2007 Oregon Code - Chapter 744 :: Chapter 744 - Insurance Producers - Life Settlement Providers - Brokers and Contracts - Adjusters - Consultants - Third Party Administrators - Reinsurance Intermediaries - Rental Company Limited Licenses
Chapter 744 —
Insurance Producers; Life Settlement Providers,
Brokers and
Contracts; Adjusters; Consultants; Third Party Administrators;
Reinsurance
Intermediaries; Rental Company Limited Licenses
2007 EDITION
LICENSEES AND ADMINISTRATORS
INSURANCE
GENERAL PROVISIONS
744.001Â Â Â Â License
application; fees
744.002Â Â Â Â License
categories
744.003Â Â Â Â Amendment
to license
744.004Â Â Â Â Firm
or corporation license
744.007Â Â Â Â Time
of expiration of license; renewal fee; rules
744.008Â Â Â Â Renewal
of license; fee; rules
744.009Â Â Â Â Renewal
of expired license; fee
744.011Â Â Â Â DirectorÂ’s
authority to investigate licensee; qualification for license by person who
voluntarily surrendered license
744.013Â Â Â Â Disciplinary
actions against applicant, adjuster or insurance consultant
744.014Â Â Â Â Condition
of probation on license or on category or class of insurance; disciplinary
action during probationary period
744.018Â Â Â Â Reinstatement
of license; modification of suspension
744.022Â Â Â Â Authorized
activities
744.024Â Â Â Â Places
of business for resident adjuster or insurance consultant; records
744.026Â Â Â Â Place
of business for nonresident adjuster or insurance consultant; records
744.028Â Â Â Â Notice
of change of address or telephone number
744.031Â Â Â Â Notice
of personnel changes from firm or corporate adjuster or insurance consultant to
director; rules
744.033Â Â Â Â Manner
of application or notification
744.037Â Â Â Â Fees;
refunds; rules
INSURANCE PRODUCERS
744.052Â Â Â Â Definitions
744.053Â Â Â Â Requirements
to be licensed as insurance producer for class of insurance
744.056Â Â Â Â Exemptions
from insurance producer licensing requirements
744.058Â Â Â Â Written
examination; fees; rules
744.059Â Â Â Â Qualifications
for license; use of uniform application
744.061Â Â Â Â Banking
institution as insurance producer
744.062Â Â Â Â Issuance
of insurance producer license; rules
744.063Â Â Â Â Nonresident
insurance producer license; fee
744.064Â Â Â Â Persons
licensed elsewhere
744.067Â Â Â Â Exemptions
from prelicensing education or examination requirement
744.068Â Â Â Â Required
notifications; maintenance of usual and customary records; rules
744.072Â Â Â Â Renewal
or reinstatement of insurance producer license; continuing education; rules
744.073Â Â Â Â Temporary
insurance producer license
744.074Â Â Â Â Authority
of director to place licensee on probation or to suspend, revoke or refuse to
issue or renew license
744.076Â Â Â Â Payment
of commission, service fee or brokerage
744.077Â Â Â Â Conditions
under which person licensed as insurance producer and consultant may accept
commission or fee; rules
744.078Â Â Â Â Appointment
of insurance producers; rules
744.079Â Â Â Â Termination
of relationship with insurance producer
744.081Â Â Â Â Termination
of appointment
744.082Â Â Â Â Waiver
of requirement for nonresident insurance producer license applicant
744.083Â Â Â Â Trust
account for premium funds; commingling; exceptions; rules
744.084Â Â Â Â Certificate
of deposit in lieu of trust account; rules
744.086Â Â Â Â Applicability
of Insurance Code to insurance producers transacting title insurance
744.087Â Â Â Â Filing
insurance producers compensation agreements; filing not public record
744.088Â Â Â Â Training
requirements to be licensed as insurance producer for long term care insurance
744.089Â Â Â Â Report
of administrative action taken against insurance producer
744.091Â Â Â Â Additional
conditions under which person licensed as insurer or insurance producer may
charge commission or service fee; rules
744.093Â Â Â Â Solicitation
or sale of insurance policy by retail insurance producer or wholesale insurance
producer; rules
MANAGING GENERAL AGENTS
744.300Â Â Â Â License
and indorsement; managing general agent described
744.301Â Â Â Â Exemptions
from license requirement
744.303Â Â Â Â Certificate
of errors and omissions insurance; rules
744.306Â Â Â Â Contract
between insurer and managing general agent
744.308Â Â Â Â Limitations
on authority of insurer and managing general agent
744.311Â Â Â Â Books,
bank accounts and records
744.313Â Â Â Â Financial
examination; loss reserves; notification of appointment and termination; acts
of managing general agent attributed to insurer
744.314Â Â Â Â Rules
744.316Â Â Â Â Authority
of director if managing general agent violates provisions of ORS 744.300 to
744.316
LIFE SETTLEMENT CONTRACTS
744.319Â Â Â Â Definitions
744.321Â Â Â Â Life
settlement providers
744.323Â Â Â Â Life
settlement brokers
744.326Â Â Â Â License
application; fee
744.328Â Â Â Â Issuance
of license
744.331Â Â Â Â Expiration
of license; rules for renewal
744.333Â Â Â Â Individual
acting as provider under license of firm or corporation
744.336Â Â Â Â Notification
by licensee of material change affecting qualification for license
744.338Â Â Â Â Suspension,
revocation, refusal to issue or renew license
744.341Â Â Â Â Terms
of contract
744.343Â Â Â Â Annual
report by provider
744.346Â Â Â Â Examination
of business and practices of licensee or applicant; records
744.348Â Â Â Â Disclosure
of information to policyholder
744.351Â Â Â Â Conditions
precedent to entering into life settlement contract
744.353Â Â Â Â Prohibitions
on finderÂ’s fee, solicitations, discrimination
744.356Â Â Â Â Payment
to escrow or trust account; lump sum payment
744.358Â Â Â Â Rules;
standards; bond
ADJUSTERS
744.505Â Â Â Â Adjuster
license required
744.515Â Â Â Â Exemptions
from adjuster licensing requirement
744.525Â Â Â Â Adjuster
qualifications
744.528Â Â Â Â Nonresident
adjuster license
744.531Â Â Â Â Classes
of insurance for adjusters
744.535Â Â Â Â Adjuster
licensing examination
744.538Â Â Â Â Change
of circumstance of nonresident adjuster
744.541Â Â Â Â Adjustment
of claim under policy issued by unauthorized insurer
744.555Â Â Â Â Temporary
adjuster permit
744.575Â Â Â Â Adjusting
claims involving credit life or credit health insurance
INSURANCE CONSULTANTS
744.605Â Â Â Â Insurance
consultantÂ’s license required
744.609Â Â Â Â Exemptions
744.619Â Â Â Â Qualifications
for resident insurance consultantÂ’s license; rules
744.621Â Â Â Â Nonresident
insurance consultant license
744.626Â Â Â Â Classes
of insurance for consultants
744.631Â Â Â Â Change
of circumstance of nonresident insurance consultant
744.635Â Â Â Â Errors
and omissions insurance; rules
744.650Â Â Â Â Disclosure
by insurance consultants; rules
744.655Â Â Â Â Rebates
prohibited
744.665Â Â Â Â Continuing
education; rules
THIRD PARTY ADMINISTRATORS
744.700Â Â Â Â Definitions
for ORS 744.700 to 744.740
744.702Â Â Â Â Third
party administrator license; description of transacting business as third party
administrator
744.704Â Â Â Â Exemptions
from license requirement; rules
744.706Â Â Â Â Application
for license
744.708Â Â Â Â Waiver
of information requirement
744.710Â Â Â Â Issuance
or denial of license
744.712Â Â Â Â Expiration
and renewal of license; rules for renewal
744.714Â Â Â Â Registration
of persons exempt from licensure
744.716Â Â Â Â Notification
of change in ownership or control
744.718Â Â Â Â Suspension,
revocation or refusal of issuance or renewal of license
744.720Â Â Â Â Agreement
between insurer and third party administrator
744.722Â Â Â Â Relationship
of insurer and third party administrator regarding payments
744.724Â Â Â Â Books
and records
744.726Â Â Â Â Errors
and omissions insurance; rules
744.728Â Â Â Â Advertising
744.730Â Â Â Â Disposition
of charges and premiums
744.732Â Â Â Â Contingent
fee agreements
744.734Â Â Â Â Notice
to insureds regarding third party administrator
744.736Â Â Â Â Delivery
from insurer to insured
744.738Â Â Â Â Annual
report
744.740Â Â Â Â Responsibility
of insurer using third party administrator
REINSURANCE INTERMEDIARIES
744.800Â Â Â Â Qualifications
for reinsurance intermediary brokers and managers
744.802Â Â Â Â Exemptions
from application of requirements for reinsurance intermediary brokers and
managers
744.804Â Â Â Â Conditions
under which reinsurance intermediary broker and insurer may enter into
transactions
744.806Â Â Â Â Records
required to be kept by reinsurance intermediary brokers
744.808Â Â Â Â Prohibition
on use of unlicensed reinsurance intermediary broker; requirement that insurer
obtain financial statement of reinsurance intermediary broker
744.810Â Â Â Â Conditions
under which reinsurance intermediary manager and reinsurer may enter into
transactions
744.812Â Â Â Â Prohibitions
on actions of reinsurance intermediary managers
744.814Â Â Â Â Prohibition
on use of unlicensed reinsurance intermediary manager; requirement that
reinsurer obtain financial statement of reinsurance intermediary manager and
opinion of actuary
744.816Â Â Â Â Director
access to books, accounts and records
744.818Â Â Â Â Errors
and omissions insurance for reinsurance intermediary manager; rules
744.820Â Â Â Â Director
authority if reinsurance intermediary broker or manager violates provisions of
ORS 744.800 to 744.818
VEHICLE RENTAL COMPANIES
744.850Â Â Â Â Definitions
for ORS 744.850 to 744.858
744.852Â Â Â Â Limited
license for rental companies; application; rules
744.854Â Â Â Â Kinds
of insurance authorized by limited license
744.856Â Â Â Â Conditions
for issuance of insurance; training; filing officer
744.858Â Â Â Â Revocation
or suspension of limited license; other penalties; application of Insurance
Code; rules
GENERAL PROVISIONS
     744.001
License application; fees.
(1) ORS 744.001 to 744.009, 744.011, 744.013, 744.014, 744.018, 744.022 to
744.033 and 744.037 govern the licensing of adjusters and insurance
consultants.
     (2) An applicant for a license as an
adjuster or an insurance consultant shall apply for the license to the Director
of the Department of Consumer and Business Services. The applicant shall
include the following information:
     (a) The applicant’s name, business
address, residence address, present occupation, occupation for the last 12
months, the portion of time to be devoted to the insurance business, previous
insurance experience and the names of employers during the preceding five
years. The applicant shall include the business address of the principal place
of business and the business address of each additional location at which the
applicant will transact business under the license.
     (b) All assumed business names and other
names under which the applicant will engage in business under the license.
     (c) Whether the applicant has ever been
convicted of or is under indictment for a crime, whether the applicant has ever
had a judgment entered against the applicant for fraud, whether any insurer or
insurance producer claims the applicant is indebted to it and the details of
any such indebtedness, and whether any license of the applicant to act in any
occupational or professional capacity has ever been refused, revoked or
suspended in this or any other state.
     (d) The applicant’s fingerprints, if the
applicant is applying for a resident license. An applicant applying for a
nonresident license shall provide the applicantÂ’s fingerprints only if the
director so requests.
     (e) The class or classes of insurance to
be transacted under the license.
     (f) Any other information that the
director requires by rule.
     (3) If the applicant for a license under
this section is a firm or corporation, the application shall show, in addition,
the names of all members, officers and directors. If the applicant is a
corporation, the application shall state the names of all stockholders who own,
directly or indirectly, more than 10 percent of any class of any equity
security of the corporation, and shall designate each individual who is to
exercise the powers to be conferred by the license upon the firm or
corporation.
     (4) Each application shall be accompanied
by the applicable fees established by the director. [1989 c.701 §§13,81g; 2001
c.191 §26; 2003 c.364 §117; 2007 c.71 §241]
     744.002
License categories. (1) The
Director of the Department of Consumer and Business Services may issue a
license authorizing a person to act as an adjuster or an insurance consultant.
A person licensed to act in one capacity may also be licensed to act in the
other capacity if the person meets the appropriate qualifications. For purposes
of this chapter, the capacity in which a person is licensed to act constitutes
a “license category” or a “category of insurance business.”
     (2) A license issued under this section
shall set forth each license category in which the licensee may engage. For
each license category, the license shall also set forth the class or classes of
insurance in which the licensee may engage, as provided in:
     (a) ORS 744.531, for the license category
of adjuster.
     (b) ORS 744.626, for the license category
of insurance consultant.
     (3) The director may issue resident and
nonresident licenses under this section as follows:
     (a) The director may issue a resident
license to a person if the person is a resident of this state or, if not a
resident of this state, the person has a place of transacting insurance in this
state.
     (b) The director may issue a nonresident
license to a person if the person is not a resident of this state.
     (4) The director shall issue a license
under this section:
     (a) If the applicant has completed and
submitted to the director an application for the license and has submitted all
applicable fees, including any examination fees, as established by the director
with the application;
     (b) If the director determines that no
ground for denial of the license exists under ORS 744.013; and
     (c) If the director determines that the
applicant has met the applicable qualifications and requirements for each
license category, and for each class of insurance for which application is
made. [1989 c.701 §§2,81e; 1995 c.639 §3; 2001 c.191 §27]
     744.003
Amendment to license. (1)
The Director of the Department of Consumer and Business Services may add a
category of insurance business to an adjuster or insurance consultant license
upon application by the licensee for amendment of the license.
     (2) The director may add a class or
classes of insurance to a license upon application by the licensee for
amendment of the license.
     (3) The director may require that
applications under this section be made in the same manner as applications for
the initial license, or the director may establish other application
procedures. [1989 c.701 §3; 2001 c.191 §28]
     744.004
Firm or corporation license.
(1) The Director of the Department of Consumer and Business Services may issue
or amend a firm or corporation license under ORS 744.002 only if the firm or
corporation, for each category of insurance business that the firm or
corporation applies for on its license, employs an individual whose license
under ORS 744.002 authorizes the individual to engage in that category of insurance
business.
     (2) When a firm or corporation applies for
a license or applies to amend the license, the director may issue or amend the
license only if the firm or corporation, for each class of insurance that the
firm applies to transact, employs an individual whose license under ORS 744.002
authorizes the individual to transact that class of insurance. [1989 c.701 §4]
     744.005 [1967 c.359 §525; repealed by 1989 c.701 §81]
     744.007
Time of expiration of license; renewal fee; rules. (1) A license issued under ORS 744.002
expires on its expiration date unless it is renewed on or before its expiration
date.
     (2) A license expires on the last day of
the month in which the first anniversary of the initial issuance date of the
license occurs, unless the Director of the Department of Consumer and Business
Services designates another date. Thereafter, the license shall expire on the
second anniversary following each renewal.
     (3) When a category of insurance business
is added to a license, the expiration date for the license shall be the last
day of the month in which the second anniversary of the issuance date of the
amended license occurs, unless the director establishes another expiration
date.
     (4) The fee for renewal of a license shall
be the fee established by the director, which shall include the fee established
for each category of insurance business on the license.
     (5) The director by rule may establish
procedures for renewal of licenses.
     (6) A suspended license is subject to
renewal and to all requirements applicable to renewal if the license expires
during the suspension period. [1989 c.701 §§5,81f]
     744.008
Renewal of license; fee; rules.
An adjuster or insurance consultant may renew a license subject to the
following requirements:
     (1) The licensee must pay the applicable
fee established by the Director of the Department of Consumer and Business
Services.
     (2) The licensee must satisfy all
applicable continuing education requirements and all other applicable
conditions and requirements specified by statute.
     (3) If the licensee holds a nonresident
license, the licensee must submit proof to the director, with respect to each
category of insurance business and class of insurance set forth on the license,
that the licensee continues to hold a valid license or other evidence of
authority issued by the state of residence of the licensee for the same
category of insurance business.
     (4) If the licensee is an insurance
consultant, the licensee must provide satisfactory evidence that the insurance
required under ORS 744.635 is in effect.
     (5) The licensee must satisfy any other
requirements established by the director by rule. [1989 c.701 §§14,81h; 1991
c.810 §2; 2001 c.191 §29]
     744.009
Renewal of expired license; fee. (1) The Director of the Department of Consumer and Business Services
may renew an expired license of an adjuster or insurance consultant upon
application if the license expired within two years prior to the application
and if:
     (a) The license was not suspended or
revoked by the director, or not renewed, on any ground under ORS 744.013;
     (b) The director is satisfied, by
examination or otherwise, that the person is knowledgeable about the portions
of the Insurance Code applicable to the license;
     (c) The person pays double the amount of
the regular renewal fee; and
     (d) The person satisfies all requirements
for renewal.
     (2) A person who does not renew an expired
license as provided in this section may obtain a license only if the person
applies and qualifies for and is issued the license in the same manner as a
person who initially applies for the license. [1989 c.701 §6; 2001 c.191 §30]
     744.010 [Repealed by 1967 c.359 §704]
     744.011
DirectorÂ’s authority to investigate licensee; qualification for license by
person who voluntarily surrendered license. (1) The expiration of a license or the voluntary surrender of a
license by a licensee under this chapter shall not deprive the Director of the
Department of Consumer and Business Services of jurisdiction to proceed with
any investigation of, or any action or disciplinary proceedings against, the
licensee or to revise or render void an order suspending or revoking the
license.
     (2) As provided in this subsection, a
person who has voluntarily surrendered a license may qualify for a license
conferring the same authority as the surrendered license without having to take
an examination that is otherwise required. In order to qualify without
examination, the person must apply for the license within two years after the
date on which the person surrendered the prior license. The person must apply
and otherwise qualify for the license in the same manner as a person who
initially applies for the license. If the person is required to satisfy
continuing education requirements for renewal of the license, the person must
show satisfaction of continuing education requirements for each renewal date
occurring during the period following the surrender in which the person did not
hold a license. [1989 c.701 §11; 1991 c.810 §3; 2001 c.191 §42]
     744.012 [1979 c.501 §1; 1989 c.701 §41; renumbered
744.240 in 1989]
     744.013
Disciplinary actions against applicant, adjuster or insurance consultant. (1) If the Director of the Department of
Consumer and Business Services finds with respect to an adjuster or insurance
consultant or an applicant for an adjuster or insurance consultant license that
one or more of the grounds set forth in subsection (2) of this section exist,
the director may take the following disciplinary actions:
     (a) The director may refuse to renew or
may suspend or revoke a license issued under ORS 744.002 or the authority under
a license to engage in any category of insurance business or any class of
insurance.
     (b) The director may refuse to issue a
license under ORS 744.002 or refuse to grant authority under a license to
engage in any category of insurance business or any class of insurance.
     (2) The director may take any disciplinary
action under subsection (1) of this section on one or more of the following
grounds:
     (a) Incompetence or untrustworthiness of
the applicant or adjuster or insurance consultant.
     (b) Falsification by the applicant or
adjuster or insurance consultant of the application for the license or an
amendment thereto, or engagement in any dishonest act in relation to the
application or examination therefor.
     (c) Violation of or noncompliance with any
applicable provision of the Insurance Code or any rule or order of the
director.
     (d) Misappropriation or conversion to the
adjusterÂ’s or insurance consultantÂ’s own use, or illegal withholding, of money
or property belonging to policyholders, insurers, beneficiaries or others, and
received by the adjuster or insurance consultant in the conduct of business
under the license.
     (e) Conviction in any jurisdiction, of an
offense which if committed in this state, constitutes a felony, a misdemeanor
involving dishonesty or breach of trust, or an offense punishable by death or
imprisonment under the laws of the
     (f) Material misrepresentation of the
terms of any insurance policy or proposed insurance policy.
     (g) Use of a fraudulent or dishonest
practice by the adjuster or insurance consultant in the conduct of business
under the license, or demonstration therein that the adjuster or insurance
consultant is incompetent, untrustworthy or a source of injury and loss to the
public or others.
     (h) Error by the director in issuing or
renewing a license.
     (i) Failure to pay a civil penalty
assessed by the director that has become final by operation of law or upon
appeal.
     (j) Failure to pay any fee or charge to
the director.
     (k) Use of the license principally to
effect insurance on property or against liability of the applicant or adjuster
or insurance consultant, or to evade the provisions of ORS chapter 746.
