails to comply with the require- 208.40 Consolidations and mergers . A ments of law; and all necessary expenses in- domestic society may consolidate or merge with curred by himm and by the department of justice any other society by complying with the provi- in enforcing such requirements or in prosecut- sions of this section. ing violations thereof shall be paid out of the (1) It shall file with the commissioner of insur- general fund, on being certified to the secretary ance: of state that they were actually and necessarily (a) A certified copy of the written contract incurred for the purpose stated.. containing in full the terms and conditions of the consolidation or merger; 208.35 Tax exempt, special assess - ments , filing fees . Every mutual benefit soci- (b) A sworn statement by the president and ety, shall be exempt from all state, county, dis- secretary or corresponding officers of each soci- trict, municipal and school taxes or fees, except ety showing the financial condition thereof on a the fees as required by s . 601 .31 (25), but shall date fixed by the commissioner of"insurance but be required to pay all taxes and special assess- not earlier than December 31, next preceding ments on itss real estate and office equipment, the date of the contract ; except as provided in s . 70 .11 (4) and (8) . (c) A certificate of such officers, duly verified by their respective oaths, that the consolidation 208.38 . Fraud in obtainin g membership. of merger has been approved by a two-thirds Any person who knowingly or wilfully makes vote of the supreme legislative or governing any false or fraudulent statement or representa- body of each society ; and tion in or with reference to any application for (d) Evidence that at least 60 days prior to the membership or in or with reference to any doc- action of the supreme legislative or governing umentary or other' proof" for the purpose of ob- body of each society, the text of the contract has taining membership in or benefit from any such been furnished to all members of" each society corporation, society, order or association, for either by mail or by publication in full in the himself or any other person, shall be fined not official organ of'`each society. Electronically scanned images of the published statutes.

208.40 FRATERNAL BENEFIT SOCIETIES 2834

(2) If the commissioner of'insurance finds that (3) Upon, the consolidation or merger becom- the contract is in conformity with this section, ing effective as herein provided, all the rights, that the financial statements are correct and that franchises and interestss of the consolidated or the consolidation or merger is just and equitable merged societies in and to every species of 'prop- to the members of"each society, he shall approve erty, real, personal or mixed, and things in ac- the contract and issue his certificate to such ef= tion thereunto belonging shall be vested in the fect Upon such approval, the contract shall be society resulting ; from or remaining after the in effect unless any society which is a party to consolidation or merger without any other in- the contract is incorporated under the lawss of strument, except thatt conveyances of reall prop- . such eventt the eity may be evidenced by proper deeds, and the any other, statee or, territory . In consolidation or merger shall not become effec- title to any real estate or, interest therein, vested true unless and until it has been approved as under the laws of this state inany of the societies .h state or territory consolidated or merged,, shall not revert or be in provided by the laws of such any way impaired by reason of the consolidation and a certificate of such approval filed with the or, merger, but shall vest absolutely in the society commissioner of insurance of this state or, if the resulting from or remaining after such consoli- laws of such state or territory contain no such dation or merger, provision, then the consolidation or merger shall (4) The affidavit of any officer of thee society not become effective unless and until it has been or, of anyone authorized by it to mail any notice approved by the commissioner of insurance of or document, stating that such notice or docu- such state or territory and a certificate of such ment has been duly addressed and mailed, shall approval filed with the commissioner of irisur- be prima facie evidence that such notice or docu- ance of this state.e ment has been furnished the addressees