State RegulationsNC specificDifficulty 1/5
Which description matches a fraternal benefit society operating under North Carolina's fraternal benefit society law?
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Under Article 24 (G.S. 58-24-1 and following), a fraternal benefit society is a mutual, nonprofit organization that operates on a lodge system with representative government, has no capital stock, and provides benefits to its members and their beneficiaries. Because of that structure, many provisions of Chapter 58 that apply to commercial insurers apply differently to fraternals.
Why the other options are wrong
- B) A fraternal benefit society is expressly a no-capital-stock, nonprofit mutual body; it is not organized to pay profits to shareholders.
- C) A fraternal society is a private mutual organization operating on a lodge system; it is not a government agency administering public benefits.
- D) Membership comes through the lodge rather than through selling policies to the general public, which is how commercial insurers operate.
Memory hook
Fraternal = lodge, no stock, benefits for our own members.