17:44B-10 - Formation of domestic society
17:44B-10. Formation of domestic society
10. A domestic society organized on or after the effective date of this act shall be formed as follows:
a.Seven or more citizens of the United States, a majority of whom are citizens of this State, 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:
(1) the proposed corporate name of the society, which shall not so closely resemble the name of any society or insurance company as to be misleading or confusing;
(2) the purposes for which it is being formed and the mode in which its corporate powers are to be exercised. Those purposes shall not include more liberal powers than are granted by this act;
(3) the names and residences of the incorporators and the names, residences and official titles of all the officers, trustees, directors and 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 are 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.
b.The articles of incorporation, duly certified copies of the society's bylaws and rules, copies of all proposed forms of certificates, 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 further information that he deems necessary. The bond with sureties approved by the commissioner shall be in an amount, not less than $300,000, as required by the commissioner. All documents filed are to be in the English language. If the purposes of the society conform to the requirements of this act and all provisions of the law have been complied with, the commissioner shall certify, retain and file the articles of incorporation and furnish the incorporators a preliminary certificate of authority authorizing the society to solicit members pursuant to this act.
c.No preliminary certificate of authority granted under the provisions of this section shall be valid after one year from its date or after a further period, not exceeding one year, authorized by the commissioner upon cause shown, unless the 500 applicants required pursuant to paragraph (4) of subsection d. of this section have been secured and the organization has been completed pursuant to 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 has completed its organization and received a certificate of authority to do business pursuant to this section.
d.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 of premium collected. No society shall incur any liability other than for the return of an advance premium, nor issue any certificate, nor pay, allow, or offer or promise to pay or allow, any benefit to any person until:
(1) actual bona fide applications for benefits have been secured on 500 applicants and any necessary evidence of insurability has been furnished to and approved by the society;
(2) at least 10 subordinate lodges have been established into which the 500 applicants have been admitted;
(3) there has been submitted to the commissioner, under oath of the president or secretary, or corresponding officer of the society, a list of applicants, giving their names, addresses, date each was admitted, name and number of the subordinate lodge of which each applicant is a member, amount of benefits to be granted and premiums therefor; and
(4) it shall have been shown to the commissioner, by sworn statement of the treasurer, or corresponding officer of the society, that 500 applicants have each paid in cash at least one regular monthly premium, which premiums in the aggregate shall amount to at least $150,000 for each kind of business specified in N.J.S. 17B:17-3, N.J.S. 17B:17-4 or N.J.S. 17B:17-5 that the society is authorized to transact. The advance premiums shall be held in trust during the period of organization and if the society does not qualify for a certificate of authority within one year, the premiums shall be returned to the applicants.
e.The commissioner may examine, and require further information of, a society 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 the society is authorized to transact business pursuant to the provisions of this act. 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 that record may be given in evidence with like effect as the original certificate of authority.
f.Any incorporated society authorized to transact business in this State at the time this act becomes effective shall not be required to reincorporate.
g.No unincorporated or voluntary association shall be permitted to transact business in this State as a society.
L.1997,c.322,s.10.