     (L) Cancellation, revocation, suspension
or refusal to renew by any state of a license or other evidence of authority to
act as an insurance producer, adjuster or insurance consultant. The record of
the cancellation, revocation, suspension or refusal to renew shall be
conclusive evidence of the action taken.
     (m) Cancellation, revocation, suspension
or refusal to renew by any state or federal agency of the authority to practice
law or to practice under any other regulatory authority if the cancellation,
revocation, suspension or refusal to renew was related to the business of an
insurance producer, adjuster or insurance consultant or if dishonesty, fraud or
deception was involved. The record of the cancellation, revocation, suspension
or refusal to renew shall be conclusive evidence of the action taken.
     (n) Failure to comply with continuing
education requirements applicable to the license or any category of insurance
authorized under the license, unless the director has waived the requirements.
     (o) Dishonesty, fraud or misrepresentation
not related to the business of an insurance producer, adjuster or insurance
consultant.
     (3) The director may refuse to issue or
renew or may revoke or suspend the license of a firm or corporation or may take
any such action with respect to any authority applied for by or granted to the
firm or corporation to engage under the license in any category of insurance
business or class of insurance if the director finds that any ground set forth
in subsection (2) of this section exists:
     (a) With respect to any individual
adjuster or insurance consultant employed by or under contract with the firm or
corporation.
     (b) With respect to a director or officer
of the firm or corporation.
     (c) With respect to any person who
directly or indirectly has the power to direct or cause to be directed the
management, control or activities of the adjuster or insurance consultant. [Formerly
744.255; 1991 c.810 §4; 1993 c.447 §84; 2001 c.191 §31; 2003 c.364 §118; 2003
c.576 §258]
     744.014
Condition of probation on license or on category or class of insurance;
disciplinary action during probationary period. (1) The Director of the Department of
Consumer and Business Services may place a condition of probation on an
adjuster or insurance consultant license or on a category of insurance business
authorized by a license or on a class of insurance if any ground for
disciplinary action under ORS 744.013 exists, as follows:
     (a) When the license is initially issued.
     (b) When the license is renewed, amended
or reinstated, or when a new license is issued for the purpose of adding a
category of insurance business or class of insurance.
     (c) At any time during the effective
period of the license.
     (2) During a probationary period under
this section, the director may take any action authorized under ORS 744.013.
     (3) A license applicant or licensee has
the same right to a hearing on the placing of a condition of probation as the
license applicant or licensee has with respect to any action taken by the
director under ORS 744.013. [Formerly 744.260; 2001 c.191 §32]
     744.015 [1967 c.359 §526; 1989 c.701 §22; renumbered
744.054 in 1989]
     744.016 [Formerly 744.265; repealed by 2001 c.191 §61]
     744.017 [1971 c.231 §8; 1989 c.701 §42; renumbered
744.245 in 1989]
     744.018
Reinstatement of license; modification of suspension. With regard to any license issued under this
chapter:
     (1) The Director of the Department of
Consumer and Business Services may reinstate a revoked license, any revoked
category of insurance business or any revoked class of insurance. The director
may grant reinstatement upon fulfillment by the former holder of the license of
conditions set by the director.
     (2) The director may modify the suspension
of a license, a category of insurance business or a class of insurance and
reinstate the license, category or class:
     (a) At a time certain; or
     (b) When the person subject to the
suspension fulfills conditions set by the director for reinstatement. [1989
c.701 §12; 2001 c.191 §43]
     744.020 [Repealed by 1967 c.359 §704]
     744.022
Authorized activities. (1) A
firm or corporate adjuster or insurance consultant may engage in a category of
insurance business or a class of insurance authorized on its license only
through an individual adjuster or insurance consultant who is authorized to
engage in insurance business in that same category or class.
     (2) An individual adjuster or insurance
consultant who is employed by or under contract with a firm or corporate
adjuster or insurance consultant may engage in insurance business only to the
extent authorized by the license of the individual. [1989 c.701 §15; 2001 c.191
§33]
     744.024
Places of business for resident adjuster or insurance consultant; records. (1) Each resident adjuster or insurance
consultant shall maintain in this state a place of business in which the
licensee principally engages in insurance business under the license.
     (2) The principal place of business under
subsection (1) of this section of an adjuster or insurance consultant must be
accessible to the public.
     (3) An adjuster or insurance consultant
shall keep at the place of business of the adjuster or insurance consultant the
usual and customary records pertaining to the business under the license. All
such records as to any particular transactions shall be kept available and open
to the inspection of the Director of the Department of Consumer and Business
Services during business hours. An adjuster or insurance consultant shall keep
records of a particular transaction by the adjuster or insurance consultant for
three years following the conclusion of the transaction.
     (4) This section does not prohibit
maintenance of a place of business under a license in the licenseeÂ’s place of
residence in this state. [1989 c.701 §16; 2001 c.191 §34]
     744.025 [1967 c.359 §527; 1971 c.385 §6; 1979 c.501 §3;
1979 c.829 §9a; 1981 c.247 §18; 1983 c.464 §1; 1985 c.762 §188; 1989 c.701 §23;
renumbered 744.057 in 1989]
     744.026
Place of business for nonresident adjuster or insurance consultant; records. (1) A nonresident adjuster or insurance
consultant shall keep at the principal place of business of the licensee the
usual and customary records pertaining to the business under the nonresident
license. All such records as to any particular transaction shall be kept
available and open to the inspection of the Director of the Department of
Consumer and Business Services during business hours. For the purpose of this
subsection, if a nonresident licensee has a place of transacting insurance in
this state, that place shall be the principal place of business for the
licensee.
     (2) A nonresident adjuster or insurance
consultant shall keep records of a particular transaction by the nonresident
adjuster or insurance consultant for three years following conclusion of the
transaction. [1989 c.701 §17; 1995 c.639 §4; 2001 c.191 §35]
     744.028
Notice of change of address or telephone number. (1) Not later than the 30th day after an
adjuster or insurance consultant changes the address or telephone number of the
principal place of business or the residence of the adjuster or insurance
consultant, or any other location at which the licensee transacts business
under the license, the licensee shall notify the Director of the Department of
Consumer and Business Services of the change. The licensee also shall so notify
the director not later than the 30th day after the licensee opens or closes a
location at which the licensee transacts business under the license.
     (2) Not later than the 30th day after a change
in or deletion or addition of an assumed business name under which a licensee
transacts business under a license as an adjuster or insurance consultant, the
licensee shall notify the director of the change. [1989 c.701 §18; 2001 c.191 §36]
     744.030 [Amended by 1965 c.610 §12; repealed by 1967
c.359 §704]
     744.031
Notice of personnel changes from firm or corporate adjuster or insurance consultant
to director; rules. (1) Not
later than the 30th day after the authority of an individual adjuster or insurance
consultant to act for a firm or corporate adjuster or insurance consultant has
commenced or terminated, the firm or corporate adjuster or insurance consultant
shall notify the Director of the Department of Consumer and Business Services
of the commencement or termination.
     (2) A firm or corporate adjuster or
insurance consultant shall notify the director annually of all changes in its
officers and directors during the immediately previous calendar year. If the
licensee is a corporation, the licensee shall include in the notice any changes
in its stockholders who own, directly or indirectly, more than 10 percent of
any class of any equity security of the licensee.
     (3) The director may establish by rule a
different period within which a firm or corporate adjuster or insurance
consultant must notify the director under subsection (1) or (2) of this
section. [1989 c.701 §19; 2001 c.191 §37]
     744.033
Manner of application or notification. Any application or notice to the Director of the Department of Consumer
and Business Services regarding the licensing of an adjuster or insurance
consultant under this chapter must be made in the manner prescribed by the
director. [1989 c.701 §20; 2001 c.191 §38]
     744.035 [1967 c.359 §528; 1985 c.697 §18; repealed
by 1989 c.701 §81]
     744.037
Fees; refunds; rules. A fee
paid in connection with a license or a license application under this chapter
is not refundable unless the Director of the Department of Consumer and
Business Services provides otherwise by rule. [1989 c.701 §7; 2001 c.191 §44]
     744.039 [1991 c.810 §22; 2001 c.191 §23; renumbered
744.077 in 2001]
     744.040 [Repealed by 1967 c.359 §704]
     744.045 [1967 c.359 §529; 1983 c.76 §2; 1987 c.916 §8;
1989 c.331 §33; 1989 c.701 §25; renumbered 744.066 in 1989]
     744.050 [Repealed by 1953 c.93 §2]
     744.051 [1989 c.701 §21; 1991 c.810 §5; repealed by
2001 c.191 §61]
INSURANCE
PRODUCERS
     744.052
Definitions. As used in ORS
744.052 to 744.089:
     (1) “Business entity” has the meaning
given that term in ORS 731.116.
     (2) “Home state” means any state, district
or territory of the United States, in which an insurance producer maintains the
insurance producerÂ’s principal place of residence or principal place of
business and is licensed to act as an insurance producer.
     (3) “Limited class credit insurance”
includes but is not limited to credit life, credit disability, credit property,
credit unemployment, involuntary unemployment, mortgage life, mortgage
guaranty, mortgage disability, and guaranteed automobile protection insurance,
and any other form of insurance offered in connection with an extension of
credit that is limited to partially or wholly extinguishing the credit
obligation that the Director of the Department of Consumer and Business
Services determines should be designated a form of limited class credit
insurance.
     (4) “Limited class credit insurance
producer” means a person required to be licensed to sell, solicit or negotiate
one or more forms of limited class credit insurance coverage to individuals
through a master, corporate, group or individual policy.
     (5) “Limited class insurance” includes but
is not limited to credit, mortgage, automobile dealer guaranteed automobile
protection and any other form of insurance designated by the director as a form
of limited class insurance.
     (6) “Limited class insurance producer”
means a person required to be licensed to sell, solicit or negotiate one or
more forms of limited class insurance coverage to individuals through a master,
corporate, group or individual policy.
     (7) “Negotiate,” “sell” and “solicit” have
the meanings given those terms in ORS 731.104.
     (8) “Terminate” means to cancel the
relationship between an insurance producer and the insurer or to revoke an
insurance producerÂ’s authority to sell, solicit or negotiate insurance.
     (9) “Uniform Application” means the
current version of the Uniform Application for resident and nonresident
insurance producer licensing, produced by the National Association of Insurance
Commissioners.
     (10) “Uniform Business Entity Application”
means the current version of the Uniform Business Entity Application for
resident and nonresident business entities, produced by the National
Association of Insurance Commissioners. [2001 c.191 §2; 2003 c.364 §2]
     744.053
Requirements to be licensed as insurance producer for class of insurance. A person may not sell, solicit or negotiate
insurance in this state for any class or classes of insurance unless the person
is licensed as an insurance producer for that class or those classes in
accordance with ORS 744.052 to 744.089. [2001 c.191 §3; 2003 c.364 §3]
     744.054 [Formerly 744.015; 1991 c.810 §6; repealed
by 2001 c.191 §61]
     744.055 [1967 c.359 §530; 1971 c.231 §27; 1987 c.222
§1; 1989 c.701 §27; renumbered 744.071 in 1989]
     744.056
Exemptions from insurance producer licensing requirements. (1) ORS 744.052 to 744.089 do not require an
insurer to obtain a license as an insurance producer as required by ORS
744.053. For purposes of this section, the term “insurer” does not include an
insurerÂ’s officers, directors, employees, subsidiaries or affiliates.
     (2) A license as an insurance producer is
not required of any of the following:
     (a) An officer, director or employee of an
insurer or an insurance producer, if the officer, director or employee does not
receive any commission on or fee for policies written or sold to insure risks
residing, located or to be performed in this state and:
     (A) The officer’s, director’s or employee’s
activities are executive, administrative, managerial, clerical or a combination
of these, and are only indirectly related to the sale, solicitation or
negotiation of insurance;
     (B) The officer’s, director’s or employee’s
function relates to underwriting, loss control, inspection or the processing,
adjusting, investigating or settling of a claim on a contract of insurance; or
     (C) The officer, director or employee is
acting in the capacity of an agency supervisor assisting insurance producers
when the personÂ’s activities are limited to providing technical advice and
assistance to insurance producers and do not include the sale, solicitation or
negotiation of insurance.
     (b) A person who does either of the
following, when the person does not receive any commission or fee for the
service:
     (A) Secures and furnishes information for
the purpose of group life insurance, group property and casualty insurance,
group annuities or group or blanket health insurance or for the purpose of
enrolling individuals under plans, issuing certificates under plans or
otherwise assisting in administrative plans; or
     (B) Performs administrative services
related to mass-marketed property and casualty insurance.
     (c) An employer or an association of
employers or its officers, directors or employees, or the trustees of an
employee trust plan:
     (A) To the extent that the employers,
associations, directors, officers, employees or trustees are engaged in the
administration or operation of a program of employee benefits for the employerÂ’s
or associationÂ’s own employees or the employees of its subsidiaries or affiliates;
     (B) To the extent that the program of
employee benefits involves the use of insurance issued by an insurer; and
     (C) As long as the employers,
associations, officers, directors, employees or trustees are not in any manner
compensated, directly or indirectly, by the insurer issuing the insurance.
     (d) An employee of an insurer or an
organization employed by insurers who is engaging in the inspection, rating or
classification of risks, or in the supervision of the training of insurance
producers and who is not individually engaged in the sale, solicitation or
negotiation of insurance.
     (e) A person whose activities in this
state are limited to advertising without the intent to solicit insurance in
this state through communications in printed publications or electronic mass
media, the distribution of which is not limited to residents of this state, but
only if the person does not sell, solicit or negotiate insurance that would
insure risks residing, located or to be performed in this state.
     (f) A person who is not a resident of this
state who sells, solicits or negotiates a policy of insurance for commercial
property and casualty risks to an insured with risks located in more than one
state insured under that policy, but only if the person is otherwise licensed
as an insurance producer to sell, solicit or negotiate that insurance in the
state where the insured maintains its principal place of business and the
contract of insurance insures risks located in that state.
     (g) A salaried full-time employee who
counsels or advises the employer of the employee relative to the insurance
interests of the employer or of the subsidiaries or business affiliates of the
employer, but only if the employee does not sell or solicit insurance or
receive any commission.
     (h) An attorney in fact of an authorized
reciprocal insurer, or the salaried representative of the insurer or attorney
who does not receive any commission.
     (i) A person engaging in the lawful
transaction of reinsurance.
     (j) Salaried employees of title insurance
producers or insurers, except for the individual or individuals designated as
exercising the powers conferred by a title insurance producerÂ’s license.
     (k) Any agent or representative of persons
exempt from the Insurance Code under ORS 731.036 or holding a certificate of
exemption under ORS 731.042, with respect to the exempted transactions.
     (L) Any agent or representative of a
fraternal benefit society who devotes, or intends to devote, less than 50
percent of the agentÂ’s or representativeÂ’s time to the solicitation and
procurement of insurance policies for that society. Any person who in the
preceding calendar year has solicited and procured life insurance policies on
behalf of any fraternal benefit society for an amount of insurance in excess of
$50,000 or, in the case of any other class or classes of insurance that the
society might write, on the persons of more than 25 individuals, and who has
received or will receive a commission or other compensation therefor, shall be
presumed to be devoting, or intending to devote, 50 percent or more of the
personÂ’s time to the solicitation and procurement of insurance policies for
that society.
     (m) An individual engaging in the lawful
transaction of home protection insurance if the individual is a real estate licensee
as defined in ORS 696.010, and if the transaction of such insurance by the
individual is subject to a written contract, to which the insurer is a party,
governing the individualÂ’s activities in the transaction.
     (n) Salaried employees of a financial
institution or trust company, as those terms are defined in ORS 706.008, who,
in the regular course of business with the customers of the financial
institution or trust company, present the customers with written information
about savings account annuities issued by an authorized insurer. Any person who
purchases such an annuity may rescind the transaction within 10 days after the
issuance of the contract. For purposes of this paragraph, “savings account
annuities” means annuities purchased with the proceeds of a savings account,
certificate or share in a financial institution or trust company.
     (3) A person who provides general
insurance advice in connection with providing other professional services such
as legal services, trust services, tax and accounting services, financial
planning or investment advisory services is not considered to be soliciting the
sale of insurance for the purpose of the definition of “insurance producer” in
ORS 731.104. [2001 c.191 §4; 2003 c.364 §4; 2003 c.802 §175; 2007 c.71 §242;
2007 c.319 §34]
     744.057 [Formerly 744.025; 1997 c.631 §547; 1999
c.59 §227; repealed by 2001 c.191 §61]
     744.058
Written examination; fees; rules. (1) An individual applying for a resident insurance producer license
must pass a written examination unless the individual is exempt from the
prelicensing education and examination requirement as provided in ORS 744.067.
The examination must test the knowledge of the individual concerning the class
or classes of insurance for which application is made, the duties and
responsibilities of an insurance producer and the insurance statutes and rules
of this state. Except as provided in subsection (2) of this section, the
examination required by this section shall be developed and conducted by the
Director of the Department of Consumer and Business Services. An individual may
apply for a resident insurance producer license only if the individual has
established in this state a residence or a place of business for acting as an
insurance producer.
     (2) The director may make arrangements,
including contracting with a private testing service, for developing and
administering the examination and collecting applicable fees.
     (3) Each individual applying to take an
examination shall pay fees as established by the director.
     (4) An individual who fails to appear for
the examination as scheduled or fails to pass the examination may reapply to
take the examination according to requirements and procedures established by
the director by rule. [2001 c.191 §5; 2003 c.364 §5]
     744.059
Qualifications for license; use of uniform application. (1) An individual applying for a resident
insurance producer license shall apply to the Director of the Department of
Consumer and Business Services on the Uniform Application and shall declare
that the statements made in the application are true, correct and complete to
the best of the individualÂ’s knowledge and belief. Before approving the
application, the director must find that the individual:
     (a) Is at least 18 years of age;
     (b) Has not committed an act that is a
ground for action on a license set forth in ORS 744.074;
     (c) When required by the director, has
completed a prelicensing course of study for the lines of authority for which
the person has applied;
     (d) Has paid all applicable fees; and
     (e) Has successfully passed the
examination for the lines of authority for which the person has applied.
     (2) A business entity acting as an
insurance producer is required to obtain an insurance producer license.
Application shall be made on the Uniform Business Entity Application. Before
approving the application, the director must find that:
     (a) The business entity has paid all
applicable fees; and
     (b) The business entity has designated a
licensed insurance producer responsible for the business entityÂ’s compliance
with the insurance laws and rules of this state.
     (3) The director may require any documents
necessary to verify the information contained in an application.
     (4) Each insurer that sells, solicits or
negotiates any form of limited class credit insurance shall provide to each
limited class credit insurance producer a program of instruction, which is
subject to review and approval by the director. [2001 c.191 §6; 2003 c.364 §6]
     744.060 [Repealed by 1953 c.93 §2]
     744.061
Banking institution as insurance producer. (1) The Insurance Code does not limit or prohibit the licensing of a
banking institution, as defined in ORS 706.008, as an insurance producer to
transact one or more of the classes of insurance described in ORS 744.062,
except for title insurance.
     (2) The Insurance Code does not limit or
prohibit the licensing, as an insurance producer to transact one or more of the
classes of insurance described in ORS 744.062, of any of the following:
     (a) A corporation owned in whole or in part
by a banking institution under ORS 708A.120, 716.588 or 716.594.
     (b) A corporation owned in whole or in
part by a financial holding company or a bank holding company, as defined in
ORS 706.008. [1989 c.701 §24; 1997 c.631 §548; 2001 c.191 §24; 2001 c.377 §51;
2003 c.364 §7; 2005 c.194 §5]
     744.062
Issuance of insurance producer license; rules. (1) Unless the Director of the Department of
Consumer and Business Services refuses to issue or renew a license pursuant to
ORS 744.074, a person who has met the requirements of ORS 744.058 and 744.059,
or ORS 744.063, shall be issued an insurance producer license. An insurance
producer may receive qualification for a license in one or more of the
following classes of insurance:
     (a) Life insurance as defined in ORS
731.170.
     (b) Health insurance as defined in ORS
731.162.
     (c) Property insurance as defined in ORS
731.182.
     (d) Casualty insurance as defined in ORS
731.158.
     (e) Variable life insurance, including
variable annuities.
     (f) Property and casualty insurance
coverage sold to individuals and families for primarily noncommercial purposes.
     (g) Limited class credit insurance.
