Massachusetts General Laws
Chapter 176p - Limited Societies
Section 8 - Lodge Plan; Preliminary License; Solicitation of Members; Collection of Payments; Minimum Membership; Issuance of Certificate

Section 8. (a) The commissioner shall then furnish the incorporators of any such society, if on the lodge plan, with a preliminary license, authorizing it to solicit members for the purpose of completing its organization.
(b) A society shall collect from each applicant the amount of not more than one periodical benefit assessment or payment, in accordance with its tables of rates as provided by its constitution and by-laws, and shall issue to every such applicant a receipt for the amount so collected. But no such society shall incur any liability other than for such advance payments, nor issue any benefit certificate, nor pay or allow or offer or promise to pay or allow, to any person any death or disability benefit until:
(1) actual bona fide applications for death or disability benefit certificates, as the case may be, have been secured from at least 500 persons; and
(2) all such applicants for death benefits have been regularly examined by legally qualified practicing physicians; and
(3) certificates of such examinations have been duly filed and approved by the chief medical examiner of the society; and
(4) ten subordinate lodges or branches have been established in which such 500 applicants have been initiated; and
(5) there has been submitted to the commissioner, on oath of the president and secretary or corresponding officers of such society, a list of such applicants, giving their names, addresses, date of examination, date of approval, date of initiation, name and number of the subordinate branch of which each applicant is a member, amount of benefits to be granted, and rate of regular payments or assessments, which for societies offering death benefits shall not be lower for death benefits than those required by the National Fraternal Congress Table of Mortality as adopted by the National Fraternal Congress on August 23, 1899, or any higher standard at the option of the society, with an interest assumption not higher than 4 per cent per annum; and
(6) it shall be shown to the commissioner, by the sworn statement of the treasurer or corresponding officer of such society, that at least 500 applicants for death benefits have each paid in cash one regular payment or assessment as provided in this section, and the payments in the aggregate shall amount to at least $25,000, all of which shall be credited to the mortuary or disability or hospitalization and medical service fund on account of the applicants, and no part of which may be used for expenses.
(c) Such advance payments shall, during the period of organization, be held in trust for the applicants, and if the organization is not completed within one year as provided in this chapter, shall be returned to them.
(d) The commissioner may make such examination and require such further information, as the commissioner deems advisable, and upon presentation of satisfactory evidence that the society has complied with all the provisions of this chapter, the commissioner shall issue to the society a certificate to that effect.

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