614.19(3)(b)
(b) Except as provided in s.
614.24 (1m), every fraternal shall contain in its laws and in each certificate of insurance it issues, a provision, to which every certificate of insurance issued by the fraternal shall be subject, that if the financial position of the fraternal becomes impaired, the board of directors or the supreme governing body may, on an equitable basis, apportion the deficiency among the members of the fraternal, the insured employees or the owners, or any combination thereof. A member, insured employee or owner may then either pay the member's, insured employee's or owner's share of the deficiency, or accept the imposition of a lien on the certificate of insurance, to bear interest at the rate charged on policy loans under the certificate, compounded annually until paid, or may accept a proportionate reduction in benefits under the certificate. The fraternal may specify the manner of the election and which alternative is to be presumed if no election is made.
614.19(4)
(4)
Reduction of minimum surplus. The commissioner may, by order, reduce the minimum amounts of surplus required under subs.
(1) and
(2) if in the commissioner's opinion the extent and nature of providers' contracts, financial guarantees and other support by financially sound private or public corporations, a pressing social need in a particular community for the formation of a fraternal to provide needed insurance coverage, or other special circumstances, justify the proposed reduction in the required surplus. A person who will directly compete with the proposed fraternal is aggrieved within the meaning of s.
601.62 (3) (a).
614.19(5)
(5)
Health maintenance organization insurer. This section does not apply to a health maintenance organization insurer that is subject to s.
609.96.
614.20
614.20
Certificate of authority. Section
611.20 applies to fraternals, except that references to other sections in ch.
611 shall be read to refer to the corresponding sections in this chapter.
614.20 History
History: 1975 c. 373;
1981 c. 390 s.
252.
614.22
614.22
Accelerated organization procedure. Section
611.22 applies to fraternals, except that the word “mutual" shall be read “fraternal".
614.22 History
History: 1975 c. 373.
614.24
614.24
Segregated accounts, variable benefits and subsidiaries. 614.24(1m)(a)(a)
Exemption to obtain federal approval. The commissioner shall issue a waiver exempting a policy, certificate of insurance or contract issued by a fraternal from ss.
614.19 (3) and
632.93 (2), as provided in par.
(b), if all of the following conditions are satisfied:
614.24(1m)(a)1.
1. The policy, certificate of insurance or contract provides life insurance or annuity benefits in variable amounts.
614.24(1m)(a)2.
2. The fraternal submits to the commissioner written evidence that the federal securities and exchange commission will not approve the policy, certificate of insurance or contract unless it is exempt from all or part of the requirements of ss.
614.19 (3) and
632.93 (2).
614.24(1m)(b)
(b)
Extent of exemption. A waiver issued under par.
(a) shall exempt a policy, certificate of insurance or contract from ss.
614.19 (3) and
632.93 (2) only to the extent necessary to obtain the federal security exchange commission's approval of the policy, certificate of insurance or contract.
614.24(2)(a)(a)
Local lodges. A local lodge may incorporate under ch.
181 or the corresponding law of the state where it is located, to carry out the noninsurance activities of the local lodge.
614.24(2)(b)
(b)
Institutions for carrying out fraternal activities. Corporations may be formed under ch.
181 to implement s.
614.82 (2).
614.24 History
History: 1975 c. 373;
1987 a. 361.
614.28
614.28
Changes in business plan. Section
611.28 applies to fraternals.
614.28 History
History: 1975 c. 373.
614.29
614.29
Amendment of articles of incorporation. 614.29(1)(1)
Right to amend articles. The articles of a fraternal may provide for amendment by the supreme governing body or by the board of directors, and may provide also for amendment by the members by referendum. If amendment is by referendum, a majority of those members who vote must vote affirmatively. Votes cast within 60 days from the date of mailing of the ballots by the fraternal shall be counted. The timeliness of a vote is determined by the date of its mailing as proved by its postmark or other suitable evidence.
614.29(2)
(2)
Filing. For 5 years after the initial issuance of a certificate of authority, proposed amendments of the articles which are not changes in the business plan shall be filed with the commissioner at least 30 days before the amendment is submitted for approval to the members or to the supreme governing body, or if neither is required, at least 30 days before its effective date.
614.29(3)
(3)
Filing of articles of amendment. No amendment is effective until the articles of amendment are filed with the commissioner, together with a statement of the results of the voting on the amendment.
614.29(4)
(4)
Publication to members. Within 4 months after the filing of the articles of amendment with the commissioner, they shall be furnished to all members either by mail or under s.
614.41 (1).