     (h) Any form of insurance designated by
the director as a form of limited class insurance.
     (i) Title insurance as defined in ORS 731.190.
A license for the class of title insurance may be issued only to a resident
insurance producer.
     (j) Any other class of insurance permitted
under the Insurance Code or rules adopted thereunder.
     (2) For assistance in performance of the
directorÂ’s duties, the director may participate with the National Association
of Insurance Commissioners, or any affiliate or subsidiary that the National
Association of Insurance Commissioners oversees, in a centralized producer
licensing registry in which insurance producer licenses and appointments are
centrally or simultaneously effected for all states that require an insurance
producer license. The director may adopt by rule any uniform standards and
procedures as are necessary to participate in the registry, including the
centralized collection of fees for licenses or appointments that are processed
through the registry.
     (3) An insurance producer may apply to
amend a license for the purpose of adding or deleting a class of insurance on
the license in the manner prescribed for license application in ORS 744.059 or
744.063, or as otherwise prescribed by the director. [2001 c.191 §8; 2003 c.364
§8]
     744.063
Nonresident insurance producer license; fee. (1) Unless the Director of the Department of Consumer and Business Services
refuses to issue or renew a license pursuant to ORS 744.074, a nonresident
person shall receive a nonresident insurance producer license if:
     (a) The person is currently licensed as a
resident insurance producer and is in good standing in the personÂ’s home state;
     (b) The person has submitted the proper
request for a nonresident insurance producer license and has paid the
applicable fees;
     (c) The person has submitted or
transmitted to the director the resident insurance producer license application
that the person submitted to the personÂ’s home state, or in lieu of that
application, a completed Uniform Application; and
     (d) The person’s home state grants
nonresident insurance producer licenses to residents of this state on the same
basis.
     (2) The director may verify the insurance
producerÂ’s licensing status through the Producer Database maintained by the
National Association of Insurance Commissioners, its affiliates or
subsidiaries.
     (3) A nonresident insurance producer
licensed in this state who moves from one state to another state or a resident
insurance producer who moves from this state to another state shall file with
the director a change of address and provide certification from the new
resident state not later than the 30th day after the change of legal residence.
No fee or license application is required under this subsection.
     (4) A person licensed as a surplus lines
insurance producer in the personÂ’s home state shall receive a nonresident
surplus lines insurance producer license pursuant to subsection (1) of this
section. Except as provided in subsection (1) of this section, nothing in this
section supersedes any provision of ORS 735.400 to 735.495.
     (5) Notwithstanding any other provision of
ORS 744.052 to 744.089, the director shall issue a nonresident limited class
insurance producer license pursuant to subsection (1) of this section to a
person who is licensed as a limited class credit insurance producer or as
another type of limited class insurance producer under the laws of the personÂ’s
home state that restrict the authority of the license to less than the
authority prescribed in ORS 744.062 for the classes of life insurance, health
insurance, property insurance or casualty insurance.
     (6) A license for the class of title
insurance may not be issued to a nonresident insurance producer.
     (7) The director is the attorney in fact
of a person to whom a license is issued under this section, and upon whom all
legal process in any action or proceeding against the person may be served. Any
legal process against the person that is served upon the director has the same
legal force and validity as if served upon the person. The authority of the
director under this subsection continues as long as any liability remains
outstanding in this state. The director becomes the attorney in fact of the
person on the date that the director issues the nonresident insurance producer
license to the person. [2001 c.191 §7; 2003 c.364 §9]
     744.064
Persons licensed elsewhere.
(1) Unless denied a license pursuant to ORS 744.074, a person who is currently
licensed as a resident insurance producer in a Canadian province, in Mexico or
in a state that does not grant nonresident insurance producer licenses to
residents of this state on the same basis that this state grants nonresident
insurance producer licenses under ORS 744.063 shall receive a nonresident
insurance producer license if:
     (a) The Director of the Department of
Consumer and Business Services determines that the insurance regulator in the
personÂ’s place of residence grants nonresident insurance producer licenses to
residents of this state on the same basis that the director grants nonresident
insurance producer licenses to residents of the other jurisdiction or on the
same basis that the insurance regulator grants insurance producer licenses to
residents of the other jurisdiction, or on another basis that is reasonable and
fair to licensees of this state; and
     (b) The person meets all of the following
requirements:
     (A) The person is in good standing as a
resident insurance producer in the personÂ’s place of residence in
     (B) The person has submitted the proper
request for a nonresident insurance producer license and has paid the
applicable fees.
     (C) The person has submitted or
transmitted to the Director of the Department of Consumer and Business Services
the resident insurance producer license application that the person submitted
to the insurance regulator in the personÂ’s place of residence, or in lieu of
that application, a completed Uniform Application.
     (D) The person has taken and passed a
written examination specified by the director under this section with respect
to the authority to transact the class or classes of insurance for which the
applicant has applied. The requirement of an examination does not apply to an
applicant that is a business entity.
     (E) The person has satisfied any other
qualifications established by the director by rule or has satisfied
qualifications that the director establishes by rule in lieu of the
qualifications established in this subsection.
     (2) A person who is licensed by this state
to sell, solicit or negotiate insurance as a nonresident insurance producer
under this section may sell, solicit or negotiate any policy of insurance upon
domestic risks to the same extent and upon the same terms as provided by the
insurance regulator in the personÂ’s place of residence for residents of this
state transacting a like business in a province of Canada, in Mexico or in the
personÂ’s state of residence.
     (3) The examination requirement under
subsection (1) of this section is subject to waiver if:
     (a) The director determines that a written
examination or other comparable requirement acceptable to the director is
required of applicants for a resident insurance producer license in the other
jurisdiction;
     (b) The insurance regulator of the other
jurisdiction certifies that the applicant holds a valid license as a resident
insurance producer in the other jurisdiction and either passed the written
examination, was the holder of a resident insurance producer license prior to
the time the written examination was first required or meets the other
comparable requirement acceptable to the director; and
     (c) In the other jurisdiction, a resident
of this state is privileged to procure an insurance producer license upon
conditions that the director determines to be reasonable and fair to licensees
of this state.
     (4) The director shall establish the form
of the nonresident insurance producer license issued under this section.
     (5) A person licensed as a surplus lines
insurance producer in the personÂ’s home state is eligible for a nonresident
surplus lines insurance producer license in the manner provided for nonresident
insurance producer licenses in subsection (1) of this section. A person to whom
a nonresident surplus lines insurance producer license is issued under this
section is subject to ORS 735.400 to 735.495.
     (6) The director is the attorney in fact
of a person to whom a license is issued under this section, and upon whom all
legal process in any action or proceeding against the person may be served. Any
legal process against the person that is served upon the director has the same
legal force and validity as if served upon the person. The authority of the
director under this subsection continues as long as any liability remains
outstanding in this state. The director becomes the attorney in fact of the
person on the date that the director issues the nonresident insurance producer
license to the person. This subsection does not apply to a person to whom a
nonresident surplus lines insurance producer license is issued. [2001 c.191 §9;
2003 c.364 §10]
     744.065 [1967 c.359 §531; 1969 c.336 §14; 1973 c.89 §1;
1983 c.76 §3; 1989 c.413 §10; repealed by 1989 c.701 §81]
     744.066 [Formerly 744.045; repealed by 2001 c.191 §61]
     744.067
Exemptions from prelicensing education or examination requirement. (1) An individual who applies for a resident
insurance producer license in this state who is or was previously licensed as
an insurance producer for the same lines of authority in another state is not
required to complete any prelicensing education or examination. The exemption
under this subsection is available only if the individual is currently licensed
in the other state or if the application is received by the Director of the
Department of Consumer and Business Services not later than the 90th day after
the applicantÂ’s previous license was terminated and if the other state issues a
certification that, at the time of termination, the applicant was in good
standing in that state or the stateÂ’s Producer Database maintained by the
National Association of Insurance Commissioners, its affiliates or subsidiaries
indicate that the applicant is or was licensed in good standing for the class
of insurance requested.
     (2) A person licensed as an insurance
producer in another state who moves to this state must apply for a resident
insurance producer license not later than the 90th day after the date on which
the person established legal residence in order to qualify for a resident
insurance producer license pursuant to ORS 744.059. Neither prelicensing
education nor an examination is required of a person to whom this subsection
applies in order to obtain a license in a class of insurance described in ORS
744.062 if the person held a license in that class in the other state, except
when the director has determined otherwise by rule.
     (3) An individual who holds an industry
designation described in this subsection is not required to complete
prelicensing education or the examination required in ORS 744.058 if the
director is satisfied, by examination or otherwise, that the applicant is
knowledgeable in the particulars of the applicable provisions of the Insurance
Code. This subsection applies to:
     (a) An applicant for a license authorizing
the applicant to transact property or casualty insurance or both, upon whom the
American Institute for Chartered Property Casualty Underwriters has conferred
the Chartered Property Casualty Underwriter (C.P.C.U.) designation.
     (b) An applicant for a license authorizing
the applicant to transact life or health insurance, or both, upon whom the
     (4) The director may recognize one or more
industry designations as exempting an applicant from the prelicensing education
requirement or the examination required in ORS 744.058 or both. For each
industry designation that the director recognizes and for the extent of the exemption
to be given, the director shall consider the content, quality and scope of the
educational program required for the designation as well as other factors
determined by the director to be relevant.
     (5) An individual is not required to
complete prelicensing education or the examination required in ORS 744.058 or
744.064 for the following licenses:
     (a) A license authorizing the individual
to transact a type of limited class insurance, except as the director otherwise
provides by rule.
     (b) A license authorizing the individual
to transact title insurance. [2001 c.191 §10; 2003 c.364 §11]
     744.068
Required notifications; maintenance of usual and customary records; rules. (1) An insurance producer shall notify the
Director of the Department of Consumer and Business Services prior to
transacting business under the insurance producer license under any name other
than the insurance producerÂ’s legal name and prior to changing, deleting or
adding an assumed business name in connection with the insurance producerÂ’s
business under the insurance producer license.
     (2) A resident insurance producer shall
keep at the principal place of business of the insurance producer the usual and
customary records pertaining to the business under the resident insurance
producer license. All such records shall be kept available and open to the
inspection of the director during business hours. A resident insurance producer
shall keep records of insurance transacted by the insurance producer under the
license for three years following expiration of the policy unless the director
designates another period.
     (3) A nonresident insurance producer shall
keep at the principal place of business of the insurance producer the usual and
customary records pertaining to the business under the nonresident insurance
producer license. All such records shall be kept available and open to the
inspection of the director during business hours. For the purpose of this
subsection, if a nonresident insurance producer has a place of transacting
insurance in this state, that place shall be the principal place of business
for the nonresident insurance producer. A nonresident insurance producer shall
keep records of insurance transacted by the insurance producer under the
nonresident insurance producer license for three years following expiration of
the policy unless the director designates another period.
     (4) An insurance producer shall notify the
director of any of the following changes not later than the 30th day after the
date of the change:
     (a) A change of address or telephone
number of the principal place of business or any location at which the
insurance producer transacts business under the license in this state.
     (b) The opening or closing of a location
at which the insurance producer transacts business under the license in this
state.
     (c) A change of residence. This paragraph
applies only to a resident insurance producer.
     (5) Not later than the 30th day after the
authority of an individual insurance producer to act for an insurance producer
that is a business entity has commenced or terminated, the business entity
shall notify the director of the commencement or termination. The director may
establish by rule a different period within which the business entity must
notify the director under this subsection. [2001 c.191 §11; 2003 c.364 §12]
     744.069 [1989 c.701 §26; repealed by 2001 c.191 §61]
     744.070 [Amended by 1967 c.359 §480; renumbered
743.603]
     744.071 [Formerly 744.055; repealed by 2001 c.191 §61]
     744.072
Renewal or reinstatement of insurance producer license; continuing education;
rules. (1) An insurance
producer license remains in effect unless revoked or suspended as long as all
applicable fees are paid by the due date and, if the licensee is a resident
individual insurance producer, as long as the licensee has met applicable
continuing education requirements for resident individual insurance producers
under subsection (4) of this section by the due date. The renewal fee is due on
the last day of the month in which the second anniversary of the initial
issuance date of the license occurs and on the second anniversary following
each renewal. The Director of the Department of Consumer and Business Services
may establish another renewal period for the purpose of coordination with any
national registration or licensing system.
     (2) As a condition for or in connection
with the renewal of an insurance producer license the director may require the
insurance producer to file information with the director regarding use made of
the license during the previous year or two years, and especially showing
whether the license has been used principally for the writing of personal or
controlled insurance, as defined in ORS 746.065.
     (3) The director may require an insurance
producer, as a condition for renewal of the insurance producer license, to
fulfill any or all of the requirements then applicable to the original issuance
of the license.
     (4) The director by rule may establish
requirements for continuing education that each resident individual insurance
producer must satisfy as a condition for renewing the resident insurance
producer license. The hours of education so required shall not exceed 45 hours
annually during the first five years an individual is licensed, 24 hours
annually during the next five years an individual is licensed, and 12 hours
annually for individuals licensed for more than 10 years or for individuals who
have received the designation C.P.C.U., C.L.U. or comparable designation
recognized by the director. Continuing education shall not be required for:
     (a) Any person to whom a license is issued
without examination pursuant to ORS 744.067 (5);
     (b) Any retired person who is authorized
to transact life insurance only, if the person is 58 years of age or more, has
10 yearsÂ’ experience as a licensed insurance producer, will be servicing
existing policies only and requests an exemption from the requirement; or
     (c) Any person whose license is indorsed
to authorize the person to act as a reinsurance intermediary broker or
reinsurance intermediary manager, or both, as described in ORS 744.800, but the
exemption applies solely for the purpose of maintaining the indorsement and
does not affect any continuing education requirement that otherwise applies.
     (5) In connection with establishing
continuing education requirements under subsection (4) of this section, the
director may make arrangements, including contracting with a private service,
for establishing and operating a program and standards for approving and
registering continuing education programs and their providers.
     (6) An individual insurance producer who
allows the insurance producer license to lapse may apply to the director to
reinstate the same license within 12 months from the due date for renewal
without having to take and pass a written examination, but the insurance
producer must pay an amount for the reinstatement that is equal to double the
unpaid renewal fee for any renewal fee paid after the due date and must
complete any continuing education requirements not satisfied to date, including
the period for which the license was lapsed. A license reinstated under this
subsection is effective upon the date that the director grants the
reinstatement.
     (7) An individual insurance producer who
is unable to comply with license renewal procedures due to military service or
another extenuating circumstance such as a long term medical disability may
request a waiver from compliance with those procedures. The insurance producer
may also request a waiver of any examination requirement or any penalty imposed
for failure to comply with renewal procedures. [2001 c.191 §12; 2003 c.364 §13]
     744.073
Temporary insurance producer license. (1) The Director of the Department of Consumer and Business Services
may issue a temporary insurance producer license for a period not to exceed 180
days without requiring a written examination if the director determines that
the temporary license is necessary for the servicing of an insurance business
in the following cases:
     (a) To the surviving spouse or
court-appointed personal representative of a licensed insurance producer who
dies or becomes mentally or physically disabled to allow adequate time for the
sale of the insurance business owned by the insurance producer, for the
recovery or return of the insurance producer to the business, or to provide for
the training and licensing of new personnel to operate the insurance producerÂ’s
business;
     (b) To a member or employee of a business
entity licensed as an insurance producer, upon the death or disability of the
individual designated in the business entity application or the license;
     (c) To the designee of a licensed
insurance producer entering active service in the Armed Forces of the United
States; or
     (d) In any other circumstance in which the
director determines that the public interest will best be served by the
issuance of the license.
     (2) The director may by order limit the
authority of any temporary licensee in any way that the director determines to
be necessary to protect insureds and the public. The director may require the
temporary licensee to have a suitable sponsor who is a licensed insurance
producer or insurer and who assumes responsibility for all acts of the
temporary licensee and may impose other similar requirements designed to
protect insureds and the public. The director may revoke a temporary license if
the interest of insureds or the public is endangered. A temporary license may
not continue after the owner or the personal representative disposes of the
business. [2001 c.191 §13; 2003 c.364 §14]
     744.074
Authority of director to place licensee on probation or to suspend, revoke or
refuse to issue or renew license. (1) The Director of the Department of Consumer and Business Services
may place a licensee on probation or suspend, revoke or refuse to issue or
renew an insurance producer license and may take other actions authorized by
the Insurance Code in lieu thereof or in addition thereto, for any one or more
of the following causes:
     (a) Providing incorrect, misleading,
incomplete or materially untrue information in the license application.
     (b) Violating any insurance laws, or
violating any rule, subpoena or order of the director or of the insurance
commissioner of another state or
     (c) Obtaining or attempting to obtain a
license through misrepresentation or fraud.
     (d) Improperly withholding,
misappropriating or converting any moneys or properties received in the course
of doing insurance business.
     (e) Intentionally misrepresenting the
terms of an actual or proposed insurance contract or application for insurance.
     (f) Having been convicted of a felony, of
a misdemeanor involving dishonesty or breach of trust, or of an offense
punishable by death or imprisonment under the laws of the
     (g) Having admitted or been found to have
committed any unfair trade practice or fraud related to insurance.
     (h) Using fraudulent, coercive or
dishonest practices, or demonstrating incompetence, untrustworthiness or
financial irresponsibility in the conduct of business in this state or
elsewhere.
     (i) Cancellation, revocation, suspension
or refusal to renew by any state of a license or other evidence of authority to
act as an adjuster or an insurance producer or consultant. The record of the
cancellation, revocation, suspension or refusal to renew shall be conclusive
evidence of the action taken.
     (j) Cancellation, revocation, suspension
or refusal to renew by any state or federal agency, by a Canadian province or
by the government of Mexico of the authority to practice law or to practice
under any other regulatory authority if the cancellation, revocation,
suspension or refusal to renew was related to the business of an adjuster or an
insurance producer or consultant, or if dishonesty, fraud or deception was
involved. The record of the cancellation, revocation, suspension or refusal to
renew shall be conclusive evidence of the action taken.
     (k) Forging another person’s name to an
application for insurance or to any document related to an insurance
transaction.
     (L) Improperly using notes or any other
reference material to complete an examination for an insurance license.
     (m) Knowingly accepting insurance business
from an individual who is not licensed.
     (n) Error by the director in issuing or
renewing a license.
     (o) Failing to pay a civil penalty
assessed by the director that has become final by operation of law or upon
appeal.
     (p) Failing to pay any fee or charge to
the director.
     (q) Failing to comply with continuing
education requirements applicable to the license or any class of insurance
authorized under the license, unless the director has waived the requirements.
     (2) If the director refuses to issue or
renew an insurance producer license, the director shall notify the applicant or
licensee and inform the applicant or licensee in writing of the reason for the
refusal to issue or renew and of the applicantÂ’s or licenseeÂ’s rights under ORS
chapter 183.
     (3) The director may suspend, revoke or
refuse to issue or renew the insurance producer license of a business entity if
the director determines that an individual licenseeÂ’s violation was known or
should have been known by one or more of the partners, officers or managers
acting on behalf of the partnership or corporation but the violation was not
reported to the director and corrective action was not taken. [2001 c.191 §14;
2003 c.364 §15]
     744.075 [1967 c.359 §532; 1983 c.76 §4; 1989 c.701 §28;
1991 c.810 §7; repealed by 2001 c.191 §61]
     744.076
Payment of commission, service fee or brokerage. (1) An insurer or insurance producer may not
pay a commission, service fee, brokerage or other valuable consideration to a
person for selling, soliciting or negotiating insurance in this state if that
person is required to be licensed as an insurance producer and is not so
licensed.
     (2) A person shall not accept a
commission, service fee, brokerage or other valuable consideration for selling,
soliciting or negotiating insurance in this state if that person is required to
be licensed as an insurance producer and is not so licensed.
     (3) Renewal or other deferred commissions
may be paid to a person for selling, soliciting or negotiating insurance in
this state if the person was required to be licensed as an insurance producer
at the time of the sale, solicitation or negotiation and was then so licensed.
     (4) An insurer or insurance producer may
pay or assign commissions, service fees, brokerages or other valuable
consideration to an insurance agency or to persons who do not sell, solicit or
negotiate insurance in this state, except when the payment or assignment would
violate ORS 746.045 or 746.055. [2001 c.191 §15; 2003 c.364 §16]
     744.077
Conditions under which person licensed as insurance producer and consultant may
accept commission or fee; rules. (1) The Director of the Department of Consumer and Business Services
shall establish by rule the conditions under which a person who is licensed as
an insurance producer and as an insurance consultant may accept a commission or
a fee, or both, in a transaction or in related transactions. The director may
establish different conditions for such products as employee benefit plans,
insurance for personal, family or household purposes and insurance for
commercial purposes, and for any other insurance product as determined
appropriate by the director. In developing rules under this subsection, the
director shall take into account the requirements and characteristics of the
different insurance products and the varying degrees of trade practice
regulation needed.
