2014 -- H 7475

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LC004508

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2014

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A N   A C T

RELATING TO INSURANCE - RHODE ISLAND FRATERNAL CODE

     

     Introduced By: Representatives Keable, and Kennedy

     Date Introduced: February 13, 2014

     Referred To: House Corporations

     (Business Regulation)

It is enacted by the General Assembly as follows:

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     SECTION 1. Section 27-25-38 of the General Laws in Chapter 27-25 entitled "Rhode

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Island Fraternal Code" is hereby amended to read as follows:

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     27-25-38. Exemption of certain societies. -- (a) Nothing contained in this chapter shall

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be construed as to affect or apply to:

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      (1) Grand or subordinate lodges of societies, orders, or associations now doing business

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in this state which that provide benefits exclusively through local or subordinate lodges;

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      (2) Orders, societies, or associations which admit to membership only persons engaged

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in one or more crafts or hazardous occupations, in the same or similar lines of business, insuring

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only their own members and their families, and the ladies' societies or ladies' auxiliaries to those

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orders, societies, or associations;

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      (3)(2) Domestic societies which that limit their membership to employees of a particular

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city or town, designated firm, business house, or corporation which that provide for a death

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benefit of not more than fifteen hundred dollars ($1500) or disability benefits of not more than

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twelve hundred dollars ($1200) to any person in any one year, or both; or

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      (4)(3) Domestic societies or associations of a purely religious, charitable, or benevolent

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description, which that provide for a death benefit of not more than fifteen hundred dollars

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($1500) or for disability benefits of not more than twelve hundred dollars ($1200) to any one

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person in any one year, or both.

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      (5)(4) Any association, whether a fraternal benefit society or not, which that was

 

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organized before 1880 and whose members are officers or enlisted, regular or reserve, active,

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retired, or honorably discharged members of the Aarmed Fforces or Ssea Sservices of the United

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States, and a principal purpose of which is to provide insurance and other benefits to its members

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and their dependents or beneficiaries.

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      (b) Any society or association described in subdivision (a)(3) or (a)(4) of this section

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which that provides for death or disability benefits for which benefit certificates are issued, and

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any society or association included in subdivision (a)(4) of this section which that has more than

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fifteen hundred (1500) members, shall not be exempted from the provisions of this chapter, but

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shall comply with all of its requirements.

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      (c) No society which that, by the provisions of this section, is exempt from the

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requirements of this chapter, except any society described in subdivision (a)(2) of this section,

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shall give or allow, or promise to give or allow, to any person any compensation for procuring

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new members.

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      (d) Every society which that provides for benefits in case of death or disability resulting

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solely from accident, and which that does not obligate itself to pay natural death or sick benefits,

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shall have all of the privileges and be subject to all the applicable provisions and regulations of

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this chapter, except that the provisions of this chapter relating to medical examination, valuations

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of benefit certificates, and incontestability, shall not apply to the society.

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      (e) The commissioner of insurance may require from any society or association, by

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examination or otherwise, any information that will enable the commissioner to determine

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whether the society or association is exempt from the provisions of this chapter.

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      (f) Each association that is exempted from insurance regulation under subdivision (a)(5)

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of this section shall annually, on or before the first day of May, file with the commissioner a true

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and complete financial statement, audited by an independent, certified public accountant or

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accounting firm, of its financial condition, transactions, and affairs for the preceding calendar

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year and pay a fee of ten dollars ($10.00) for filing the same. Such an association may be required

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to file quarterly financial statements upon request by the insurance commissioner, due on or

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before forty-five (45) days after the quarter ending. Annual and quarterly statements shall be

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available for inspection by the public. If, in the opinion of the commissioner, such an association

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has not maintained assets sufficient to meet its liabilities and the minimum capital and surplus

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requirements set forth in section §27-2-5, the commissioner may order such association to

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increase its capital and surplus. If the association is unable to satisfy such order, the

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commissioner may order such association to cease and desist from assuming any additional

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liabilities in this state until such time as the association is able to satisfy the capital and surplus

 

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requirements ordered by the commissioner. Such orders shall be subject to judicial review

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pursuant to section §27-25-36.

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      (g) Societies exempted under the provisions of this section shall also be exempt from all

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other provisions of the insurance laws of this state.

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     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO INSURANCE - RHODE ISLAND FRATERNAL CODE

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     This act would remove the exemption to the provisions of the Rhode Island Fraternal

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Code granted to orders, societies, or associations which admit to membership only persons

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engaged in one or more crafts or hazardous occupations, in the same or similar lines of business,

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insuring only their own members and their families, and the ladies' societies or ladies' auxiliaries

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to those orders, societies, or associations.

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     This act would take effect upon passage.

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