What is the primary function of a fraternal benefit society?

What is the primary function of a fraternal benefit society?

• A. To provide investment opportunities
• B. To provide life insurance benefits to its members
• C. To donate to charity
• D. To offer financial planning services

Answer: (B)

The primary function of a fraternal benefit society is to provide life insurance benefits to its members. These societies are unique organizations that combine a social and professional aspect, often formed around a common bond such as religion, ethnicity, or profession. They offer various insurance products, including life insurance, primarily to support their members and provide benefits upon death or in times of economic hardship. Fraternal benefit societies operate on the principle of mutual aid, meaning that members contribute to a fund from which benefits can be paid to those in need. This arrangement creates a sense of community and support among members while also fulfilling the essential function of providing financial security through life insurance. While some fraternal benefit societies may engage in charitable donations or offer financial planning services as secondary activities, their central purpose revolves around delivering life insurance benefits and other related services to their members. Thus, option B aptly captures this primary objective.

The primary function of a fraternal benefit society is to provide life insurance benefits to its members. These societies are unique organizations that combine a social and professional aspect, often formed around a common bond such as religion, ethnicity, or profession. They offer various insurance products, including life insurance, primarily to support their members and provide benefits upon death or in times of economic hardship.

Fraternal benefit societies operate on the principle of mutual aid, meaning that members contribute to a fund from which benefits can be paid to those in need. This arrangement creates a sense of community and support among members while also fulfilling the essential function of providing financial security through life insurance.

While some fraternal benefit societies may engage in charitable donations or offer financial planning services as secondary activities, their central purpose revolves around delivering life insurance benefits and other related services to their members. Thus, option B aptly captures this primary objective.