     (2) Except as otherwise provided by rule,
an insurance producer who is not licensed as an insurance consultant may
receive only commission. [Formerly 744.039; 2003 c.364 §17]
     744.078
Appointment of insurance producers; rules. (1) An insurance producer shall not act as an agent of an insurer
unless:
     (a) The insurance producer is an appointed
agent of that insurer; or
     (b) The insurance producer transacts
insurance on behalf of another insurance producer who is an appointed agent of
that insurer according to conditions and limitations established by the
Director of the Department of Consumer and Business Services by rule.
     (2) Each insurer shall maintain a current
list of insurance producers contractually authorized to accept applications on
behalf of the insurer. Each insurer shall make the list available to the
director upon request.
     (3) An insurance producer may represent as
agent under one insurance producer license as many insurers as may appoint the
insurance producer in accordance with this section.
     (4) Except as provided in a group contract
of insurance under subsection (5) of this section, any person who solicits or
procures an application for insurance as an agent of the insurer shall in all
matters relating to the application for insurance and the policy issued in
consequence of the application be regarded as the agent of the insurer issuing
the policy and not the agent of the insured. Any provision in the application
and policy to the contrary is invalid and of no effect.
     (5) A group contract of insurance and the
individual certificate issued pursuant to the group contract may contain
provisions stating whether the group policyholder acts as the agent of the
individual insured or as the agent of the insurer. [2001 c.191 §16; 2003 c.364 §18]
     744.079
Termination of relationship with insurance producer. (1) An insurer or authorized representative
of the insurer who terminates the appointment, employment, contract or other
insurance business relationship with an insurance producer shall notify the
Director of the Department of Consumer and Business Services not later than the
30th day after the effective date of the termination, in the manner prescribed
by the director, if the reason for termination is one of the reasons set forth
in ORS 744.074 or if the insurer has knowledge that the insurance producer was
found by a court, government body or self-regulatory organization authorized by
law to have engaged in any of the activities set forth in ORS 744.074. Upon the
written request of the director, the insurer shall provide additional
information, documents, records or other data pertaining to the termination or
activity of the insurance producer.
     (2) An insurer or the authorized
representative of the insurer shall promptly notify the director in a manner
acceptable to the director if, upon further review or investigation, the
insurer discovers additional information that would have been reportable to the
director in accordance with subsection (1) of this section if the insurer had
then known of its existence.
     (3) Not later than the 15th day after
making a notification required by subsection (1) or (2) of this section, the
insurer shall mail a copy of the notification to the insurance producer at the
insurance producerÂ’s last known business address. If the insurance producer is
terminated for cause for any of the reasons listed in ORS 744.074, the insurer
shall provide a copy of the notification to the insurance producer at the
insurance producerÂ’s last known business address by certified mail, return
receipt requested, postage prepaid or by overnight delivery using a nationally
recognized carrier.
     (4) Not later than the 30th day after the
insurance producer has received a notification under subsection (3) of this
section, the insurance producer may file with the director written comments
concerning the substance of the notification. The insurance producer shall, by
the same means, simultaneously send a copy of the comments to the reporting
insurer. The comments shall become a part of the directorÂ’s file and shall
accompany every copy of a report distributed or disclosed for any reason about
the insurance producer as allowed under subsection (5) of this section.
     (5) In the absence of actual malice, an
insurer, the authorized representative of the insurer, an insurance producer,
the director or an organization of which the director is a member and that
compiles the information and makes it available to other insurance regulators
or regulatory or law enforcement agencies shall not be subject to civil
liability. In the absence of actual malice, a civil cause of action shall not
arise against any such entity or its agents or employees as a result of any
statement or information required by or provided pursuant to this section, or
any information relating to any statement that may be requested in writing by
the director from an insurer or insurance producer, or relating to a statement
by a terminating insurer or insurance producer to an insurer or insurance
producer, that is limited exclusively to whether a termination for cause under
subsection (1) of this section was reported to the director. Immunity under
this subsection is available only if the propriety of any termination for cause
under subsection (1) of this section is certified in writing by an officer or
authorized representative of the insurer terminating the relationship.
     (6) In any action brought against a person
who may have immunity under subsection (5) of this section for making any
statement required by this section or providing any information relating to any
statement that may be requested in writing by the director, the party bringing
the action must plead specifically in any allegation that subsection (5) of
this section does not apply because the person making the statement or
providing the information did so with actual malice.
     (7) Subsections (5) and (6) of this
section do not abrogate or modify any existing statutory or common law
privileges or immunities.
     (8) The director may take any
administrative action authorized by the Insurance Code, including suspension or
revocation of a license or certificate of authority, against an insurer, the
authorized representative of an insurer or an insurance producer who fails to
file notice as required by this section or who is found by a court of competent
jurisdiction to have filed notice with actual malice.
     (9) Any information, documents, records or
other data in the control or possession of the director that are furnished by
an insurer or an insurance producer, or an employee or agent thereof acting on
behalf of the insurer or insurance producer, or that are obtained by the
director in an investigation pursuant to this section shall be confidential,
shall not be subject to subpoena and shall not be subject to discovery nor
admissible in evidence in any private civil action. The director, however, may
use the confidential information, documents, records or other data in
administering this section and in the furtherance of any other regulatory or
legal action brought as a part of the directorÂ’s duties. The information,
documents, records or other data referred to in this subsection are subject to
the public officer privilege described in ORS 40.270. [2001 c.191 §17; 2003
c.364 §19]
     744.080 [Repealed by 1967 c.359 §704]
     744.081
Termination of appointment.
(1) An insurer may terminate an agency appointment at any time as provided in
this section. Termination shall be without prejudice to the contract rights, if
any, of the insurance producer so terminated. The insurer shall give written
notice of the termination and the date thereof to the insurance producer at
least 90 days prior to the effective date of the termination. The notice must
specify the reasons for the termination. The insurer shall deliver the notice
either in person or by mail at the address last provided by the insurance
producer to the insurer. The insurance producer shall not have a cause of
action against the insurer as a result of any statement in the notice unless
the statement is false and the insurer knew the statement was false when made.
     (2) An insurer may terminate an agency
appointment without giving the notice required by subsection (1) of this
section on any of the grounds specified in this subsection. The following are
grounds for termination under this subsection:
     (a) The insurance producer’s insurance
license is denied, restricted, revoked, suspended or canceled by any public
authority;
     (b) The insurance producer’s business is
sold, transferred or merged and the insurer has not appointed the successor;
     (c) The insurance producer is insolvent or
fails to remit balances to the insurer in accordance with the agreement;
     (d) The insurance producer commits fraud
or engages in intentional misconduct;
     (e) The insurer amends its certificate of
authority in order to discontinue a class of insurance;
     (f) The insurer ceases selling insurance
in this state; or
     (g) The insurer and insurance producer
mutually agree to terminate the agency appointment.
     (3) An insurance producer may terminate an
agency appointment at any time, but the termination shall be without prejudice
to the contract rights, if any, of the appointing insurer. The insurance
producer shall give written notice of the termination and the date thereof to
the director not later than the 30th day after the effective date of the
termination, and to the insurer. The director may require reasonable proof from
the insurance producer that the insurance producer has given such notice to the
insurer. [Formerly 744.175; 2003 c.364 §20]
     744.082
Waiver of requirement for nonresident insurance producer license applicant. The Director of the Department of Consumer
and Business Services shall waive any requirement for a nonresident insurance
producer license applicant with a valid resident insurance producer license
from the applicantÂ’s home state, except the requirements imposed by ORS
744.063, if the applicantÂ’s home state grants nonresident insurance producer
licenses to residents of this state on the same basis. [2001 c.191 §18; 2003
c.364 §21]
     744.083
Trust account for premium funds; commingling; exceptions; rules. (1) All premium funds received by a resident
insurance producer shall be accounted for and maintained in a trust account
separate from all other business and personal funds.
     (2) Except as provided in subsection (3)
of this section, a resident insurance producer may not commingle or otherwise
combine premiums with any other moneys.
     (3) A resident insurance producer may
commingle with premium funds in the trust account required by subsection (1) of
this section any additional funds the insurance producer deems prudent for the
purpose of advancing premiums, establishing reserves for the paying of return
premiums, or for any contingencies that may arise in the course of receiving
and transmitting premium or return premium funds.
     (4) This section does not apply to:
     (a) Any financial institution or trust
company, as those terms are defined in ORS 706.008, or any entity licensed
under ORS chapter 725 or 726.
     (b) Any class of insurance producers that
the Director of the Department of Consumer and Business Services designates by
rule. The director may exempt a class of insurance producer from this section
if the director determines that the requirements of this section are unduly
burdensome to the insurance producers in relation to the public good served. [Formerly
744.225; 2003 c.364 §22]
     744.084
Certificate of deposit in lieu of trust account; rules. (1) In lieu of the trust account required by
ORS 744.083, a resident insurance producer may keep a certificate of deposit
from an institution insured by the federal government or an instrumentality
thereof if the resident insurance producer has an average monthly balance of
premium funds received and held for the last 12 months of at least $2 million.
A resident insurance producer who keeps a certificate of deposit shall have
satisfactory evidence of the certificate available at all times for inspection
by the Director of the Department of Consumer and Business Services.
     (2) A certificate of deposit authorized
under subsection (1) of this section shall be for an amount at least equal to
the average monthly balance of premium funds received and held by the resident
insurance producer for the last 12 months. Nothing in this subsection requires
that the required amount of the certificate of deposit be calculated, or the
amount changed, more often than once a month.
     (3) The director may adopt rules
specifying what constitutes satisfactory evidence for purposes of subsection
(1) of this section.
     (4) Authorization to use a certificate of
deposit may be revoked by the director at any time upon a determination that
the resident insurance producer has failed to comply with the provisions of
this section or rules adopted under subsection (3) of this section. Upon
revocation, the resident insurance producer shall comply immediately with the
provisions of ORS 744.083. [Formerly 744.227; 2003 c.364 §23]
     744.085 [1967 c.359 §533; 1971 c.231 §28; 1977 c.174
§1; 1977 c.820 §1; 1979 c.501 §4; 1981 c.817 §1; 1983 c.76 §5; 1989 c.701 §29;
1991 c.810 §8; 1993 c.447 §85; 1995 c.334 §1; repealed by 2001 c.191 §61]
     744.086
Applicability of Insurance Code to insurance producers transacting title
insurance. The Legislative
Assembly finds that it is in the interest of the insurance-buying public that
insurance producers authorized to transact title insurance be subject to the
Insurance Code. It is declared to be the intent of the Legislative Assembly
that the Insurance Code shall apply to such insurance producer only to the
extent necessary for the regulation of title insurance ratemaking and unfair
trade practices. [Formerly 744.240; 2003 c.364 §24]
     744.087
Filing insurance producers compensation agreements; filing not public record. The Director of the Department of Consumer
and Business Services may require the filing by an insurer of any compensation
agreements for insurance producers who are appointed by the insurer as agents
of the insurer under ORS 744.078. No such filing shall be deemed a “public
record” as defined in ORS 192.410. [Formerly 744.245; 2003 c.364 §25]
     744.088
Training requirements to be licensed as insurance producer for long term care
insurance. (1) An individual
may not sell, solicit or negotiate long term care insurance unless the
individual is licensed as an insurance producer for health or life insurance
and satisfies the following training requirements:
     (a) The individual must complete a
one-time training course of not less than eight hours before selling,
soliciting or negotiating long term care insurance; and
     (b) The individual must complete ongoing
training of not less than four hours in each 24-month period following the
one-time training course.
     (2) The Director of the Department of
Consumer and Business Services may approve as continuing education courses
under ORS 744.072 any courses offered to satisfy the training requirements of
this section.
     (3) The training required by this section
must consist of topics related to long term care insurance, long term care
services and, if applicable, qualified state long term care insurance
partnership programs, including but not limited to:
     (a) State and federal rules and
requirements and the relationship between qualified state long term care
insurance partnership programs and other public and private coverage of long
term care services, including Medicaid.
     (b) Available long term care services and
providers.
     (c) Changes or improvements in long term
care services or providers.
     (d) Alternatives to the purchase of
private long term care insurance.
     (e) The effect of inflation on benefits
and the importance of inflation protection.
     (f) Consumer suitability standards and
guidelines.
     (4) The training required by this section
may not include training that is insurer or company product specific or that
includes any sales or marketing information, materials or training, other than
those required by state or federal law.
     (5) An insurer must:
     (a) Obtain verification that an insurance
producer receives training required by this section before an insurance
producer sells, solicits or negotiates the insurerÂ’s long term care insurance
products.
     (b) Maintain records subject to the state’s
record retention requirements.
     (c) Make the verification obtained under
paragraph (a) of this subsection available to the director upon request.
     (6) An insurer must maintain records with
respect to the training of its insurance producers concerning the distribution
of its partnership policies that will allow the director to provide assurance
to the state Medicaid agency that insurance producers have received training on
the topics described in subsection (3)(a) of this section and that insurance
producers have demonstrated an understanding of the partnership policies and
their relationship to public and private coverage of long term care, including
Medicaid, in this state. An insurer must make the records available to the
director upon request.
     (7) The satisfaction in any state of the
training required by this section is considered to satisfy the training
required by this section. [2007 c.486 §9]
     Note: Section 9a, chapter 486, Oregon Laws 2007,
provides:
     Sec.
9a. An individual who is
licensed on the effective date of this 2007 Act [June 20, 2007] and is subject
to the requirements of section 9 (1) of this 2007 Act [744.808 (1)] must, not
later than January 31, 2008:
     (1) Complete the entire one-time training
course required under section 9 (1)(a) of this 2007 Act;
     (2) Satisfy qualifications equivalent to
the training requirement under section 9 (1)(a) of this 2007 Act as specified
by the Director of the Department of Consumer and Business Services by rule; or
     (3) Satisfy the training requirement under
section 9 (1)(a) of this 2007 Act in part by completing a portion of the
one-time training course and for the remainder by satisfying qualifications
specified by the director by rule. [2007 c.486 §9a]
     744.089
Report of administrative action taken against insurance producer. (1) An insurance producer shall report to
the Director of the Department of Consumer and Business Services any
administrative action taken against the insurance producer in another
jurisdiction or by another governmental agency in this state not later than the
30th day after the date of the final disposition of the matter. This report
shall include a copy of the order, consent to order and other relevant legal
documents.
     (2) Not later than the 30th day after the
initial pretrial hearing date, an insurance producer shall report to the
director any criminal prosecution of the insurance producer taken in any
jurisdiction. The report shall include a copy of the initial complaint filed,
the order resulting from the hearing and any other relevant legal documents. [2001
c.191 §19; 2003 c.364 §26]
     744.090 [Amended by 1967 c.359 §370; renumbered
743.111]
     744.091
Additional conditions under which person licensed as insurer or insurance
producer may charge commission or service fee; rules. (1) An insurer or insurance producer may
charge a commission, a service fee or a combination of the two when transacting
insurance in other than the following categories of insurance:
     (a) Insurance that covers an individual’s
person, property or liability;
     (b) Life or health insurance for groups of
fewer than 51 lives; or
     (c) Insurance on a commercial or public
entity paying combined annual premiums of less than $100,000 for the insurance.
     (2) An insurer or insurance producer may
charge a commission or service fee other than the commission or fee filed in
accordance with ORS 737.205 only if the insurer or insurance producer has a
written agreement with the prospective insured prior to the binding or issuance
of an insurance policy. The Director of the Department of Consumer and Business
Services may establish by rule minimum conditions for written agreements
entered into under this subsection. An insurer or insurance producer who enters
into a written agreement as provided in this subsection is not in violation of
ORS 746.035 or 746.045. [2003 c.364 §17b]
     744.093
Solicitation or sale of insurance policy by retail insurance producer or
wholesale insurance producer; rules. (1) As used in this section:
     (a) “Retail insurance producer” means an
insurance producer who directly solicits or sells an insurance policy to a
prospective insured or directly negotiates an insurance policy with a
prospective insured.
     (b) “Wholesale insurance producer” means
an insurance producer who solicits or sells an insurance policy to a
prospective insured through a retail insurance producer or negotiates an
insurance policy for a prospective insured with a retail insurance producer and
does not solicit or sell directly to or negotiate directly with a prospective
insured.
     (2) A wholesale insurance producer who
sells, solicits or negotiates a policy directly with a retail insurance
producer and not on behalf of a prospective insured may charge the retail
insurance producer a fee or a combination of a fee and a commission if the
wholesale insurance producer has a written agreement with the retail insurance
producer prior to the binding or issuance of the insurance policy. The charge
must be commensurate with the services provided by the wholesale insurance
producer.
     (3) A retail insurance producer may charge
a fee to a prospective insured when the retail insurance producer pays a fee or
a combination of a fee and a commission to a wholesale insurance producer under
subsection (2) of this section if the retail insurance producer has a written
agreement with the prospective insured prior to the binding or issuance of the
insurance policy. The fee may not exceed the amount of compensation paid by the
retail insurance producer to the wholesale insurance producer.
     (4) For the purpose of determining the
charge under subsection (2) of this section, the retail insurance producer and
wholesale insurance producer may agree to any allocation of the fee that the
retail insurance producer charges the consumer under this section. The Director
of the Department of Consumer and Business Services may establish by rule
minimum conditions for written agreements entered into under this section. An
insurer or insurance producer who enters into a written agreement as provided
in this section is not in violation of ORS 746.035 or 746.045. [2003 c.364 §26b]
     744.095 [1967 c.359 §534; repealed by 1989 c.701 §81]
     744.100 [Repealed by 1967 c.359 §704]
     744.105 [1967 c.359 §535; 1971 c.231 §29; repealed
by 1989 c.701 §81]
     744.110 [Repealed by 1967 c.359 §704]
     744.115 [1967 c.359 §536; 1971 c.231 §30; 1973 c.515
§3; 1977 c.174 §2; 1979 c.501 §5; 1981 c.817 §2; 1987 c.774 §138; 1987 c.916 §9;
1989 c.331 §25; 1989 c.701 §30; 1991 c.810 §9; 1993 c.265 §7; 1995 c.334 §2;
repealed by 2001 c.191 §61]
     744.119 [Formerly 744.205; 1991 c.810 §10; 1993
c.447 §86; 1997 c.131 §4; repealed by 2001 c.191 §61]
     744.120 [Repealed by 1967 c.359 §704]
     744.123 [Formerly 744.195; repealed by 2001 c.191 §61]
     744.125 [1959 c.367 §1; 1967 c.359 §501; renumbered
743.666]
     744.127 [1989 c.701 §33; 1991 c.810 §11; repealed by
2001 c.191 §61]
     744.130 [Amended by 1955 c.226 §1; 1967 c.359 §502;
renumbered 743.669]
     744.135 [1967 c.359 §537; 1973 c.89 §2; repealed by
1989 c.701 §81]
     744.140 [Repealed by 1967 c.359 §704]
     744.145 [1967 c.359 §538; 1989 c.701 §35; repealed
by 2001 c.191 §61]
     744.150 [Repealed by 1967 c.359 §704]
     744.155 [1967 c.359 §539; 1971 c.231 §31; 1975 c.769
§5; 1989 c.413 §11; 1989 c.701 §§34,81c; 1993 c.265 §8; repealed by 2001 c.191 §61]
     744.160 [Repealed by 1967 c.359 §704]
     744.165 [Formerly 739.520; 1971 c.231 §32; 1983
c.265 §1; repealed by 2001 c.191 §61]
     744.170 [Repealed by 1967 c.359 §704]
     744.175 [1967 c.359 §541; 1975 c.769 §6; 1989 c.692 §§1,2;
1989 c.701 §36; 2001 c.191 §24a; renumbered 744.081 in 2001]
     744.180 [Repealed by 1967 c.359 §704]
     744.182 [1989 c.701 §37; 1995 c.639 §5; repealed by
2001 c.191 §61]
     744.185 [1967 c.359 §542; repealed by 1989 c.701 §81]
     744.190 [Repealed by 1967 c.359 §704]
     744.195 [1967 c.359 §543; 1989 c.413 §12; 1989 c.701
§§32,81d; renumbered 744.123 in 1989]
     744.200 [Repealed by 1967 c.359 §704]
     744.205 [1967 c.359 §544; 1977 c.820 §2; 1979 c.501 §6;
1981 c.817 §3; 1983 c.76 §6; 1989 c.701 §31; renumbered 744.119 in 1989]
     744.215 [1967 c.359 §545; 1989 c.413 §13; 1989 c.701
§40; renumbered 744.235 in 1989]
     744.225 [1987 c.569 §2; 1989 c.701 §38; 1997 c.631 §549;
2001 c.191 §24b; renumbered 744.083 in 2001]
     744.227 [1989 c.680 §2; 2001 c.191 §24c; renumbered
744.084 in 2001]
     744.231 [1989 c.701 §39; repealed by 2001 c.191 §61]
     744.235 [Formerly 744.215; repealed by 1993 c.265 §14]
     744.240 [Formerly 744.012; renumbered 744.086 in
2001]
     744.245 [Formerly 744.017; 1999 c.55 §4; renumbered
744.087 in 2001]
     744.255 [1967 c.359 §546; 1969 c.336 §15; 1983 c.76 §7;
1985 c.697 §15; 1987 c.774 §141; 1989 c.701 §8; renumbered 744.013 in 1989]
     744.260 [1971 c.231 §9; 1983 c.76 §8; 1985 c.697 §16;
1989 c.701 §9; renumbered 744.014 in 1989]
     744.265 [1967 c.359 §547; 1983 c.76 §9; 1989 c.701 §10;
renumbered 744.016 in 1989]
MANAGING
GENERAL AGENTS
     744.300
License and indorsement; managing general agent described. (1) A person shall not act as a managing
general agent with respect to risks located in this state for an authorized
insurer unless the person holds a license issued under ORS 744.062 authorizing
the person to act as an insurance producer and indorsed to authorize the person
to act as a managing general agent.
