Chap. 411.-—-An ACT to provide that persons, firms, corporations or associations
which collect dues or assessments and provide burial benefits in return therefor
shall be known as burial societies; to provide for the organization, licensing
and regulation of such societies; and to provide penalties. [S B 173]

Approved March 30, 1936

1. Be it enacted by the General Assembly of Virginia, as follows:

Section 1. Any person, firm, corporation, society, or association of
individuals engaged in the business of providing burial benefits for the
payment in whole or in part of funeral, burial and expenses of de-
ceased persons, certificate holders or subscribers, by levying assess-
ments, dues or premiums, collected or to be collected from the mem-
bers thereof, or the members of a class therein, shall be governed by
the provisions of this act and be defined as a burial society.

Section 2. Such burial society may be incorporated under the
provisions of chapter one hundred and fifty-one of the Code of Vir-
ginia and whether incorporated or not shall be governed by the pro-
visions of chapter one hundred and seventy of the Code of Virginia
except as specifically provided in this act.

Section 3. Burial societies as herein defined, whether incorporated
or not, shall be subject to the supervision and control of the State
Corporation Commission and shall secure from the commission an-
nually a license to operate under the provisions of this act which
license shall expire on the thirtieth day of April. No burial society
shall operate or solicit or secure members in this State unless it shall
have obtained and holds such license as herein required, but no license
shall be issued to a burial society, organized or incorporated, under the
laws of another State or country, nor may any foreign or alien society
operate in this State.

Section 4. Before any burial society shall be licensed to transact
business in this State, it shall first comply with the provisions of sec-
tion forty-two hundred and eleven of the Code of Virginia as amended,
relating to the deposit of securities with the Treasurer of the Common-
wealth, provided, however, that if the society limits the amount of its
benefits to any one member to an amount not in excess of three hun-
dred dollars, the amount of such deposit shall be twenty-five hundred
dollars.

Section 5. Such burial societies, which limit the benefits payable
to any one member to an amount not in excess of three hundred dol-
lars, in lieu of the emergency fund provided for in section forty-two
hundred and sixty of the Code of Virginia as amended, shall on De-
cember thirty-first, nineteen hundred and thirty-six, and annually
thereafter, set aside as a reserve for the protection of all its certificate
holders at the time of their death, an amount not less than five per
centum of the gross collections from all members during the past
twelve months, inclusive of December, provided, however, that such
reserve shall not accumulate to more than five per centum of the total
benefits provided for in the certificates issued and outstanding, and
any amount in excess of such five per centum shall be used to settle
claims subsequently maturing and no assessment may be made on its
P= ee Ee EE EE Ee ae =

certificate holders while such an excess exists, unexpended in the dis-
charge of such claims.

Section 6. All burial societies, whether incorporated or not, shall
issue certificates of membership to each member thereof, but no such
certificate shall be issued or delivered in this State unless and until a
copy of the form thereof shall have been filed with the State Corpora-
tion Commission and formally approved by it. Each such certificate
shall state the amount of the benefit which is payable under its pro-
visions and the name of the beneficiary.

Section 7. Such beneficiaries shall be confined to wife, husband,
relative by blood to the fourth degree, father-in-law, mother-in-law,
son-in-law, daughter-in-law, stepfather, stepmother, stepchildren, chil-
dren by legal adoption, or to a person or persons dependent upon the
member. Within the above restrictions, each member shall have the
right to designate his beneficiary, and, from time to time change such
beneficiary if within such restriction, upon due notice to the society,
and no beneficiary shall have or obtain any vested interest in the said
benefit until the same has become due and payable upon the death of
the said member. No certificate of membership in any such burial
society, nor any interest therein or rights thereunder, shall be assigned
unless such assignment is to a person or persons authorized by this
section to be named as a beneficiary. No money or other benefit pro-
vided by any such society shall be liable to attachment, garnishment or
other process, or be seized, taken, appropriated or applied by any
legal or equitable process or operation of law to pay any debt or lia-
bility of a member or beneficiary, or any other person who may have a
right thereunder, either before or after payment.

Section 8. No certificate of membership in a burial society as
herein defined shall be issued, received, or held to be valid where those
concerned in its procurement shall have reason to believe that the
holder thereof is ill at the time of procurement, and where any such
illness shall extend to, and be the cause or contributing cause of, the
death of such member, which shall occur within sixty days from the
date of such issue.

Section 9. No burial society shall contract or promise to make
payment or settlement of any claim otherwise than in money.

Section 10. No burial society, whether incorporated or not, which
is engaged in the business of providing for the payment of the funeral,
burial or other expenses of the deceased member or certificate holders
therein, shall contract to pay or pay such benefits or any part of such
to any official undertaker or to any designated undertaker or undertak-
ing concern or to any particular tradesman or business man engaged
in the funeral business so as to deprive the representative or family of
the deceased from, or in any way control them in, procuring and pur-
chasing such supplies and services in the open market with the advan-
tage of competition.

Section 11. The president, treasurer, secretary or other officer of
such society whether incorporated or not, who shall be charged with
the duty of handling its funds, shall furnish a surety bond with cor-
porate security approved by the State Corporation Commission, in an
amount of not less than twenty-five hundred nor more than ten thou-
sand dollars to be fixed by the said commission, securing to such so-
ciety and its members the faithful performance of his duties and a
proper accounting of the said funds.

Section 12. No officer, agent or employee of any such society shall
have a proprietary or financial interest in, or be employed by or act as
agent for any person, firm, corporation or association engaged in the
business of embalming or of burying the dead.

Section 13. Any person, firm, association, society, or corporation
which transacts, or attempts to transact, the business of a burial society
as herein defined without first procuring a license as herein provided,
or violates any of the provisions of this act, shall be guilty of a mis-
demeanor and upon conviction thereof shall be fined not less than one
hundred dollars, nor more than one thousand dollars.

Section 14. Any burial society which shall fail to comply with the
provisions of this act shall be amenable to the provisions of sections
forty-two hundred and forty-two, forty-two hundred and forty-three,
forty-two hundred and forty-four, forty-two hundred and forty-five,
and forty-two hundred and forty-six of the Code of Virginia.

Section 15. The provisions of this act shall not apply to fraternal
benefit societies, industrial life insurance companies, nor to industrial
sick benefit companies.

2. All acts and parts of acts inconsistent with the provisions of this
act are hereby repealed to the extent of such inconsistency.

3. If any section, clause, or provision of this act shall be uncon-
stitutional, or be ineffective in whole or in part, to the extent that it
is not unconstitutional or ineffective, it shall be valid and effective, and
no other section, clause or provision shall on account thereof be deemed
invalid or ineffective, and the inapplicability or invalidity of any sec-
tion, clause or provision of this act in any one or more instances shall
not be taken to affect or prejudice in any way its applicability or
validity in any other instance.