Pennsylvania Bill Could Affect Struggling Fraternals
July 30, 2019 by Maria Wood
The Pennsylvania House of Representatives recently agreed unanimously to approve a bill to streamline takeovers of failing nonprofit fraternal benefit societies. These membership groups offer their participants a limited menu of life insurance and retirement products like annuities.
Pennsylvania oversees about a dozen fraternal benefit organizations with about 493,000 members — the highest total for any state. Members in a fraternal organization share a common faith or occupation. They typically have a network of local chapters, and they often emphasize doing charity work in the community.
In a memo detailing House Bill 1016, the bill’s sponsors emphasized that currently operating fraternal organizations are fiscally sound. However, an increasingly competitive insurance marketplace may put these organizations at risk in the future, the sponsors said.
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