     (2) A person shall not act as a managing
general agent representing a domestic insurer with respect to risks located
outside this state unless the person holds a license issued under ORS 744.062 authorizing
the person to act as an insurance producer and indorsed to authorize the person
to act as a managing general agent.
     (3) For purposes of ORS 744.300 to
744.316, a person acts as a managing general agent when the person:
     (a) Negotiates and binds ceding
reinsurance contracts on behalf of an authorized insurer or manages all or part
of the insurance business of an authorized insurer, including the management of
a separate division, department or underwriting office, and acts as an
insurance producer for the insurer, whether the person is known as a managing
general agent, manager or other similar term; and
     (b) With or without the authority, either
separately or together with affiliates, produces, directly or indirectly, and
underwrites an amount of gross direct written premium equal to or more than
five percent of the policyholder surplus as reported in the last annual
statement of the insurer in any one quarter or year, together with either or
both of the following activities:
     (A) Adjusting or paying claims in excess
of an amount determined by the Director of the Department of Consumer and
Business Services.
     (B) Negotiating reinsurance on behalf of
the insurer.
     (4) The provisions of ORS 744.062
governing application for amendment of a license apply to the indorsement of
the license of an insurance producer for authority to act as a managing general
agent, except that an examination is not required for the indorsement.
     (5) The provisions of this section are
subject to exemptions stated in ORS 744.301. [1991 c.495 §2; 2001 c.191 §39;
2003 c.364 §119]
     744.301
Exemptions from license requirement. The following persons are exempt from ORS 744.300:
     (1) An employee of an insurer, when the
employee is acting as a managing general agent for the insurer.
     (2) A
     (3) An underwriting manager who, pursuant
to contract, manages all the insurance operations of the insurer, is under
common control with the insurer and is subject to ORS 732.517 to 732.592, and
whose compensation is not based on the volume of premiums written.
     (4) The attorney or attorney-in-fact
authorized by and acting for the subscribers of a reciprocal insurer or
interinsurance exchange under powers of attorney. [1991 c.495 §3; 1993 c.447 §63a]
     744.303
Certificate of errors and omissions insurance; rules. (1) A managing general agent must maintain
with the Director of the Department of Consumer and Business Services at all
times a current certificate of errors and omissions insurance, in an amount
established by the director by rule, from an insurer authorized to transact
insurance in this state or from any other insurer acceptable to the director
according to standards established by rule. The insurance must cover errors and
omissions of and any violation of fiduciary responsibility by the managing
general agent or its employees, or both.
     (2) If the director determines that
insurance required under this section is not generally available at a
reasonable cost, the director by rule may suspend the requirement of insurance,
but must reimpose the requirement when the insurance once again becomes
generally available. [1991 c.495 §4]
     744.305 [Formerly 750.010; repealed by 1987 c.774 §154]
     744.306
Contract between insurer and managing general agent. A person acting as a managing general agent
shall not place business with an insurer unless a written contract is in force
between the parties. The following requirements apply to such a contract:
     (1) The contract must set forth the
responsibilities of each party.
     (2) The contract must specify the division
of responsibility for a particular function, when both parties share
responsibility for the function.
     (3) The contract must include at least the
following provisions:
     (a) That the insurer may terminate the
contract for cause upon written notice to the managing general agent, and may
suspend the underwriting authority of the managing general agent while any
dispute regarding the cause for termination is pending.
     (b) That at least monthly, the managing
general agent shall report all transactions and remit all funds due under the
contract to the insurer.
     (c) That with respect to all funds
collected by a managing general agent for the account of an insurer, the
managing general agent must comply with ORS 744.083 or 744.084, except that the
managing general agent may retain in the account an amount not exceeding three
monthsÂ’ estimated claims payments and allocated loss adjustment expenses.
     (d) That the managing general agent shall
maintain separate records of business written by the managing general agent.
Further, that the managing general agent shall allow the insurer access to all
accounts and records related to its business, shall keep all such accounts and
records in a form usable by the insurer and shall allow the insurer to copy all
such accounts and records.
     (e) That the managing general agent shall
not assign the contract either in whole or part.
     (f) Appropriate underwriting guidelines,
including:
     (A) The maximum annual premium volume;
     (B) The basis of the rates to be charged;
     (C) The types of risks that may be
written;
     (D) Maximum limits of liability;
     (E) Applicable exclusions;
     (F) Territorial limitations;
     (G) Policy cancellation provisions; and
     (H) The maximum policy period.
     (g) That the insurer may cancel or
nonrenew any policy of insurance, subject to applicable statutes and rules
governing cancellation and nonrenewal of insurance policies.
     (h) Provisions addressing the timely
transmission of the data, when electronic claims files exist.
     (i) That if the contract provides for a
sharing of interim profits of the managing general agent and if the managing
general agent has the authority to determine the amount of the interim profits
by establishing loss reserves or controlling claim payments, or in any other
manner, interim profits shall not be paid to the managing general agent until
one year after they are earned for property or surety insurance business and
five years after they are earned on casualty business and not until the profits
have been verified pursuant to ORS 744.313.
     (j) That a managing general agent shall
not do any of the following:
     (A) Bind reinsurance or retrocessions on
behalf of the insurer, except that the managing general agent may bind facultative
reinsurance contracts pursuant to obligatory facultative agreements if the
contract with the insurer contains reinsurance underwriting guidelines that
include, for both reinsurance assumed and ceded, a list of reinsurers with
which the automatic agreements are in effect, the coverage and amounts or
percentages that may be reinsured and commission schedules.
     (B) Commit the insurer to participate in
insurance or reinsurance syndicates.
     (C) Appoint any insurance producer without
assuring that the insurance producer is licensed in this state to transact the
type of insurance for which the insurance producer is appointed.
     (D) Collect any payment from a reinsurer
or commit the insurer to any claim settlement with a reinsurer without prior
approval of the insurer. The contract must also provide that if prior approval
is given, the managing general agent must forward a report to the insurer
promptly.
     (E) Appoint a submanaging general agent.
     (k) Provisions establishing which
disputes, if any, arising under the contract shall be decided by arbitration,
mediation or other means of dispute resolution.
     (L) If the managing general agent will
calculate the loss reserves or a portion thereof, provisions:
     (A) That the insurer is ultimately
responsible for reporting the loss reserves; and
     (B) That the insurer shall annually obtain
the opinion of an actuary attesting to the adequacy of loss reserves calculated
for losses incurred and outstanding on business produced by the managing
general agent, in addition to any other required loss reserve actuarial
opinion, as provided in ORS 744.313.
     (4) In addition to the requirements of
subsection (3) of this section, if the contract permits the managing general
agent to settle claims on behalf of the insurer, the contract must also include
at least the following provisions:
     (a) The time requirements within which the
managing general agent must report claims to the insurer.
     (b) A requirement that the managing
general agent must send a copy of the claim file or report of claim to the
insurer at its request or as soon as it becomes known to the managing general
agent that the claim:
     (A) Has the potential of exceeding an
amount determined by the Director of the Department of Consumer and Business
Services or the limit set by the insurer, whichever is less;
     (B) Involves a coverage dispute;
     (C) May exceed the claim settlement
authority of the managing general agent; or
     (D) Is of a serious nature as
predetermined by the insurer by written guidelines.
     (c) A provision establishing the
settlement authority granted the managing general agent for claims in general
and specific guidelines for handling claims that exceed the amount established
by the director or the insurer, whichever is less.
     (d) A provision that all claim files are
the joint property of the insurer and managing general agent, except upon an
order of liquidation of the insurer, and that in the event of such an order:
     (A) The files become the sole property of
the insurer or its estate; and
     (B) The managing general agent shall have
reasonable access to and the right to copy the files on a timely basis.
     (e) A provision that the insurer may
terminate for cause any settlement authority granted to the managing general
agent upon written notice by the insurer to the managing general agent or upon
the termination of the contract, and that the insurer may suspend the
settlement authority during the pendency of any dispute regarding the cause for
termination.
     (5) The contract must provide that the
insurer may not allow the managing general agent to pay or commit the insurer
to pay a claim in excess of a specified amount, net of reinsurance, without
approval by the insurer. The amount shall not exceed the amount established in
ORS 744.308. [1991 c.495 §5; 2003 c.364 §120]
     744.308
Limitations on authority of insurer and managing general agent. (1) An insurer shall not allow a managing
general agent, without prior approval of the insurer, to pay or commit the
insurer to pay a claim over the amount, net of reinsurance, specified in the
contract under ORS 744.306. The amount established in the contract shall not
exceed one percent of the insurerÂ’s policyholder surplus as of December 31 of
the last completed calendar year.
     (2) Neither an insurer nor a managing
general agent may allow a subagent of the managing general agent to serve on
the board of directors of the insurer.
     (3) An insurer and a managing general
agent may not jointly employ any individual. [1991 c.495 §6]
     744.310 [Repealed by 1967 c.359 §704]
     744.311
Books, bank accounts and records. A managing general agent shall maintain all of its books, bank
accounts and records in a form usable by the Director of the Department of
Consumer and Business Services. The managing general agent shall allow the
director access to all of its books, bank accounts and records. [1991 c.495 §7]
     744.313
Financial examination; loss reserves; notification of appointment and
termination; acts of managing general agent attributed to insurer. (1) An insurer shall have on file an
independently performed financial examination of each managing general agent
with which it has done business, in a form prescribed by the Director of the
Department of Consumer and Business Services.
     (2) An insurer is ultimately responsible
for reporting the loss reserves. If a managing general agent calculates the
loss reserves or a portion thereof, the insurer shall annually obtain the
opinion of an actuary attesting to the adequacy of loss reserves calculated for
losses incurred and outstanding on business produced by the managing general
agent. The requirement under this subsection is in addition to any other
required loss reserve actuarial opinion. The actuary must be a member in good
standing of an association of actuaries determined by the director to have established
adequate professional standards for membership.
     (3) Periodically, but not less frequently
than annually, an insurer shall conduct an on-site review of the underwriting
and claims processing operations of the managing general agent.
     (4) Binding authority for all reinsurance
contracts or participation in insurance or reinsurance syndicates shall rest
with an officer of the insurer. The officer must not be affiliated with the
managing general agent.
     (5) Not later than the 30th day after
entering into a contract with a managing general agent, and not later than the
30th day after terminating such a contract, an insurer shall provide written
notification of the appointment or termination to the director. A notice of
appointment shall include any information required by the director.
     (6) An insurer shall review its books and
records each calendar quarter to determine if any insurance producer who
previously had not produced and underwritten sufficient gross direct written
premium to meet the description of a managing general agent in ORS 744.300 has
become a managing general agent subject to ORS 744.300 to 744.316. When an
insurer determines that an insurance producer has become a managing general
agent:
     (a) The insurer shall promptly notify the
insurance producer and the director of its determination.
     (b) The insurer and insurance producer
must fully comply with ORS 744.300 to 744.316 not later than the 60th day after
the date of notification under paragraph (a) of this subsection.
     (7) An insurer shall not appoint to its
board of directors an officer, director, employee, subproducer or controlling
shareholder of any of its managing general agents. This subsection does not
apply to relationships governed by ORS 732.517 to 732.592.
     (8) The acts of a managing general agent
shall be regarded as the acts of the insurer on whose behalf the managing
general agent is acting. The director may examine a managing general agent as
if it were the insurer. [1991 c.495 §§8,9; 2003 c.364 §121]
     744.314
Rules. The Director of the
Department of Consumer and Business Services may adopt rules to carry out ORS
744.300 to 744.316. [1991 c.495 §10]
     744.315 [Formerly 750.020; 1981 c.455 §1; repealed
by 1987 c.774 §154]
     744.316
Authority of director if managing general agent violates provisions of ORS
744.300 to 744.316. If the
Director of the Department of Consumer and Business Services finds that a
managing general agent has violated any provision of ORS 744.300 to 744.316,
the director may order the managing general agent to reimburse the insurer or
the rehabilitator or liquidator of the insurer for losses incurred by the
insurer because of the violation. The director may take action under this
section in addition to or instead of any other action the director may take under
the Insurance Code. [1993 c.447 §63c]
LIFE
SETTLEMENT CONTRACTS
     744.319
Definitions. As used in ORS
744.319 to 744.358:
     (1) “Licensee” means either a life
settlement provider or life settlement broker.
     (2) “Life settlement broker” means a
person who, for another person and for a fee, commission or other
consideration:
     (a) Offers or advertises the availability
of life settlement contracts; or
     (b) Introduces holders of life insurance
policies or certificates insuring the lives of persons with a terminal illness
or condition to life settlement providers or offers or attempts to negotiate
life settlement contracts between such policyholders or certificate holders and
one or more life settlement providers.
     (3) “Life settlement contract” means an
agreement between a life settlement provider and the holder of a group or
individual life insurance policy insuring the life of a person with a terminal
illness or condition, or between a life settlement provider and the certificate
holder of such a policy, in which:
     (a) The terms establish that the life
settlement provider pays something of value in return for the policyholderÂ’s or
certificate holderÂ’s assignment, transfer, sale, devise or bequest of the death
benefit or ownership of the insurance policy or certificate to the life
settlement provider; and
     (b) The policyholder or certificate holder
holds an irrevocable right under the policy or certificate to name the
beneficiary.
     (4) “Life settlement provider” means a
person who solicits, enters or negotiates life settlement contracts or offers
to enter or negotiate life settlement contracts. [1995 c.342 §2]
     744.320 [Amended by 1959 c.369 §5; repealed by 1967
c.359 §704]
     744.321
Life settlement providers.
(1) A person shall not act as a life settlement provider unless the person
holds a license of life settlement provider issued by the Director of the
Department of Consumer and Business Services.
     (2) The term “life settlement provider”
does not apply to any of the following:
     (a) Any bank, savings bank, savings and
loan association, credit union or other licensed lending institution that takes
an assignment of a life insurance policy as collateral for a loan. The
exemption in this paragraph applies only with respect to such an assignment.
     (b) An insurer issuing a life insurance
policy providing accelerated benefits pursuant to ORS 743.154 or pursuant to
the laws of the state to which the policy was subject when issued. The
exemption in this paragraph applies only with respect to the relationship
between the insurer and insured under such a policy.
     (c) Any individual who enters into not
more than one agreement in a calendar year for the transfer of life insurance
policies for any value less than the expected death benefit.
     (3) A life settlement provider may use the
term “viatical settlement provider” to describe the business transacted under
the license and may use the term “viatical settlement contract” instead of “life
settlement contract.” [1995 c.342 §3]
     744.323
Life settlement brokers. (1)
A person shall not act as a life settlement broker unless the person holds a
license of life settlement broker issued by the Director of the Department of
Consumer and Business Services.
     (2) The term “life settlement broker” does
not apply to an attorney, accountant or financial planner retained to represent
the policyholder or certificate holder unless compensation paid to the
attorney, accountant or financial planner is paid by the life settlement
provider.
     (3) A life settlement broker may use the
term “viatical settlement broker” to describe the business transacted under the
license and may use the term “viatical settlement contract” instead of “life
settlement contract.” [1995 c.342 §4]
     744.325 [1967 c.359 §550; repealed by 1987 c.774 §154]
     744.326
License application; fee.
(1) In order to obtain a license to transact business as a life settlement
provider or as a life settlement broker, an applicant shall apply for the
license on a form prescribed by the Director of the Department of Consumer and
Business Services, with payment of any fee required for the application.
     (2) The director may request biographical,
organizational, locational, financial, employment and any other information on
the application form that the director determines to be relevant to the
evaluation of applications and to the granting of the license. The director may
also require a statement of the business plan or plan of operation of the
applicant. The director may also require an applicant for a life settlement
provider license to file with the application a copy of the life settlement
contract that the applicant intends to use in business under the license.
     (3) If an applicant is a corporation, the
corporation must be incorporated under the laws of this state or must be a
foreign corporation authorized to transact business in this state. [1995 c.342 §5]
     744.328
Issuance of license. (1) If
the Director of the Department of Consumer and Business Services determines
that an applicant has satisfied all requirements for the license for which
application is made, the director shall issue the license to the applicant. The
director may issue a license if the director determines that the applicant, as
required to be set forth in the application for the license:
     (a) Has not engaged in conduct that would
authorize the director to refuse to issue a license under ORS 744.338; and
     (b) Is financially responsible and has a
good business reputation.
     (2) The director may refuse to issue a
license in the name of any firm, partnership or corporation if the director is
not satisfied that any officer, employee, stockholder or partner thereof who
may materially influence the conduct of the applicant meets the standards of
this section.
     (3) The director may issue a license to a
nonresident applicant only if the nonresident applicant files with the director
in writing an appointment of the director to be the attorney of the applicant
upon whom all legal process in any action or proceeding against the applicant
may be served. In the appointment, the applicant shall agree that any lawful
process against the applicant that is served upon the director shall be of the
same legal force and validity as if served upon the applicant, and that the
authority shall continue in force so long as any liability remains outstanding
in this state. An appointment under this subsection becomes effective on the
date that the director issues the license to the applicant.
     (4) If the director denies an application,
the director shall so inform the applicant, stating the grounds for the denial.
[1995 c.342 §6]
     744.330 [Repealed by 1967 c.359 §704]
     744.331
Expiration of license; rules for renewal. (1) A license issued under ORS 744.328 expires on its expiration date
unless it is renewed on or before its expiration date.
     (2) Unless the Director of the Department
of Consumer and Business Services designates another date, a license expires on
the last day of the month in which the second anniversary of the initial
issuance date of the license occurs, and on the second anniversary following
each renewal.
     (3) The director by rule may establish
requirements for renewing licenses. [1995 c.342 §7]
     744.333
Individual acting as provider under license of firm or corporation. An individual may act as a life settlement
provider under the authority of the license of a firm or corporate life
settlement provider, whether or not the individual holds a license as a life
settlement provider, if:
     (1) The individual is a member or employee
of the firm or is an employee, officer or director of the corporation; and
     (2) The individual is designated by the
firm or corporation on its license application or on an amendatory or
supplementary form thereto as authorized to act as a life settlement provider
under the authority of the license. [1995 c.342 §8]
     744.335 [1967 c.359 §551; 1981 c.455 §2; repealed by
1987 c.774 §154]
     744.336
Notification by licensee of material change affecting qualification for
license. A licensee shall
immediately notify the Director of the Department of Consumer and Business Services
of any material change in ownership or control or in any other matter affecting
the qualification of the licensee for the license in this state. [1995 c.342 §9]
     744.338
Suspension, revocation, refusal to issue or renew license. (1) The Director of the Department of
Consumer and Business Services may suspend, revoke, refuse to issue or refuse
to renew a license of a licensee if the director finds one or more of the
following with respect to the licensee or applicant for a license:
     (a) Dishonesty, fraud or gross negligence
in the conduct of business as a licensee, or the licensee or applicant is
otherwise shown to be untrustworthy or incompetent to act as a licensee.
