New York Laws
Article 45 - Fraternal Benefit Societies
4515 - Conditions for Avoiding Separate Funds.

(b) (1) Such minimum standards of valuation shall be:
(A) as to all contracts for life insurance benefits issued prior to
January first, nineteen hundred forty-eight, the American Experience
Table of Mortality or the American Men Ultimate Table of Mortality with
interest at three and one-half per centum,
(B) as to all contracts for life insurance benefits issued on and
after January first, nineteen hundred forty-eight, and prior to January
first, nineteen hundred fifty-six, the American Experience Table of
Mortality or the American Men Ultimate Table of Mortality with interest
at three per centum, and
(C) as to all contracts for life insurance benefits issued on and
after January first, nineteen hundred fifty-six, the applicable
mortality tables as specified in subsection (c) of section four thousand
five hundred seventeen of this article.
(2) The deficient premium reserve as to all such contracts issued
prior to January first, nineteen hundred forty-eight, shall be
determined in the manner prescribed in subsection (b) of section four
thousand five hundred seventeen of this article and as to all such
contracts issued on and after January first, nineteen hundred
forty-eight, shall be determined in the manner prescribed in section
four thousand two hundred eighteen of this chapter.
(3) Such minimum standard of valuation as to all contracts for annuity
benefits issued on and after January first, nineteen hundred
forty-eight, shall be the 1937 Standard Annuity Mortality Table with
interest at three per centum.
(c) No such society shall, except as provided for in subsection (f)
hereof, make or incur in any calendar year, or permit to be made or
incurred on its behalf or under any agreement with it, total life
insurance expenses as defined in subsection (d) hereof in excess of the
total life insurance expense limit as defined in subsection (e) hereof.
(d) The total life insurance expenses of any such society within the
meaning of this section, shall include all expenses, made or incurred on
its behalf with its permission or under any agreement with it, in the
business of fraternal life insurance, except:
(1) taxes, licenses and fees,
(2) disbursements for altruistic, educational, fraternal or
recreational activities which are made from funds collected solely for
such purposes and in addition thereto disbursements for like purposes in
an amount not exceeding one and one-half per centum of the premiums
received for life insurance contracts during such calendar year,
(3) that portion of its total investment expenses not exceeding
one-fourth of one per centum of the mean amount of its total invested
assets during such calendar year,
(4) taxes and other outlays exclusively in connection with real estate
and commissions, or salaries and expenses in lieu of commissions, on
mortgage loans, and
(5) outlays representing the accrued liability for services rendered
by the society's employees prior to coverage under employees pension
plans.
(e) The total life insurance expense limit, within the meaning of this
section, shall be the sum of the following items:
(1) seven per centum of all life insurance premiums received by such
society during such calendar year,
(2) thirty-five per centum of all first year life insurance premiums
received by such society during such calendar year,
(3) one hundred seventy-five one thousandths of one per centum of the
aggregate amount of life insurance of such society in force at the
beginning of such calendar year and of the aggregate amount of such
insurance issued during, and in force at the end of, such calendar year,
(4) three-tenths of one per centum of the aggregate amount of life
insurance of such society in force at the beginning of such calendar
year and of the aggregate amount of such insurance issued during, and in
force at the end of, such calendar year, and
(5) thirty-five one hundredths of one per centum of the aggregate
amount of life insurance of such society issued during, and is in force
at the end of, such calendar year, exclusive of additional insurance
purchased by the application of certificate dividends.
(f) The total life insurance expense limit of any such society which
has in force at the end of the next preceding calendar year less than
one million dollars of life insurance shall be increased by one hundred
per centum; and for any other such society, such limits shall be
increased by one hundred per centum less two-tenths of one per centum
for each one million dollars of life insurance in excess of one million
dollars of life insurance until the extra margin is sixty per centum of
said limit, and thereafter said extra margin shall decrease by one-third
of one per centum for each ten million dollars of life insurance in
force at the end of the next preceding calendar year until the extra
margin is fifty per centum; and thereafter said extra margin shall
decrease by one-half of one per centum for each ten million dollars of
life insurance in force at the end of the next preceding calendar year
until such extra margin is reduced to zero.
(g) The amounts of life insurance referred to in this section shall
not include additional benefits payable for accidental death or for
total and permanent disability.
(h) No such society, and no person, firm or corporation, on its behalf
or under any agreement with it, shall pay or allow to any agent, broker,
employee or other person, for services in procuring an application for
life insurance, for collecting any premium thereon or for any other
service performed in connection therewith, any compensation greater than
that which has been determined by agreement made in advance of the
rendering of such service.
(i) The superintendent may, in his discretion, accept satisfactory
approximations of the figures required in this section. If any such
society shall in any calendar year make or incur total life insurance
expenses in excess of the total life insurance expense limit, the
superintendent may, upon written application of such society, suspend
such limit for such society for the calendar year in which such excess
was incurred.
(j) Notice of intention to comply with the provisions of this section
shall be given in writing to the superintendent by any such society,
accompanied by a certified copy of the authorizing resolution of the
board of directors.