Fraternal Benefit Societies: Member-owned organizations offering life insurance and exclusive benefits

Fraternal Benefit Society Characteristics Excepted

Many modern trade unions and philanthropic organizations can trace their origins back to fraternal benefit societies. These social organizations provide families with life insurance and other member-exclusive benefits.

Any domestic fraternal benefit society may be converted and licensed as a mutual life insurance company by complying with the provisions of this chapter with respect to similar mutual legal reserve life insurance corporations.


Fraternal benefit societies are member-owned, not-for-profit organizations that offer life insurance as a primary service. They are known for putting their members’ needs first and providing superior products. They are also a vital part of the community through their volunteer efforts and charitable programs.

Like mutual insurance companies, they don’t have shareholders; any profits that are not needed for operating expenses or maintaining reserves are put back into communities or towards member-exclusive benefits. They are distinguished from traditional insurance companies because they don’t exist for profit.

A fraternal benefit society, fraternal order or friendly society is a not-for-profit organization that unites individuals with common bonds such as geography, ethnicity, religion, profession and gender to share social, educational and financial opportunities. These groups are often regulated by state laws. They may be formally organized with charters and established customs or can arise ad hoc. They may offer a wide range of services including insurance, investment and community initiatives.


Unlike traditional insurance companies, which are often publicly owned and operate to generate profit for shareholders, fraternal life insurance is member-owned. This means the members come first, not the profits. The societies are operated by a system of local chapters, lodges or branches that govern themselves and coordinate social programs for members and the community.

Many of these organizations are founded based on common ethnic, religious, or occupational affiliations, and most offer a range of membership benefits. These may include fraternal insurance, health benefits, family support, community development projects, and volunteer opportunities.

Because of their nonprofit status, fraternal life insurance companies are able to return any profits not needed for operations, claims, and maintaining reserves to the members in the form of exclusive benefits or charitable contributions. BetterLife, for example, donated over $361,001 in 2022 alone. This is one of the primary reasons many people prefer to buy fraternal life insurance, compared to traditional insurers.


Fraternal organizations are able to offer a unique blend of membership, insurance and volunteerism. Unlike traditional life insurance companies, they are not-for-profit and are able to put their members’ needs first. BetterLife offers a variety of member benefits including health and wellness programs, scholarship opportunities, family benefits, disaster relief funds, lifeline screenings and community service projects.

Sec. 38a-609. (Formerly Sec. 38-221) Each society, at least once each year, shall publish a synopsis of the annual statement and an explanation of the facts thereby disclosed in such official publication. A copy of such report or statement shall be mailed to each benefit member of the society.

A domestic fraternal benefit society and a foreign fraternal benefit society licensed to do business in this state shall, not later than June first, each year, file with the commissioner a report of valuation and pay the fee provided for in section 38a-11. Such report of valuation shall show, as reserve liabilities, the difference between the present midyear value of the promises of benefits on certificates in force and the present midyear value of future net premiums as they are in practice actually collected, not including therein any value for the right to make extra assessments.


A traditional insurance company is a stock or mutual corporation that exists to generate profit for its shareholders. In contrast, a fraternal insurance company like BetterLife is member-owned and not for profit. Fraternal companies put their members first, and they also offer superior life insurance products.

Fraternal organizations are a unique blend of membership, insurance, and volunteerism. They often provide life insurance, disability coverage, and investment products and carry out charitable and community programs that support the well-being of their communities. They are typically tax-exempt under Chapter 501(c) of the Internal Revenue Code.

Fraternal societies are organized into a system of local chapters, lodges, or branches that govern themselves through democratic means. Members of the society who are not officers or directors vote in the society’s corporate and insurance affairs in a supreme council, board of directors, or intermediate assembly. They are governed by rules that reflect their common bonds and purposes. This includes a shared ethnic, religious, or vocational affiliation.

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