     (b) The life settlement provider
demonstrates a pattern of unreasonable payments to policyholders or certificate
holders.
     (c) Falsification by the applicant or
licensee of an application for the license or renewal thereof, or
misrepresentation or engagement in any other dishonest act in relation to the
application.
     (d) Conduct resulting in a conviction of a
felony under the laws of any state or of the
     (e) Conviction of any crime, an essential
element of which is dishonesty or fraud, under the laws of any state or of the
     (f) Refusal to renew or cancellation,
revocation or suspension of authority to transact insurance or business as a
life settlement provider, life settlement broker or similar entity in another
state.
     (g) Failure to pay a civil penalty imposed
by final order of the director or to carry out terms of probation set by the
director.
     (h) Refusal by a licensee to be examined
or to produce accounts, records or files for examination, refusal by any
officers to give information with respect to the affairs of the licensee or
refusal to perform any other legal obligation as to the examination when
required by the director.
     (i) Affiliation with or under the same
general management or interlocking directorate or ownership as another life
settlement provider or life settlement broker or an insurer, any of which
unlawfully transacts business in this state.
     (j) Failure at any time to meet any
qualification for which issuance of the license could have been refused had the
failure then existed and been known to the director.
     (k) Violation of any rule or order of the
director or any provision of the Insurance Code.
     (2) The director may suspend or refuse to
renew a license immediately and without hearing if the director determines that
one or both of the following circumstances exist:
     (a) The licensee is insolvent.
     (b) The financial condition or business
practices of the licensee otherwise pose an imminent threat to the public
health, safety or welfare of the residents of this state.
     (3) A life settlement provider or life
settlement broker holding a license that has not been renewed or has been
revoked shall surrender the license to the director at the directorÂ’s request.
     (4) The director may take any other
administrative action authorized under the Insurance Code in addition to or in
lieu of the actions authorized under this section. [1995 c.342 §10]
     744.340 [Repealed by 1967 c.359 §704]
     744.341
Terms of contract. (1) A
life settlement contract must be in writing. A life settlement provider shall
establish in the contract the terms under which the life settlement provider
will pay compensation or anything of value in return for the policyholderÂ’s or
certificate holderÂ’s assignment, transfer, sale, devise or bequest of the death
benefit or ownership of the insurance policy or certificate to the life
settlement provider.
     (2) A life settlement provider shall not
use a life settlement contract in this state unless the life settlement
provider has filed the contract form with the Director of the Department of
Consumer and Business Services and the director has approved the contract form.
The director shall disapprove a life settlement contract form if, in the
directorÂ’s opinion, the contract or any provision of the contract is
unreasonable, contrary to the interests of the public, or otherwise misleading
or unfair to the policyholder or certificate holder.
     (3) Each life settlement contract entered
into in this state must contain a provision enabling the policyholder or
certificate holder to rescind the contract not later than the 30th day after
the date on which the contract is executed by all parties or not later than the
15th day after the policyholder or certificate holder receives the life
settlement proceeds, whichever is the lesser period. In order to rescind such a
contract, a policyholder or certificate holder who has received the proceeds
must return them to the life settlement provider. [1995 c.342 §11]
     744.343
Annual report by provider.
Each life settlement provider shall file a report for the preceding calendar
year with the Director of the Department of Consumer and Business Services on
or before March 1 of each year, or within such extension of time therefor as
the director may grant. The report shall be in the form and contain such
information as the director prescribes and shall be verified as follows:
     (1) If the life settlement provider is a
corporation, by at least two principal officers of the life settlement
provider.
     (2) If the life settlement provider is a
partnership, by two partners.
     (3) If the life settlement provider is
neither a corporation nor a partnership, by its president and secretary. [1995
c.342 §12]
     744.345 [Formerly 750.040; repealed by 1987 c.774 §154]
     744.346
Examination of business and practices of licensee or applicant; records. (1) The Director of the Department of
Consumer and Business Services may examine the business and practices of any
licensee or applicant for a license when the director determines an examination
to be necessary. The director may order a licensee or applicant to produce any
records, books, files or other information reasonably necessary to ascertain
whether or not the licensee or applicant is acting or has acted in violation of
the law or otherwise contrary to the interests of the public. The expenses
incurred in conducting any examination shall be paid by the licensee or
applicant.
     (2) A life settlement provider shall
maintain records of all transactions of life settlement contracts of the life
settlement provider and must make the records available to the director for
inspection during reasonable business hours. The records must be maintained for
a period of not later than five years from the date of their creation.
     (3) The director at any time may require a
licensee to fully disclose the identity of all stockholders, partners, officers
and employees.
     (4) Names of, and individual
identification data for, all policyholders and certificate holders who have
entered life settlement contracts with life settlement providers shall be
confidential as provided in ORS 705.137. [1995 c.342 §13; 2001 c.377 §15]
     744.348
Disclosure of information to policyholder. A life settlement provider shall disclose the information specified in
this section to the policyholder or certificate holder entering the life
settlement contract, not later than the date on which the life settlement
contract is signed by all parties. The disclosure must be in the manner
prescribed by the Director of the Department of Consumer and Business Services.
The information must include the following:
     (1) Possible alternatives to life
settlement contracts for persons with terminal illnesses or conditions,
including but not limited to accelerated benefits offered by the issuer of the
life insurance policy.
     (2) The fact that some or all of the
proceeds of the life settlement may be taxable, and that assistance should be
sought from a personal tax advisor.
     (3) The fact that the life settlement
could be subject to the claims of creditors.
     (4) The fact that receipt of a life
settlement may adversely affect the recipientÂ’s eligibility for Medicaid or
other government benefits or entitlements, and that advice should be obtained
from the appropriate agencies.
     (5) The right of a policyholder or
certificate holder to rescind a life settlement contract as provided in ORS
744.341. The disclosure shall state the deadlines for rescission and return of
proceeds received.
     (6) The date by which the funds will be
available to the policyholder or certificate holder and the source of the funds.
[1995 c.342 §14]
     744.350 [Repealed by 1967 c.359 §704]
     744.351
Conditions precedent to entering into life settlement contract. (1) Before a life settlement provider enters
into a life settlement contract with a policyholder or certificate holder who
has a terminal illness or condition, the life settlement provider shall first
obtain both of the following:
     (a) A written statement from an attending
physician that the policyholder or certificate holder is of sound mind and
under no constraint or undue influence.
     (b) A witnessed document in which the
policyholder or certificate holder consents to the life settlement contract,
acknowledges the illness or condition is terminal, represents that the
policyholder or certificate holder has a full and complete understanding of the
life settlement contract, that the policyholder or certificate holder has a
full and complete understanding of the benefits of the life insurance policy,
releases the medical records of the policyholder or certificate holder relating
to the terminal illness or condition and acknowledges that the policyholder or
certificate holder has entered into the life settlement contract freely and
voluntarily.
     (2) A life settlement provider may enter a
life settlement contract only after the individual whose life would be the
subject of the life settlement contract is determined to have a terminal
illness or condition, as follows:
     (a) If the individual is the policyholder
or certificate holder, an attending physician of the policyholder or certificate
holder must make the determination.
     (b) If the individual is a person other
than the policyholder or certificate holder, an attending physician of the
individual or of the policyholder or certificate holder must make the
determination.
     (3) For the purposes of this section, an
attending physician is a medical doctor, doctor of osteopathy or naturopathic
physician licensed in this state, who is primarily responsible for the
treatment or a portion of treatment of the individual whose life would be the
subject of the life settlement contract. [1995 c.342 §15]
     744.353
Prohibitions on finderÂ’s fee, solicitations, discrimination. (1) A licensee shall not pay or offer to pay
a finderÂ’s fee, commission or other compensation to a person described in this subsection,
in connection with a policy insuring the life of an individual with a terminal
illness or condition. The prohibition under this subsection applies with
respect to payments or offers of payment to:
     (a) The physician, attorney or accountant
of the policyholder, of the certificate holder or of the insured individual
when the individual is other than the policyholder or certificate holder.
     (b) Any person other than a physician,
attorney or accountant described in paragraph (a) of this subsection, who
provides medical, legal or financial planning services to the policyholder, to
the certificate holder or to the insured individual when the individual is
other than the policyholder or certificate holder.
     (c) Any person other than one described in
paragraph (a) or (b) of this subsection who acts as an agent of the
policyholder, certificate holder or insured individual.
     (2) A licensee shall not solicit an
investor who could influence the treatment of the illness or condition of the
individual whose life would be the subject of a life settlement contract.
     (3) All information solicited or obtained
from a policyholder or certificate holder by a licensee shall be subject to ORS
746.600 to 746.690. For purposes of this subsection, a licensee shall be considered
an insurance-support organization within the meaning of ORS 746.600.
     (4) A licensee shall not discriminate in
the making of a life settlement contract on the basis of race, age, sex,
national origin, creed, religion, occupation, marital or family status, sexual
orientation, or discriminate between persons who have dependents and persons
who do not have dependents. [1995 c.342 §16]
     Note: The amendments to 744.353 by section 31,
chapter 100, Oregon Laws 2007, are the subject of a referendum petition that
may be filed with the Secretary of State not later than September 26, 2007. If
the referendum petition is filed with the required number of signatures of
electors, chapter 100, Oregon Laws 2007, will be submitted to the people for
their approval or rejection at the regular general election held on November 4,
2008. If approved by the people at the general election, chapter 100, Oregon
Laws 2007, takes effect December 4, 2008. If the referendum petition is not
filed with the Secretary of State or does not contain the required number of
signatures of electors, the amendments to 744.353 by section 31, chapter 100,
Oregon Laws 2007, take effect January 1, 2008. 744.353, as amended by section
31, chapter 100, Oregon Laws 2007, is set forth for the userÂ’s convenience.
     744.353. (1) A licensee may not pay or offer to pay a
finderÂ’s fee, commission or other compensation to a person described in this
subsection, in connection with a policy insuring the life of an individual with
a terminal illness or condition. The prohibition under this subsection applies
with respect to payments or offers of payment to:
     (a) The physician, attorney or accountant
of the policyholder, of the certificate holder or of the insured individual
when the individual is other than the policyholder or certificate holder.
     (b) Any person other than a physician,
attorney or accountant described in paragraph (a) of this subsection, who
provides medical, legal or financial planning services to the policyholder, to
the certificate holder or to the insured individual when the individual is
other than the policyholder or certificate holder.
     (c) Any person other than one described in
paragraph (a) or (b) of this subsection who acts as an agent of the
policyholder, certificate holder or insured individual.
     (2) A licensee may not solicit an investor
who could influence the treatment of the illness or condition of the individual
whose life would be the subject of a life settlement contract.
     (3) All information solicited or obtained
from a policyholder or certificate holder by a licensee is subject to ORS
746.600 to 746.690. For purposes of this subsection, a licensee is considered
an insurance-support organization within the meaning of ORS 746.600.
     (4) A licensee may not discriminate in the
making of a life settlement contract on the basis of race, religion, creed,
sex, sexual orientation, national origin, marital status, age, familial status
or occupation or discriminate between persons who have dependents and persons
who do not have dependents.
     744.355 [Formerly 750.050; repealed by 1987 c.774 §154]
     744.356
Payment to escrow or trust account; lump sum payment. (1) Immediately upon receipt of documents
from the policyholder or certificate holder effecting the transfer of the
insurance policy or certificate, the life settlement provider shall pay the
proceeds of the settlement to an escrow or trust account managed by a trustee
or escrow agent in a bank approved by the Director of the Department of
Consumer and Business Services, pending acknowledgment of the transfer by the
issuer of the life insurance policy. The trustee or escrow agent shall be
required to transfer the proceeds due to the policyholder or certificate holder
immediately upon receipt of acknowledgment of the transfer from the insurer.
     (2) A life settlement provider shall make
payment of the proceeds of a life settlement contract in a lump sum, except as
provided in this subsection. A life settlement provider shall not retain any
portion of the proceeds. A life settlement provider may make installment
payments only if the life settlement provider has purchased an annuity issued
by an authorized insurer or a similar financial instrument issued by a
financial institution authorized to engage in the business of a financial
institution in this state.
     (3) Failure by the life settlement
provider to tender the life settlement by the date disclosed to the
policyholder or certificate holder renders the contract void. [1995 c.342 §17]
     744.358
Rules; standards; bond. The
Director of the Department of Consumer and Business Services may adopt rules
for the purpose of carrying out ORS 744.319 to 744.358. In addition:
     (1) The director may establish standards
for evaluating reasonableness of payments under life settlement contracts. The
authority includes but is not limited to regulation of discount rates used to
determine the amount paid in exchange for assignment, transfer, sale, devise or
bequest of a benefit under a life insurance policy. For the purpose of the
standards, the director shall consider payments made in regional and national
life settlement markets, to the extent such information is available, as well
as model standards developed by the National Association of Insurance
Commissioners.
     (2) The director may require a bond or an
errors and omissions insurance policy of either or both kinds of licensees.
     (3) The director may establish trade
practice standards by rule for the purpose of regulating advertising and
solicitation of life settlement contracts. [1995 c.342 §18]
     744.360 [Repealed by 1967 c.359 §704]
     744.365 [1967 c.359 §554; repealed by 1987 c.774 §154]
     744.370 [Repealed by 1967 c.359 §704]
     744.375 [Formerly 750.060; repealed by 1987 c.774 §154]
     744.380 [Repealed by 1967 c.359 §704]
     744.385 [Formerly 750.100; repealed by 1987 c.774 §154]
     744.390 [Repealed by 1967 c.359 §704]
     744.395 [Repealed by 1967 c.359 §704]
     744.396 [Formerly 750.080; repealed by 1987 c.774 §154]
     744.400 [Repealed by 1967 c.359 §704]
     744.405 [Formerly 750.090; 1979 c.870 §7; repealed
by 1987 c.774 §154]
     744.410 [Amended by 1963 c.463 §1; repealed by 1967
c.359 §704]
     744.420 [Amended by 1953 c.322 §2; 1963 c.463 §2;
repealed by 1967 c.359 §704]
     744.430 [Amended by 1955 c.226 §2; 1963 c.463 §3;
1967 c.359 §503; renumbered 743.672]
     744.440 [Amended by 1967 c.359 §504; renumbered
743.675]
     744.450 [Amended by 1967 c.359 §505; renumbered
743.678]
     744.460 [Amended by 1967 c.359 §506; renumbered
743.681]
     744.470 [Repealed by 1967 c.359 §704]
     744.480 [Repealed by 1967 c.359 §704]
     744.490 [Repealed by 1967 c.359 §704]
     744.500 [Repealed by 1967 c.359 §704]
ADJUSTERS
     744.505
Adjuster license required.
(1) Except as provided in ORS 744.515, a person shall not act or attempt to act
as an adjuster of losses claimed under insurance policies, whether acting for
the insurer or the insured, unless the person holds a valid license issued by
the Director of the Department of Consumer and Business Services that
authorizes the person to act as an adjuster. A license under this section
authorizes an adjuster to adjust losses for or against authorized insurers or
insurers with which policies were placed under a surplus line insurance license
as provided in ORS 735.400 to 735.495.
     (2) A license under this section does not
authorize a person to act as an adjuster for any person other than the insurer
or insured. [Formerly 736.485; 1983 c.76 §10; 1987 c.774 §139; 1989 c.413 §14;
1989 c.701 §43; 1991 c.810 §12]
     744.510 [Repealed by 1967 c.359 §704]
     744.515
Exemptions from adjuster licensing requirement. (1) A licensed resident insurance producer
or salaried employee or officer of an authorized insurer may adjust and settle
losses for the insurer that the insurance producer, employee or officer
represents, without obtaining an adjusterÂ’s license.
     (2) A person may make one adjustment
before obtaining an adjusterÂ’s license if the person applies for the license
within two days after entering upon the adjustment, and in all other respects
complies with the provisions of this chapter governing adjusters.
     (3) A person holding a temporary permit
under ORS 744.555 may perform acts authorized under ORS 744.555 without
obtaining an adjusterÂ’s license.
     (4) Any average adjuster or adjuster of
maritime losses may adjust maritime losses without obtaining an adjusterÂ’s
license.
     (5) A person may perform or provide repair
or replacement service under home protection insurance without obtaining an
adjuster’s license. [1967 c.359 §560; 1971 c.231 §33; 1981 c.247 §19; 1983 c.76
§11; 1989 c.701 §44; 2003 c.364 §122]
     744.520 [Repealed by 1967 c.359 §704]
     744.525
Adjuster qualifications. An
applicant for a license as a resident adjuster shall apply for the license as
provided in ORS 744.001 and must meet the following requirements:
     (1) If the applicant is an individual, the
applicant must establish a residence or place of transacting insurance business
in this state prior to filing an application. If the applicant is a firm or
corporation, the applicant must establish an office in this state that employs
an individual licensed under ORS 744.002 as an adjuster.
     (2) If the applicant is an individual, the
applicant must pass any examination required by ORS 744.535.
     (3) The applicant must satisfy all other
requirements established by the Director of the Department of Consumer and
Business Services by rule. [1967 c.359 §561; 1971 c.231 §34; 1973 c.827 §81;
1983 c.76 §12; 1989 c.701 §45]
     744.528
Nonresident adjuster license.
(1) A person who resides in another state or a province of Canada and is
licensed in that state or province as an adjuster may be licensed to act as a
nonresident adjuster in this state as provided in this section if the state or
province in which the person resides gives the same privilege to a resident
adjuster of this state.
     (2) An applicant for a license to act as a
nonresident adjuster must do the following:
     (a) Apply for the license on forms
designed and furnished by the Director of the Department of Consumer and
Business Services as provided in ORS 744.001.
     (b) If the applicant is an individual,
pass an examination required by ORS 744.535. [1989 c.701 §46; 1991 c.810 §13]
     744.530 [1957 c.247 §1; repealed by 1967 c.359 §704]
     744.531
Classes of insurance for adjusters. When the Director of the Department of Consumer and Business Services
issues a license authorizing a person to act as an adjuster, the director shall
indorse on the license the class or classes of insurance described in this
section with respect to which the person is authorized to adjust losses. The
classes of insurance are as follows:
     (1) Property and casualty insurance. Under
this class, in addition to property and casualty insurance, an adjuster may
also adjust losses with respect to marine and transportation and surety
insurance.
     (2) Health insurance, whether provided by
an insurer or a health care service contractor as defined in ORS 750.005.
     (3) Any class of insurance designated by
the director by rule. [1989 c.701 §47; 2003 c.802 §170]
     Note: 744.531 was enacted into law by the
Legislative Assembly but was not added to or made a part of ORS chapter 744 or
any series therein by legislative action. See Preface to Oregon Revised
Statutes for further explanation.
     744.535
Adjuster licensing examination.
(1) The Director of the Department of Consumer and Business Services shall give
an examination to each individual applicant for a license as an adjuster. The
examination must test the qualifications and competence of the applicant and
the knowledge of the applicant with respect to the classes of insurance that
may be dealt with under the license and with respect to the duties and
responsibilities of an adjuster under the laws of this state.
     (2) The requirement of an examination
under subsection (1) of this section shall not apply to an applicant who is
licensed as an independent adjuster in another state that licenses adjusters of
this state without examination.
     (3) The director shall give examinations
at such times and places within the state as the director deems necessary to
reasonably serve the best interests of all concerned, provided that the
director shall give an examination at least once every six months if
applications for licenses are then pending. [1967 c.359 §562; 1989 c.413 §15;
1989 c.701 §48; 1991 c.810 §14]
     744.538
Change of circumstance of nonresident adjuster. (1) A nonresident adjuster shall not act as
an adjuster in this state when the adjuster no longer holds a valid license as
an adjuster in the state or province in which the adjuster resides. If the
license of the adjuster in the state in which the adjuster resides is
reinstated, and if the nonresident adjusterÂ’s license has not expired, the
adjuster may apply to the Director of the Department of Consumer and Business
Services for reinstatement of the nonresident license.
     (2) A nonresident adjuster who establishes
residence in this state shall not transact business as an adjuster in this
state under the nonresident license following the 30th day after the adjuster
establishes the residence. An adjuster under this subsection may thereafter act
as an adjuster in this state only under a license to act as a resident
adjuster.
