NC General Insurance Laws - Fraternal Benefit Societies

Trade Practices

Fraternal benefit societies that are authorized to do business in North Carolina must comply with the provisions of the Insurance Code relating to unfair methods of competition and unfair or deceptive acts or practices

Agent's License

Agents of fraternal benefit societies must comply with the same general laws governing licensing that apply to resident and nonresident agents

Penalties

An officer, member, or examining physician of a fraternal benefit society who intentionally makes a false or fraudulent statement in a membership application or to obtain money from a fraternal benefit society is guilty of a Class 1 misdemeanor. Soliciting membership for a fraternal benefit society that is not licensed in North Carolina is considered a Class 3 misdemeanor. The Commissioner may also impose a fine of between $1,000 and $5,000. Making a false statement under oath in a verified report or declaration that is required by law is considered a Class I felony.

Beatrice is a member of the Supreme Lodge fraternal benefit society. What must Beatrice do before she can sell insurance on its behalf?

comply with the same general licensing requirements that apply to resident agents

A fraternal benefit society may offer the following benefits to its members:

· life insurance · endowment contracts · annuities · temporary or permanent disability insurance · hospital, medical, or nursing benefits · monument or tombstone benefits to the memory of deceased members other benefits that life insurers may provide

A fraternal benefit society is a nonprofit entity that

· operates on the lodge system; · has a representative form of government; · has no capital stock · sells insurance only to its members.

Which statement regarding the licensing of fraternal benefit society agents is TRUE?

They must comply with the same licensing requirements that apply to resident and nonresident agents.