§ 991.2421. Organization
Purdon's Pennsylvania Statutes and Consolidated StatutesTitle 40 P.S. InsuranceEffective: September 9, 2002
Effective: September 9, 2002
40 P.S. § 991.2421
§ 991.2421. Organization
(b) Articles of incorporation.--Seven or more citizens of the United States, a majority of whom are citizens of this Commonwealth, who desire to form a fraternal benefit society may make, sign and acknowledge, before some officer competent to take acknowledgment of deeds, articles of incorporation in which shall be stated:
(3) 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 the 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.
(c) Filing.--Such articles of incorporation, duly certified copies of the society's bylaws and rules, copies of all proposed forms of certificates and applications 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 commissioner, who may require such further information as the commissioner deems necessary. The bond with sureties approved by the commissioner shall be in an amount, not less than $300,000 nor more than $1,500,000, as required by the commissioner. All documents filed shall be in the English language. If the purposes of the society conform to the requirements of this subarticle and all provisions of the law have been complied with, the commissioner shall so certify, retain and file the articles of incorporation and furnish the incorporators a preliminary certificate of authority authorizing the society to solicit members as provided in this section.
(d) Duration of preliminary certificate.--No preliminary certificate of authority granted under the provisions of this section shall be valid after one year from its date of issuance or after a further period, not exceeding one year, as may be authorized by the commissioner upon cause shown, unless the 500 applicants required under subsection (e) have been secured and the organization has been completed as provided in this section. 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 provided in this section.
(e) Solicitation of members.--Upon receipt of a preliminary certificate of authority from the commissioner, 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 applicant a receipt for the amount collected. No society shall incur any liability other than for the return of the advance premium nor issue any certificate nor pay or allow or offer or promise to pay or allow any benefit to any person until the following conditions are met:
(3) There has been submitted to the commissioner under oath of the president or secretary or corresponding officer of the society a list of the applicants, giving the name and address of each, the date each was admitted, the name and number of the subordinate lodge of which each applicant is a member and the amount of benefits to be granted and premiums for each applicant.
(4) It shall have been shown to the commissioner by sworn statement of the treasurer or corresponding officer of the society that at least 500 applicants have each paid in cash at least one regular monthly premium as provided in this subsection, which premiums in the aggregate shall amount to at least $150,000. These 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 as provided in this section, the premiums shall be returned to the applicants.
(5) The commissioner may make such examination and require such further information as the commissioner deems advisable. Upon presentation of satisfactory evidence that the society has complied with all the provisions of law, the commissioner shall issue to the society a certificate of authority to that effect and to the effect that the society is authorized to transact business pursuant to the provisions of this subarticle. The certificate of authority shall be prima facie evidence of the existence of the society at the date of the certificate. The commissioner shall cause a record of the certificate of authority to be made. A certified copy of the record may be given in evidence with like effect as the original certificate of authority.
(1) Any society organized prior to April 6, 1893, under any statute of this Commonwealth which was engaged in doing business in this Commonwealth on that date. After February 12, 1993, any such society may exercise all the rights conferred by this article and all the rights, powers, privileges and exemptions now exercised or possessed by it under its charter or articles of incorporation or articles of association, and neither its existence as a corporation nor its rights to exercise any corporate rights vested in it by virtue of its past incorporation shall be affected by anything contained in this article.
(2) Any fraternal benefit society incorporated under the provisions of the act of April 6, 1893 (P.L. 10, No. 6),1 the act of May 20, 1921 (P.L. 916, No. 324),2 the act of July 17, 1935 (P.L.1092, No.357), or the act of July 29, 1977 (P.L. 105, No. 38),3 relating to fraternal benefit societies. For the purposes of this article, a corporation which is exempt from the requirements of this section by reason of paragraph (1) shall be deemed to be a holder of a certificate of authority issued under this article.
Credits
1921, May 17, P.L. 682, No. 284, art. XXIV, § 2421, added 2002, July 10, P.L. 749, No. 110, § 9, effective in 60 days.
Footnotes
40 P.S. § 1011 et seq. (repealed).
40 P.S. § 1011 et seq. (repealed).
40 P.S. § 1141-101 et seq. (repealed).
40 P.S. § 991.2421, PA ST 40 P.S. § 991.2421
Current through Act 10 of the 2024 Regular Session. Some statute sections may be more current, see credits for details.
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