     (3) A nonresident adjuster who changes
residence to another state other than this state or to a province must apply to
the director for a license as a nonresident adjuster as if the adjuster were
initially applying for such a license. [1989 c.701 §49; 1995 c.639 §6]
     744.540 [1957 c.247 §2; repealed by 1967 c.359 §704]
     744.541
Adjustment of claim under policy issued by unauthorized insurer. An adjuster may adjust a loss claimed under
an insurance policy issued by an unauthorized insurer other than a surplus line
insurer. The adjuster shall notify the Director of the Department of Consumer
and Business Services thereof not later than the 20th day after adjusting the
loss. [1989 c.701 §50]
     744.545 [1967 c.359 §563; 1983 c.76 §13; 1989 c.413 §16;
repealed by 1989 c.701 §81]
     744.550 [1957 c.247 §3; repealed by 1967 c.359 §704]
     744.555
Temporary adjuster permit.
(1) To facilitate the settlement of claims under insurance policies when there
is widespread property loss in this state arising out of a catastrophe, the
Director of the Department of Consumer and Business Services may issue a
temporary permit to any person authorized in another state to adjust losses
claimed under insurance policies to act as an adjuster in the catastrophe area
for or against an authorized insurer. A temporary permit issued pursuant to
this section shall be effective for such time as the director determines
necessary and shall be in lieu of the license and fee requirements otherwise
applicable.
     (2) A temporary permit may be obtained by
filing with the director a written application therefor in the form prescribed
by the director. The application shall contain the name and address of the
applicant, the name of the state in which the applicant is authorized to adjust
losses claimed under insurance policies and any other information the director
may require.
     (3) Such a permit may also be issued in
respect to any adjuster who is licensed or permitted to act as such in the
state of domicile of the adjuster and who is sent into this state on behalf of
an authorized insurer or insured for the purpose of investigating or making
adjustment of a particular loss under policies of insurance. [Formerly 736.490;
1989 c.701 §51]
     744.560 [1957 c.247 §4; repealed by 1967 c.359 §704]
     744.565 [1957 c.247 §5; repealed by 1967 c.359 §704]
     744.566 [1967 c.359 §565; repealed by 1969 c.336 §21]
     744.570 [1957 c.247 §6; repealed by 1967 c.359 §704]
     744.575
Adjusting claims involving credit life or credit health insurance. No plan or arrangement shall be used with
respect to credit life or credit health insurance whereby any person other than
the insurer or its designated claim representative shall be authorized to
settle or adjust claims. The creditor shall not be designated as claim
representative for the insurer in adjusting claims, except that a group
policyholder may, by arrangement with the group insurer, draw drafts or checks
in payment of claims due to the group policyholder subject to audit and review
by the insurer. [Formerly 741.455; 1989 c.701 §52]
     744.580 [1957 c.247 §7; repealed by 1967 c.359 §704]
     744.590 [1957 c.247 §8; repealed by 1967 c.359 §704]
     744.600 [1957 c.247 §9; repealed by 1967 c.359 §704]
INSURANCE
CONSULTANTS
     744.605
Insurance consultantÂ’s license required. (1) A person shall not act as an insurance consultant unless the
person holds a valid license issued by the Director of the Department of
Consumer and Business Services that authorizes the person to act as an
insurance consultant. For purposes of this section, a person acts as an
insurance consultant if:
     (a) The person purports or offers to
engage in any of the activities described in paragraph (b) of this subsection
by using, in conjunction with the personÂ’s name, the title or designation of
insurance planner, consultant, adviser or counselor, or financial and insurance
planner, consultant, adviser or counselor, or any similar title or designation;
or
     (b) The person, for compensation other than
commission from the sale of insurance, engages, attempts to engage or offers to
engage in any of the following activities:
     (A) Acting as a consultant regarding
insurance.
     (B) Giving advice, counsel, opinion or
service with respect to the benefits, advantages or disadvantages of insurance
that may be issued in this state.
     (C) In any other manner providing
information about insurance.
     (2) For the purposes of subsection (1)(b)
of this section, compensation includes consideration paid for financial and other
related services provided by the person in connection with services referred to
in subsection (1)(b) of this section. [1985 c.697 §2; 1989 c.701 §53; 1991
c.810 §15; 1997 c.419 §1]
     744.609
Exemptions. The following
persons are not insurance consultants for the purposes of this chapter, and the
prohibition in ORS 744.605 does not apply to them:
     (1) Any attorney-at-law rendering services
in the performance of duties of an attorney-at-law.
     (2) Any certified public accountant or
public accountant rendering services in the performance of the duties of a
certified public accountant or public accountant, as authorized by law.
     (3) Any person who, while conducting an
educational seminar, performs any of the activities described in ORS 744.605
(1)(b).
     (4) Any financial institution, as defined
in ORS 706.008, or consumer finance licensee under ORS chapter 725.
     (5) Any actuary who is a member of an
organization determined by the Director of the Department of Consumer and
Business Services as establishing standards for the actuarial profession.
     (6) A person who provides or offers or
purports to provide any of the services described in ORS 744.605 only to an
insurance producer or an authorized insurer. [1985 c.697 §3; 1989 c.701 §54;
1991 c.810 §16; 1997 c.419 §2; 1999 c.59 §228; 2003 c.364 §123]
     744.610 [1957 c.247 §10; repealed by 1967 c.359 §704]
     744.615 [1985 c.697 §4; repealed by 1989 c.701 §81]
     744.619
Qualifications for resident insurance consultantÂ’s license; rules. An applicant for a license as a resident
insurance consultant shall apply for the license as provided in ORS 744.001 and
must meet the following requirements:
     (1) The applicant must provide
satisfactory evidence to the Director of the Department of Consumer and
Business Services that the insurance required under ORS 744.635 has been
procured and is in effect.
     (2) The applicant, if an individual, must
establish a residence or place of transacting insurance business in this state
prior to filing an application. If the application is a firm or corporation,
the applicant must establish an office in this state that is managed by an
individual licensed as an insurance consultant.
     (3) The applicant, if an individual, must
have had at least five yearsÂ’ experience in the insurance business relating to
the class or classes of insurance for which the applicant is applying to be an
insurance consultant or have equivalent educational qualifications as
prescribed by the director.
     (4) The applicant, if an individual, must
pass a written examination given by the director. The examination requirement
does not apply to an applicant who is licensed as a resident insurance producer
to transact the class or classes of insurance for which the applicant is
applying to be an insurance consultant.
     (5) The applicant must satisfy any other
requirements established by the director by rule. [1985 c.697 §5; 1989 c.701 §57;
1991 c.810 §17; 2003 c.364 §124]
     744.620 [1957 c.247 §11; repealed by 1967 c.359 §704]
     744.621
Nonresident insurance consultant license. (1) A person who resides in another state or province of Canada and is
licensed in that state or province as an insurance consultant or is registered
under a regulatory program of the other state or province similar to the
regulatory program for insurance consultants under this chapter, as determined
by the Director of the Department of Consumer and Business Services, may be
licensed to act as a nonresident insurance consultant in this state as provided
in this section if the state or province in which the person resides gives the
same privilege to a resident insurance consultant of this state.
     (2) An applicant for a license to act as a
nonresident insurance consultant shall apply for the license as provided in ORS
744.001 and must meet the following requirements:
     (a) The applicant must provide
satisfactory evidence to the director that the insurance required under ORS
744.635 has been procured and is in effect.
     (b) If the applicant is an individual, the
applicant must have had at least five yearsÂ’ experience in the insurance
business relating to the class or classes of insurance for which the applicant
is applying to be an insurance consultant or have equivalent educational
qualifications as prescribed by the director.
     (c) If the applicant is an individual, the
applicant must take and pass a written examination given by the director,
unless the state or province in which the applicant resides licenses or
registers insurance consultants of this state without examination. The
examination requirement does not apply to an applicant who is licensed as a
nonresident insurance producer to transact the class or classes of insurance
for which the applicant is applying to be an insurance consultant.
     (d) The applicant must satisfy any other
requirements established by the director by rule. [1989 c.701 §58; 1991 c.810 §18;
2003 c.364 §125]
     744.625 [1985 c.697 §6; 1987 c.774 §142; repealed by
1989 c.701 §81]
     744.626
Classes of insurance for consultants. When the Director of the Department of Consumer and Business Services
issues a license authorizing a person to act as an insurance consultant, the
director shall indorse on the license the class or classes of insurance
described in this section with respect to which the person is authorized to act
as an insurance consultant. The classes of insurance are as follows:
     (1) Life insurance.
     (2) Health insurance.
     (3) Property and casualty insurance. Under
this class, in addition to property and casualty insurance, an insurance
consultant may also act as insurance consultant with respect to marine and
transportation and surety insurance.
     (4) Any class of insurance designated by
the director by rule. [1989 c.701 §62; 2003 c.802 §171]
     Note: 744.626 was enacted into law by the
Legislative Assembly but was not added to or made a part of ORS chapter 744 or
any series therein by legislative action. See Preface to Oregon Revised
Statutes for further explanation.
     744.629 [1985 c.697 §7; repealed by 1989 c.701 §81]
     744.630 [1957 c.247 §12; repealed by 1967 c.359 §704]
     744.631
Change of circumstance of nonresident insurance consultant. (1) A nonresident insurance consultant shall
not act as an insurance consultant in this state when the insurance consultant
no longer holds a valid license as an insurance consultant in the state or province
in which the insurance consultant resides. If the license of the insurance
consultant in the state in which the insurance consultant resides is reinstated
and if the nonresident license has not expired, the insurance consultant may
apply to the Director of the Department of Consumer and Business Services for
reinstatement of the nonresident license.
     (2) A nonresident insurance consultant who
establishes residence in this state shall not transact business as an insurance
consultant in this state under the nonresident license following the 30th day
after the insurance consultant establishes the residence. An insurance
consultant under this paragraph may act as a resident insurance consultant in
this state if the insurance consultant obtains the appropriate license.
     (3) A nonresident insurance consultant who
changes residence to another state other than this state or to a province must
apply to the director for a license as a nonresident insurance consultant as if
the insurance consultant were initially applying for such a license. [1989
c.701 §61; 1995 c.639 §7]
     744.635
Errors and omissions insurance; rules. (1) An insurance consultant shall maintain with the Director of the
Department of Consumer and Business Services a current certificate of errors
and omissions insurance in an amount established by the director by rule from
an insurer authorized to do business in this state or from any other insurer
acceptable to the director according to standards established by rule.
     (2) If the director determines that errors
and omissions insurance required under this section is not generally available
at a reasonable cost, the director by rule may suspend the requirement of
insurance, but must reimpose the requirement when the insurance becomes
available once again. [1985 c.697 §8; 1989 c.701 §63; 1991 c.331 §131; 1991
c.810 §19]
     744.639 [1985 c.697 §9; repealed by 1989 c.701 §81]
     744.640 [1957 c.247 §13; repealed by 1967 c.359 §704]
     744.645 [1985 c.697 §10; repealed by 1989 c.701 §81]
     744.650
Disclosure by insurance consultants; rules. (1) An insurance consultant shall furnish to each client and
prospective client a written disclosure statement containing the following
information:
     (a) A description of the nature of the
work to be performed by the insurance consultant.
     (b) The applicable occupational and
educational background of the insurance consultant.
     (c) The area or areas of insurance in
which the insurance consultant has particular expertise.
     (d) The fee schedule and any other
expenses that the insurance consultant charges, and whether fees may be
negotiated.
     (e) The name of any person, other than
clients, that the insurance consultant represents.
     (f) Whether the insurance consultant will
receive any commission or obtain any other compensation for services provided
the client in addition to fees and other expenses paid by the client.
     (g) Any other information required by the
Director of the Department of Consumer and Business Services by rule.
     (2) An insurance consultant shall disclose
information required under this subsection to each client in the course of
providing insurance consultant services to the client and before the insurance
consultant makes any final insurance recommendation to the client. The
insurance consultant shall disclose at least the following information as
applicable to the line of insurance for which the insurance consultant is
providing services:
     (a) Other business activities of the
insurance consultant relating to financial planning.
     (b) The method of investment analysis and
comparison used.
     (c) Assumptions contributing to insurance
recommendations for the client.
     (d) Any other information required by the
director by rule.
     (3) The director may establish additional
disclosure requirements for licensees who are licensed both as insurance
producers and insurance consultants.
     (4) The director may design the form of
disclosure statement to be used under subsection (1) of this section. [1985
c.697 §11; 1991 c.810 §20; 2003 c.364 §126]
     744.655
Rebates prohibited. An insurance
consultant may not give or receive or offer to give or receive a rebate of all
or a part of any fee or other expenses charged for services or any earnings,
profit, dividends or other benefit accruing to the insurance consultant from
the services provided by the insurance consultant. [1985 c.697 §12; 1991 c.810 §23]
     744.660 [1985 c.697 §13; repealed by 1989 c.701 §81]
     744.665
Continuing education; rules.
The Director of the Department of Consumer and Business Services by rule may
establish requirements for continuing education that each insurance consultant
must satisfy as a condition for continuation of the license. [1985 c.697 §14]
THIRD PARTY
ADMINISTRATORS
     744.700
Definitions for ORS 744.700 to 744.740. As used in ORS 744.700 to 744.740:
     (1) “Affiliate” of, or person “affiliated”
with, a specific person means any person who directly or indirectly through one
or more intermediaries, controls or is controlled by, or is under common
control with, a specified person.
     (2) “Control” has the meaning given that
term in ORS 732.548.
     (3) “Insurer” includes a health care
service contractor, a multiple employer welfare arrangement or any other person
providing a plan of insurance subject to state insurance regulation. “Insurer”
does not include a bona fide employee benefit plan established by an employer
or an employee organization, or both, for which the insurance laws of this
state are preempted pursuant to the Employee Retirement Income Security Act of
1974.
     (4) “Underwrite” or “underwriting” includes
the acceptance of employer or individual applications for coverage of
individuals in accordance with the written rules of the insurer, the overall
planning and coordinating of an insurance program and the ability to procure
bonds and excess insurance. [1991 c.812 §2]
     744.702
Third party administrator license; description of transacting business as third
party administrator. (1)
Subject to ORS 744.704, a person shall not transact business or purport or
offer to transact business as a third party administrator in this state unless
the person holds a third party administrator license issued by the Director of
the Department of Consumer and Business Services.
     (2) For purposes of ORS 744.700 to
744.740, a person transacts or purports or offers to transact business as a
third party administrator when the person directly or indirectly solicits or
effects coverage of, underwrites, collects charges or premiums from, or adjusts
or settles claims on, residents of this state or residents of another state
from offices in this state, in connection with life insurance or health
insurance coverage.
     (3) Nothing in ORS 744.700 to 744.740
exempts a third party administrator from any other applicable licensing
requirement when the third party administrator performs the functions of an
insurance producer, adjuster or insurance consultant. [1991 c.812 §3; 2003
c.364 §127]
     744.704
Exemptions from license requirement; rules. (1) The following persons are exempt from the licensing requirement
for third party administrators in ORS 744.702 and from all other provisions of
ORS 744.700 to 744.740 applicable to third party administrators:
     (a) A person licensed under ORS 744.002 as
an adjuster, whose activities are limited to adjustment of claims and whose
activities do not include the activities of a third party administrator.
     (b) A person licensed as an insurance
producer as required by ORS 744.053 and authorized to transact life or health
insurance in this state, whose activities are limited exclusively to the sale
of insurance and whose activities do not include the activities of a third
party administrator.
     (c) An employer acting as a third party
administrator on behalf of:
     (A) Its employees;
     (B) The employees of one or more
subsidiary or affiliated corporations of the employer; or
     (C) The employees of one or more persons
with a dealership, franchise, distributorship or other similar arrangement with
the employers.
     (d) A union, or an affiliate thereof,
acting as a third party administrator on behalf of its members.
     (e) An insurer that is authorized to
transact insurance in this state with respect to a policy issued and delivered
in and pursuant to the laws of this state or another state.
     (f) A creditor acting on behalf of its
debtors with respect to insurance covering a debt between the creditor and its
debtors.
     (g) A trust and the trustees, agents and
employees of the trust, when acting pursuant to the trust, if the trust is
established in conformity with 29 U.S.C. 186.
     (h) A trust exempt from taxation under
section 501(a) of the Internal Revenue Code, its trustees and employees acting
pursuant to the trust, or a voluntary employees beneficiary association
described in section 501(c) of the Internal Revenue Code, its agents and
employees and a custodian and the custodianÂ’s agents and employees acting
pursuant to a custodian account meeting the requirements of section 401(f) of
the Internal Revenue Code.
     (i) A financial institution that is
subject to supervision or examination by federal or state financial institution
regulatory authorities, or a mortgage lender, to the extent the financial
institution or mortgage lender collects and remits premiums to licensed
insurance producers or authorized insurers in connection with loan payments.
     (j) A company that issues credit cards and
advances for and collects premiums or charges from its credit card holders who
have authorized collection. The exemption under this paragraph applies only if
the company does not adjust or settle claims.
     (k) A person who adjusts or settles claims
in the normal course of practice or employment as an attorney at law. The
exemption under this subsection applies only if the person does not collect
charges or premiums in connection with life insurance or health insurance
coverage.
     (L) A person who acts solely as an
administrator of one or more bona fide employee benefit plans established by an
employer or an employee organization, or both, for which the Insurance Code is
preempted pursuant to the Employee Retirement Income Security Act of 1974. A
person to whom this paragraph applies must comply with the requirements of ORS
744.714.
     (m) The Oregon Medical Insurance Pool
Board, established under ORS 735.600 to 735.650, and the administering insurer
or insurers for the board, for services provided pursuant to ORS 735.600 to
735.650.
     (n) An entity or association owned by or
composed of like employers who administer partially or fully self-insured plans
for employees of the employers or association members.
     (o) A trust established by a cooperative
body formed between cities, counties, districts or other political subdivisions
of this state, or between any combination of such entities, and the trustees,
agents and employees acting pursuant to the trust.
     (p) Any person designated by the Director
of the Department of Consumer and Business Services by rule.
     (2) A third party administrator is not
required to be licensed as a third party administrator in this state if the
following conditions are met:
     (a) The third party administrator has its
principal place of business in another state;
     (b) The third party administrator is not
soliciting business as a third party administrator in this state; and
     (c) In the case of any group policy or
plan of insurance serviced by the third party administrator, the lesser of five
percent or 100 certificate holders reside in this state. [1991 c.812 §4; 2001
c.191 §40; 2003 c.364 §128]
     744.706
Application for license. (1)
In order to obtain a license to transact business as a third party
administrator, an applicant shall apply for the license on a form prescribed by
the Director of the Department of Consumer and Business Services, with payment
of any fee required for the application.
     (2) The director may request biographical,
organizational, locational, financial, employment and any other information on
the application form that the director determines to be relevant to the
evaluation of applications and to the granting of the license, including
satisfactory evidence that the insurance required under ORS 744.726 has been
procured and is in effect. The director may also require a statement of the
business plan of the applicant. [1991 c.812 §5]
     744.708
Waiver of information requirement. Upon request from a third party administrator, the Director of the
Department of Consumer and Business Services may waive requirements established
pursuant to ORS 744.706 for information to be included in or with the
application if the third party administrator has a valid license or other
document of authority as a third party administrator issued in a state having
requirements for third party administrators that the director determines to be
sufficiently similar to the requirements established under ORS 744.706 so that
the filing of the information would serve little or no regulatory purpose. [1991
c.812 §6]
     744.710
Issuance or denial of license.
(1) If the Director of the Department of Consumer and Business Services
determines that an applicant has satisfied all requirements for a license as a
third party administrator, the director shall issue the license to the
applicant. The director shall not issue a license if the director determines
that the third party administrator, or any individual responsible for the
conduct of affairs of the third party administrator, as required to be set
forth in the application for the license, is not competent, trustworthy,
financially responsible or of good personal and business reputation, or has had
a license or other document of authority to transact insurance as an insurer,
insurance producer or third party administrator denied or revoked for cause by
any state.
     (2) If the director denies an application,
the director shall so inform the applicant, stating the grounds for the denial.
[1991 c.812 §7; 2003 c.364 §129]
     744.712
Expiration and renewal of license; rules for renewal. (1) A license of a third party administrator
expires on its expiration date unless it is renewed on or before its expiration
date.
     (2) Unless the Director of the Department
of Consumer and Business Services designates another date, a license expires on
the last day of the month in which the second anniversary of the initial
issuance date of the license occurs, and on the second anniversary following
each renewal.