SECURITIES OF FRATERNALS
614.31
614.31
Securities regulation. Section
611.31 applies to fraternal bonds but does not apply to contribution notes, as they are defined in s.
611.33 as incorporated by s.
614.33.
614.31 History
History: 1975 c. 373.
614.33
614.33
Authorized securities. Section
611.33 (2) applies to fraternals, except that the words “mutual" and “nonassessable mutual" shall be read “fraternal".
614.33 History
History: 1975 c. 373.
MANAGEMENT OF FRATERNALS
614.41
614.41
Communications to members. 614.41(1)(1)
Official publications. A fraternal may provide in its laws for an official publication in which any notice, report, or statement required by law to be given to members, including notice of election, may be published. It shall be printed conspicuously in the publication.
614.41(2)
(2)
Copies to commissioner. The commissioner may by rule prescribe that copies of specified classes of communications published generally to members, including the official publication, shall be communicated to the commissioner at the same time they are sent to the members.
614.41(3)
(3)
Duplicate publications. If the records of a fraternal show that 2 or more members have the same mailing address, an official publication mailed to one member is deemed to be mailed to all members at the same address unless a member requests a separate copy.
614.41 History
History: 1975 c. 373,
421.
614.42
614.42
Representative form of government. 614.42(1)(1)
Supreme governing body. The fraternal shall have a supreme governing body consisting either of:
614.42(1)(a)
(a)
Board of directors. A board with some directors elected directly by the members or by their representatives in intermediate assemblies under sub.
(2), and other directors prescribed in the fraternal's laws. The elected directors shall constitute a majority in number and not less than the number of votes required to amend those articles or bylaws of the fraternal that can be amended without consent of the members. The board shall meet at least quarterly to conduct the business of the fraternal. The elected directors shall be elected on a plan that ensures equal weight to each fraternal member's vote. Voting may be conducted by mail, by electronic means, or by any other method or combination of methods approved by the board and prescribed in the fraternal's bylaws.
614.42(1)(b)
(b)
Assembly. Delegates elected directly by the members or at intermediate assemblies or conventions of members or their representatives, together with other delegates prescribed in the fraternal's laws. The elected delegates shall constitute a majority in number and shall not have less than two-thirds of the votes and not less than the number of votes required to amend the articles or bylaws that can be amended without consent of the members. The assembly, whatever designated, shall meet at least once every 4 years and shall elect a board of directors to conduct the business of the fraternal between meetings of the assembly. The delegates making up the supreme governing body shall be elected on a plan that ensures equal weight to each fraternal member's vote.
614.42(2)
(2)
Intermediate assemblies. The laws of a fraternal may provide that delegates to intermediate assemblies may represent geographical districts or lodges or represent the members in defined classes determined on a reasonable basis and that the vote of a representative to an intermediate assembly shall be treated as the vote of the members represented.
614.42(3)
(3)
Voting procedure. No votes may be cast by proxy.
614.42 History
History: 1975 c. 373,
421;
2009 a. 342.
614.43
614.43
Annual report to fraternal members. Every domestic fraternal shall send to each member having insurance or publish in the official publication under s.
614.41 (1) an annual report which shall contain basic financial and operating data, information about important business and corporate developments and such other information as the fraternal wishes to include or as the commissioner by rule requires it to include in order to keep members adequately informed.
614.43 History
History: 1975 c. 373;
1979 c. 102.
614.51
614.51
Board of directors. 614.51(1)(1)
General. Sections
181.0801 (1) and
(2) and
181.0802 apply to fraternals, except that the supreme governing body may act as the board of directors if it meets at least quarterly. Section
611.51 (2) to
(9) applies to fraternals, except that the word “mutual" shall be read “fraternal" and the references to other sections of ch.
611 shall be to the corresponding sections of this chapter.
614.51(2)
(2)
Terms of directors and officers. The terms of directors and officers may not exceed 4 years.
614.51 History
History: 1975 c. 373;
1997 a. 79.
614.53
614.53
Removal of directors and officers and filling of vacancies. A director may be removed from office for cause by an affirmative vote of a majority of the full board at a meeting of the board called for that purpose or may be removed under ss.
