What are 'fraternals' in the insurance industry?

Fraternals in the insurance industry refer to member-owned organizations that provide insurance and other benefits to their members. These organizations typically operate on a not-for-profit basis and are often formed around a common bond, such as a shared religion, culture, or social purpose. Members of these fraternals typically pay dues or premiums to access insurance coverage and may benefit from additional services such as community support, social events, and charitable activities.

Fraternals are distinctive in that they foster a strong sense of community among their members and often have a mutual aid aspect, differentiating them from traditional for-profit insurance companies that primarily aim to generate profits for shareholders. This mutual heritage focuses on supporting the needs of members rather than shareholder returns, providing a more personal approach to insurance services.