SECTIONS 10970-10976 - California Statutes

INSURANCE CODE

SECTION 10970-10976

10970. Fraternal benefit societies shall be governed by this
chapter and shall be exempt from all other provisions of this code,
except:
(a) Those provisions prior to Division 1 entitled "General
Provisions."
(b) Sections 880, 881, 10112, 10114, 10117, 10118, 10119, 10120,
10171, 10172, and 10191.
(c) Article 15 (commencing with Section 1070) and Article 17
(commencing with Section 1100) of Chapter 1 of Part 2 of Division 1.
(d) Those provisions specifically referred to in this chapter to
the extent made necessary by such reference.
A statute relating to insurance shall not apply to them, unless
they are expressly designated therein.

10971. This chapter shall not, except as provided by Sections 10972
and 10974, affect:
(a) A lodge operating under the lodge system, which provides in
its bylaws or rules or regulations for the payment of death benefits
not exceeding one thousand dollars ($1,000) on the death of a member
or for the payment of disability benefits not exceeding one thousand
dollars ($1,000) to a member during any period of 12 consecutive
calendar months, or both of those types of benefits.
(b) The subordinate branch of a lodge, as a lodge is defined in
Section 10972, or any association formed by the members of a lodge,
which association confines its membership to the members of such
lodge, which subordinate branch or association (1) is organized
without capital stock, (2) is organized and operated solely for the
benefit of its members or their beneficiaries and not for profit, and
(3) provides in its bylaws or rules or regulations for the payment
of either or both of the following benefits: (i) a benefit of not
exceeding one thousand dollars ($1,000) on the death of a member from
any cause; (ii) a benefit of not exceeding one thousand dollars
($1,000) on the accidental death of a member or benefits not
exceeding one thousand dollars ($1,000) during any period of 12
consecutive calendar months to a member for his or her disability.
(c) A lodge operating under the lodge system or any subordinate
branch thereof or any association formed by the members thereof which
association confines its membership to the members of such lodge,
which subordinate branch or association (1) is organized without
capital stock, (2) is organized and operated solely for the benefit
of its members or their beneficiaries and not for profit, and (3)
provides in its bylaws or rules or regulations for the payment of
death benefits not exceeding five thousand dollars ($5,000) on the
death of a member or for the payment of disability benefits not
exceeding one thousand dollars ($1,000) to a member during any period
of 12 consecutive calendar months, or both of those types of
benefits.
(d) An organization authorized to operate pursuant to a superior
court judgment issued between January and April of 1940 whether or
not the amount of benefits offered by that organization conforms to
that judgment.
(e) Contracts of reinsurance on a plan under subdivisions (a),
(b), (c), or (d).

10972. (1) A lodge operating under the lodge system, as this term
is used in Section 10971, shall have all of the following
characteristics:
(a) It is organized without capital stock.
(b) It is organized and operated solely for the benefit of its
members or their beneficiaries and not for profit.
(c) It has a lodge system and representative form of government
within the meaning of Section 10992, holds regular meetings at
periodical intervals, and has a ritualistic form of work, and it has
not less than 10 subordinate branches with more than a total of 1,000
dues-paying, active members in good standing.
(2) Any lodge, subordinate branch or association otherwise covered
by Section 10971, which issues to any person a policy or certificate
providing for the payment of benefits, shall comply with all the
requirements of this chapter.

10973. The commissioner may require from any society such
information as will enable him to determine whether or not such
society is exempt from the provisions of this chapter.

10974. A lodge, subordinate branch thereof or association formed by
the members thereof which is exempted from the requirements of this
chapter by Section 10971 shall not give or allow, nor promise to give
or allow, any compensation for procuring new members.

10975. Any fraternal benefit society organized and operating within
the definition set forth in Sections 10990 to 10992 on July 29,
1911, providing benefits in case of death or disability resulting
solely from accidents but not obligating itself to pay death or sick
benefits, may obtain a certificate of authority under this chapter.
Such society shall have all the privileges and shall be subject to
all the provisions of this chapter, except those requiring medical
examination, valuations of policies, and that the policies specify
the amount of benefits.

10976. Any incorporated fraternal benefit society engaged on July
29, 1911, in transacting business in this State may exercise all of
the rights conferred by this chapter, and all of the rights, powers
and privileges not inconsistent with this chapter, which were
theretofore exercised or possessed by it under its charter. Any
unincorporated fraternal benefit society thus engaged may incorporate
hereunder.
A society already incorporated shall not be required to
reincorporate hereunder. Any such society may amend its articles of
incorporation. All such amendments shall be filed with the
commissioner and shall become operative upon such filing, unless a
later time is otherwise provided.