181.0843 (2) and
181.0844. Any vacancy occurring in the board, including a vacancy created by an increase in the number of directors, may be filled until the next succeeding regular election by the affirmative vote of a majority of the directors then in office, although less than a quorum. If the laws of the fraternal provide that at least two-thirds of the directors are elected by the members, elected director vacancies may be filled for the remainder of the terms for which there is a vacancy. If the vacancy is one to be filled in some manner other than by a regular election, the election by the board is effective only until a reasonable time has elapsed for choosing the director in that other manner. In the event that the board of directors ceases to exist and there are no members having voting rights, the members without voting rights shall thereupon have power to elect a new board. A director elected under this section to fill the unexpired term of an elected director is an elected director within the meaning of s.
614.42 (1) (a).
614.54
614.54
Supervision of management changes. Section
611.54 applies to fraternals.
614.54 History
History: 1975 c. 373.
614.55
614.55
Continuity of management in emergencies. Section
611.55 applies to fraternals.
614.55 History
History: 1975 c. 373.
614.56
614.56
Committees of directors. Section
611.56 applies to fraternals, except that reference therein to other sections of ch.
611 shall be to the corresponding sections of this chapter.
614.56 History
History: 1975 c. 373.
614.57
614.57
Interlocking directorates and other relationships. Section
611.57 applies to fraternals.
614.57 History
History: 1975 c. 373.
614.60
614.60
Transactions with affiliates and in which directors and others are interested. Sections
611.60 and
611.61 apply to fraternals except that local lodges are not required to keep detailed records under s.
611.61 (1) (b) if the fraternal does so.
614.60 History
History: 1975 c. 373;
1979 c. 102.
614.62
614.62
Directors' liability and indemnification. Section
611.62 applies to fraternals, except that the word “mutual" shall be read “fraternal".
614.62 History
History: 1975 c. 373.
614.63
614.63
Executive compensation. Section
611.63 applies to fraternals, except that the word “mutual" shall be read “fraternal".
614.63 History
History: 1975 c. 373.
614.66
614.66
Exclusive agency contracts and management contracts. Sections
611.66 and
611.67 apply to fraternals, except that the reference to s.
611.26 (1) contained in s.
611.66 is to that section as incorporated by s.
614.24.
614.66 History
History: 1975 c. 373;
1997 a. 252.
CORPORATE REORGANIZATION
614.73
614.73
Merger and consolidation of fraternals. 614.73(1)(1)
Authorization, domestic fraternals. Any 2 or more domestic fraternals may merge or consolidate under the provisions of subs.
(3) and
(4).
614.73(2)
(2)
Authorization, domestic and nondomestic fraternals. Any 2 or more domestic and nondomestic fraternals may merge or consolidate under the provisions of sub.
(5).
614.73(3)
(3)
Procedure for domestic fraternals. The supreme governing body of each domestic fraternal proposing to merge or consolidate shall:
614.73(3)(a)
(a) At least 60 days prior to the proposed action submit the text of the proposed contract to its members in the manner provided by s.
614.29 (4);
614.73(3)(b)
(b) Approve the proposed consolidation or merger by a two-thirds vote; and
614.73(3)(c)
(c) File with the commissioner a certified copy of the written contract containing in full the terms and conditions of the consolidation or merger, a sworn statement by the president and secretary or corresponding officers of each fraternal showing the financial condition of each on a date to be fixed by the commissioner but no earlier than the December 31 of the year preceding the proposed contract, and evidence of compliance with pars.
(a) and
(b).
614.73(4)
(4)
Issuance of certificate by commissioner. The commissioner shall issue a certificate approving the merger or consolidation, upon a finding that:
614.73(4)(a)
(a) The contract conforms to the provisions of this chapter;
614.73(4)(b)
(b) The parties to the proposed contract have complied with the provisions of sub.
(3); and
614.73(4)(c)
(c) The proposed contract is just and equitable to the members of each fraternal.
614.73(5)
(5)
Procedure for nondomestic fraternals. Where a nondomestic fraternal is a party to the proposed contract, the parties shall follow the procedure for domestic fraternals under subs.
(3) and
(4), but the commissioner may not issue a certificate of compliance until the parties file a certificate that the proposed contract has been approved in the manner provided by the laws of the jurisdiction under which the fraternal is incorporated, or, if such laws contain no procedure for approval, that the proposed contract has been approved by the commissioner of insurance for that jurisdiction.
614.73(6)
(6)
Effective date. The merger or consolidation is effective when the commissioner issues a certificate of approval.
614.73(7)
(7)
Effect of consolidation or merger. When the merger or consolidation is effective, the surviving or new fraternal shall have all the assets and be liable for all of the obligations of each of the participating fraternals.
614.73 History
History: 1975 c. 373,
421;
1979 c. 102.
614.74
614.74
Voluntary dissolution of solvent domestic fraternals.