     (3) The director by rule may establish
requirements for renewing licenses of third party administrators. [1991 c.812 §8]
     744.714
Registration of persons exempt from licensure. A person who is exempt from the requirement
of a license as a third party administrator under ORS 744.704 because the
person acts solely as an administrator of one or more bona fide employee
benefit plans established by an employer or an employee organization, or both,
for which the Insurance Code is preempted pursuant to the Employee Retirement
Income Security Act of 1974, shall register with the Director of the Department
of Consumer and Business Services annually, verifying the status of the person
as qualifying for the exemption. [1991 c.812 §9]
     744.716
Notification of change in ownership or control. A third party administrator shall
immediately notify the Director of the Department of Consumer and Business
Services of any material change in ownership or control or in any other matter
affecting the qualification of the third party administrator for a license as a
third party administrator in this state. [1991 c.812 §10]
     744.718
Suspension, revocation or refusal of issuance or renewal of license. (1) The Director of the Department of
Consumer and Business Services shall suspend, revoke or refuse to renew a
license of a third party administrator if the director finds that the third
party administrator:
     (a) Is in an unsound financial condition;
     (b) Is using such methods or practices in
the conduct of business so as to render further transaction of business by the
third party administrator in this state hazardous or injurious to insured
persons or to the public; or
     (c) Has failed to pay any judgment
rendered against the third party administrator in this state within 60 days
after the judgment has become final.
     (2) The director may suspend, revoke,
refuse to issue or refuse to renew a license of a third party administrator if
the director finds one or more of the following with respect to a third party
administrator or an applicant for a license therefor:
     (a) Falsification by the applicant or
licensee of an application for the license or renewal thereof, or engagement in
any dishonest act in relation to the application;
     (b) Dishonesty, fraud or gross negligence
in the transaction of insurance or in the conduct of business as a third party
administrator;
     (c) Conduct resulting in a conviction of a
felony under the laws of any state or of the
     (d) Conviction of any crime, an essential
element of which is dishonesty or fraud, under the laws of any state or of the
     (e) Refusal to renew or cancellation,
revocation or suspension of authority to transact insurance or business as a
third party administrator or similar entity in another state;
     (f) Failure to pay a civil penalty imposed
by final order of the director or to carry out terms of probation set by the
director;
     (g) Refusal to be examined or to produce
accounts, records or files for examination, refusal by any officers to give
information with respect to the affairs of the third party administrator or
refusal to perform any other legal obligation as to the examination when
required by the director;
     (h) Affiliation with or under the same
general management or interlocking directorate or ownership as another administrator
or insurer that unlawfully transacts business in this state;
     (i) Failure at any time to meet any
qualification for which issuance of the license could have been refused had the
failure then existed and been known to the director; or
     (j) Violation of any rule or order of the
director or any provision of the Insurance Code.
     (3) The director may suspend or refuse to
renew a license immediately and without hearing if the director determines that
one or more of the following circumstances exist:
     (a) The third party administrator is
insolvent;
     (b) A proceeding for receivership,
conservatorship or rehabilitation or other delinquency proceeding regarding the
third party administrator has been commenced in any state; or
     (c) The financial condition or business
practices of the third party administrator otherwise pose an imminent threat to
the public health, safety or welfare of the residents of this state.
     (4) A third party administrator holding a
license that has not been renewed or has been revoked shall surrender the
license to the director at the directorÂ’s request.
     (5) The director may take any other
administrative action authorized under the Insurance Code in addition to or in
lieu of the actions authorized under this section. [1991 c.812 §11]
     744.720
Agreement between insurer and third party administrator. (1) A third party administrator licensed
under ORS 744.702 may transact business as a third party administrator only
pursuant to a written agreement between the third party administrator and the
insurer. The agreement shall contain all provisions required by this section.
However, any provision that does not apply to the functions to be performed by
the third party administrator need not be included.
     (2) An insurer and a third party administrator
transacting business under an agreement required in subsection (1) of this
section shall each retain the agreement with its records for the duration of
the agreement and for five years following the date of its termination.
     (3) An agreement required by this section
shall include at least the following, in addition to any other requirements of
ORS 744.700 to 744.740:
     (a) A statement of duties that the third
party administrator is expected to perform on behalf of the insurer and the
lines, classes or types of insurance for which the third party administrator is
to be authorized to administer;
     (b) Provisions with respect to
underwriting or other standards pertaining to the business underwritten by the
insurer. The agreement shall also state the responsibilities of the third party
administrator for determining the benefits, premium rates, underwriting
criteria and claims payment procedures, and for securing any reinsurance,
subject to the responsibilities of the insurer established in ORS 744.740;
     (c) Provisions for the third party
administrator to periodically render an accounting to the insurer detailing all
transactions performed by the administrator pertaining to the business
underwritten by the insurer;
     (d) Provisions governing withdrawals from
the fiduciary account required under ORS 744.730, and provisions otherwise
relating to the fiduciary account, addressing at least the following matters:
     (A) Remittance to an insurer entitled to
the remittance;
     (B) Deposit in an account maintained in
the name of the insurer;
     (C) Transfer to and deposit in a
claims-paying account, with claims to be paid as provided in ORS 744.730;
     (D) Payment to a group policyholder for
remittance to the insurer entitled to the remittance;
     (E) Payment to the third party administrator
of its commission fees or charges; and
     (F) Remittance of return premiums to the
person entitled to the return premium; and
     (e) Provisions establishing which
disputes, if any, arising under the contract shall be decided by arbitration,
mediation or other means of dispute resolution.
     (4) Upon written notice, the insurer or
third party administrator may terminate the written agreement for cause as
provided in the agreement. The insurer may suspend the underwriting authority
of the third party administrator during any dispute regarding the cause for
termination of the written agreement. The insurer must fulfill any lawful
obligations with respect to policies affected by the agreement, regardless of
any dispute between the insurer and the third party administrator.
     (5) A third party administrator shall make
available for inspection to the Director of the Department of Consumer and
Business Services copies of all contracts, and amendments thereto, with
insurers or other persons using its services. [1991 c.812 §12]
     744.722
Relationship of insurer and third party administrator regarding payments. (1) When an insurer uses the services of a
third party administrator:
     (a) Payment to the third party
administrator of any premiums or charges for insurance by or on behalf of the
insured party shall be considered to have been received by the insurer.
     (b) Payment of return premiums or claim
payments forwarded by the insurer to the third party administrator shall not be
considered to have been paid to the insured party or claimant until the payment
is received by the insured party or claimant.
     (2) Nothing in this section limits any
right of the insurer against the third party administrator resulting from
failure by the third party administrator to make payments to the insurer,
insured parties or claimants. [1991 c.812 §13]
     744.724
Books and records. (1)
Except as provided in subsection (4) of this section, a third party
administrator shall maintain and make available to the insurer complete books
and records of each transaction performed on behalf of the insurer. The books
and records shall be maintained in accordance with prudent standards of
insurance recordkeeping and must be maintained for a period of not less than
five years from the date of their creation.
     (2) The Director of the Department of
Consumer and Business Services shall have access to the books and records
maintained under subsection (1) of this section for the purpose of examination,
audit and inspection. Any document, material or other information in the
possession or control of the director that is furnished by a third party
administrator, an insurer, an agent or an employee or an agent acting on behalf
of the third party administrator, insurer or insurance producer, or that is
obtained by the director in an investigation, shall be confidential as provided
in ORS 705.137.
     (3) An insurer that has entered into an
agreement with a third party administrator shall own the records generated by
the third party administrator pertaining to the insurer. However, the third
party administrator has the right to continuing access to the books and records
to permit the third party administrator to fulfill all of its contractual
obligations to insured parties, claimants and the insurer.
     (4) If an insurer and third party
administrator cancel their agreement, the third party administrator may agree
in writing with the insurer to transfer all records to a successor third party
administrator. If the agreement includes provisions to transfer the records,
the third party administrator is no longer responsible for retaining the
records for the five-year period. The successor third party administrator shall
acknowledge in writing as part of its agreement with the insurer that it is
responsible for retaining the records of the prior third party administrator as
required in subsection (1) of this section. [1991 c.812 §14; 2001 c.377 §16;
2003 c.364 §130]
     744.726
Errors and omissions insurance; rules. (1) A third party administrator must maintain with the Director of the
Department of Consumer and Business Services at all times a current certificate
of errors and omissions insurance, in an amount established by the director by
rule, from an insurer authorized to transact insurance in this state or from
any other insurer acceptable to the director according to standards established
by rule. The insurance must cover errors and omissions of and any violation of
fiduciary responsibility by the third party administrator or its employees, or
both.
     (2) If the director determines that
insurance required under this section is not generally available at a
reasonable cost, the director by rule may suspend the requirement of insurance,
but must reimpose the requirement when the insurance becomes available. [1991
c.812 §15]
     744.728
Advertising. A third party
administrator may use only such advertising pertaining to the business
underwritten by an insurer that the insurer has approved in advance of its use.
[1991 c.812 §16]
     744.730
Disposition of charges and premiums. (1) A third party administrator shall hold in a fiduciary capacity all
insurance charges or premiums collected by the third party administrator on
behalf of or for an insurer, and all return premiums received from the insurer.
The third party administrator shall immediately remit all charges, premiums or
return premiums to the person entitled to them or shall deposit them promptly
in a fiduciary account established and maintained by the third party
administrator in a federally or state insured financial institution. The
fiduciary account may be used only for deposits authorized under this
subsection.
     (2) If the charges or premiums deposited
in a fiduciary account have been collected on behalf of or for one or more
insurers, a third party administrator shall keep records clearly recording the
deposits in and withdrawals from the account on behalf of each insurer. The
third party administrator shall keep copies of all such records and, upon
request of an insurer, shall furnish the insurer with copies of the records
pertaining to such deposits and withdrawals.
     (3) A third party administrator shall not
pay any claim by withdrawals from a fiduciary account in which premiums or
charges are deposited.
     (4) All claims by a third party
administrator from funds collected on behalf of the insurer shall be paid only
on drafts of and as authorized by the insurer.
     (5) A third party administrator that is an
insurance producer licensed under this chapter need not comply with this
section if the third party administrator is in compliance with ORS 744.083 or
744.084 with respect to the premiums, charges and return premiums referred to
in this section. [1991 c.812 §17; 2003 c.364 §131]
     744.732
Contingent fee agreements.
(1) A third party administrator shall not enter into any agreement or
understanding with an insurer the effect of which is to make the amount of the
third party administratorÂ’s commissions, fees or charges contingent upon
savings effected in the adjustment, settlement and payment of losses covered by
the obligations of the insurer.
     (2) This section does not prohibit:
     (a) A third party administrator from
receiving performance-based compensation for providing hospital or other
auditing services; or
     (b) A third party administrator from
receiving compensation based on premiums or charges collected or on the number
of claims processed.
     (3) The third party administrator shall
disclose to the insurer all charges, fees and commissions received from all
sources in connection with the provision of administrative services for the insurer,
including any fees or commissions paid by insurers providing reinsurance. [1991
c.812 §18]
     744.734
Notice to insureds regarding third party administrator. (1) When an insurer uses the services of a
third party administrator, the third party administrator shall provide to
covered individuals a written notice approved by the insurer that advises them
of the identity of and relationship among the third party administrator, the
policyholder and the insurer.
     (2) When a third party administrator
collects funds, the reason for collection of each item must be identified to
the insured party and each item must be shown separately from any premium.
Additional charges may not be made for services to the extent the services have
been paid for by the insurer. [1991 c.812 §19]
     744.736
Delivery from insurer to insured. When the third party administrator receives policies, certificates,
booklets, termination notices or other written communications from the insurer
for delivery to insured parties or covered individuals, the third party
administrator shall promptly make the delivery after receiving instructions
from the insurer. [1991 c.812 §20]
     744.738
Annual report. (1) Each
third party administrator shall file an annual report for the preceding
calendar year with the Director of the Department of Consumer and Business
Services on or before March 1 of each year, or within such extension of time
therefor as the director may grant. The report shall be in the form and contain
such information as the director prescribes and shall be verified by at least
two officers of the third party administrator if the third party administrator
is a corporation, and by two partners if the third party administrator is a
partnership.
     (2) The annual report shall include the
complete names and addresses of all insurers with which the third party
administrator had an agreement during the preceding fiscal year. [1991 c.812 §21]
     744.740
Responsibility of insurer using third party administrator. (1) An insurer who uses the services of a third
party administrator is responsible for determining the benefits, premium rates,
underwriting criteria and claims payment procedures applicable to the coverage
and for securing any reinsurance. The rules pertaining to such matters must be
provided in writing by the insurer to the third party administrator.
     (2) An insurer is solely responsible for
providing competent administration of its programs.
     (3) When a third party administrator
administers benefits for more than 100 certificate holders on behalf of an
insurer, the insurer shall conduct a review of the operations of the third
party administrator at least annually. [1991 c.812 §22]
REINSURANCE
INTERMEDIARIES
     744.800
Qualifications for reinsurance intermediary brokers and managers. (1) For purposes of ORS 744.800 to 744.818:
     (a) A reinsurance intermediary broker is a
person who solicits, negotiates or places reinsurance cessions or retrocessions
on behalf of a ceding insurer without acting as a reinsurance intermediary
manager on behalf of the insurer.
     (b) A reinsurance intermediary manager is
a person who has authority to bind a reinsurer or who manages all or part of
the assumed reinsurance business of a reinsurer, including the management of a
separate division, department or underwriting office, and acts as an insurance
producer for the reinsurer, regardless of the title or designation of the
person.
     (c) A reinsurance intermediary means a
reinsurance intermediary broker or a reinsurance intermediary manager.
     (d) “Business entity” has the meaning
given that term in ORS 731.116.
     (2) A person may act as a reinsurance
intermediary broker in this state only as follows:
     (a) The person maintains an office in this
state either directly or as a member or employee of a firm or association, or
an officer, director or employee of a corporation, and the person is a licensed
insurance producer or reinsurance intermediary in this state; or
     (b) The person maintains an office in
another state either directly or as a member or employee of a firm or association,
or an officer, director or employee of a corporation, and the person is a
licensed insurance producer or reinsurance intermediary in this state or
another state having laws substantially similar to ORS 744.800 to 744.818.
     (3) A person may act as a reinsurance
intermediary manager only as follows:
     (a) A person may act as a reinsurance
intermediary manager for a reinsurer domiciled in this state if the person is a
licensed insurance producer or reinsurance intermediary in this state.
     (b) A person may act as a reinsurance
intermediary manager in this state if the person maintains an office in this
state either directly or as a member or employee of a firm or association, or
as an officer, director or employee of a corporation, if the person is a licensed
insurance producer or reinsurance intermediary in this state.
     (4) The Director of the Department of
Consumer and Business Services may issue a reinsurance intermediary license to
any person that has complied with the requirements of this section. A license
issued to a firm or association authorizes all of the members of the firm or
association and any designated employees of the firm or association to act as
reinsurance intermediaries under the license. All such persons must be named in
the license application and any supplements to the application. A license
issued to a corporation authorizes all of the officers and any designated
employees and directors of the corporation to act as reinsurance intermediaries
on behalf of the corporation. All such persons must be named in the license
application and any supplements to the application.
     (5) The director shall issue a resident
reinsurance intermediary license to a person if the person holds an insurance
producer license issued under ORS 744.062 and indorsed with the designation of
reinsurance intermediary.
     (6) The director shall issue a nonresident
reinsurance intermediary license to a person if:
     (a) The person is currently licensed in
the personÂ’s home state as a resident reinsurance intermediary or insurance
producer and is in good standing in the personÂ’s home state;
     (b) The person has submitted the proper
request for a license and has paid the applicable fees;
     (c) The person has submitted or
transmitted to the director the license application that the person submitted
to the personÂ’s home state or, in lieu of that application, a completed
application acceptable to the director; and
     (d) The person’s home state awards
nonresident reinsurance intermediary licenses to residents of this state on the
same basis.
     (7) The director may refuse to issue a
reinsurance intermediary license if, in the directorÂ’s judgment:
     (a) The application, anyone named in the
application or any member, principal, officer, director or controlling person
of the applicant is not trustworthy; or
     (b) Any person described in paragraph (a)
of this subsection has given cause for revocation or suspension of the license
or has failed to comply with any requirement for issuance of the license.
     (8) In order to obtain and maintain the
indorsement of reinsurance intermediary manager, a resident reinsurance
intermediary must satisfy the requirements of ORS 744.818 regarding errors and
omissions insurance. [1993 c.447 §74; 2001 c.191 §41; 2003 c.364 §27]
     744.802
Exemptions from application of requirements for reinsurance intermediary
brokers and managers. (1) An
officer or employee of a ceding insurer is not subject to the requirements of
ORS 744.800 to 744.818 that apply to reinsurance intermediary brokers, with
respect to the ceding insurer.
     (2) When engaged in a relationship
described in this subsection, the following persons are not subject, with
respect to the reinsurer in the relationship, to the requirements of ORS
744.800 to 744.818 that apply to reinsurance intermediary managers:
     (a) An employee of the reinsurer.
     (b) A
     (c) An underwriting manager who, pursuant
to contract, manages all of the reinsurance operations of the reinsurer, is
under common control with the reinsurer and subject to ORS 732.517 to 732.592,
and whose compensation is not based on the volume of premiums written.
     (d) The manager of a group, association,
pool or organization of insurers who engage in joint underwriting or joint
reinsurance and who are subject to examination by the insurance regulatory
official of the state in which the managerÂ’s principal business office is
located.
     (3) An attorney-at-law rendering services
in the performance of duties of an attorney-at-law is not subject to the
requirements of ORS 744.800 to 744.818 that apply to reinsurance intermediary
brokers or reinsurance intermediary managers. [1993 c.447 §75; 2003 c.364 §28]
     744.804
Conditions under which reinsurance intermediary broker and insurer may enter into
transactions. A reinsurance
intermediary broker and the insurer it represents in the capacity of a
reinsurance intermediary broker may enter one or more transactions between them
only pursuant to a written authorization that specifies the responsibilities of
each party. The authorization must at least provide that:
     (1) The insurer may terminate the
authority of the reinsurance intermediary broker at any time.
     (2) The reinsurance intermediary broker
must render to the insurer accounts accurately detailing all material
transactions, including information necessary to support all commissions,
charges and other fees received by or owing to the reinsurance intermediary
broker, and remit all funds due to the insurer not later than the 30th day
following the date of receipt.
     (3) All funds collected for the account of
the insurer must be held by the reinsurance intermediary broker in a fiduciary
capacity in a qualified
     (a) Is organized, or, in the case of a
     (b) Is regulated, supervised and examined
by authorities of the United States or of any state thereof having regulatory
authority over banks and trust companies; and
     (c) Has been determined by the Director of
the Department of Consumer and Business Services to meet standards of financial
condition and standing that are necessary and appropriate for regulating the
quality of financial institutions whose letters of credit will be acceptable to
the director. The director may consider standards and classifications of
institutions established by the Securities Valuation Office of the National
Association of Insurance Commissioners for the purpose of making determinations
under this paragraph.
     (4) The reinsurance intermediary broker
must comply with ORS 744.806.
     (5) The reinsurance intermediary broker must
comply with the written standards established by the insurer for the cession or
retrocession of all risks.
     (6) The reinsurance intermediary broker
must disclose to the insurer any relationship with any reinsurer to which
business will be ceded or retroceded. [1993 c.447 §76; 2003 c.364 §29]
     744.806
Records required to be kept by reinsurance intermediary brokers. (1) A reinsurance intermediary broker must
keep a complete record for each transaction of a contract of reinsurance as
provided in this subsection. For each contract of reinsurance transacted by the
reinsurance intermediary broker that is limited to first party property
coverages, the reinsurance intermediary broker must keep the record for not
less than five years after expiration of the contract of reinsurance. For all
other contracts of reinsurance transacted by the reinsurance intermediary
broker, the reinsurance intermediary broker must keep the record for not less
than 10 years after expiration of each contract of reinsurance. The record must
show all of the following:
     (a) The type of contract, limits,
underwriting restrictions, classes or risks and territory.
     (b) The period of coverage, including
effective and expiration dates, cancellation provisions and notice required of
cancellation.
     (c) Reporting and settlement requirements
of balances.
     (d) The rate used to compute the
reinsurance premium.
     (e) Names and addresses of assuming
reinsurers.
     (f) Rates of all reinsurance commissions,
including the commissions on any retrocessions handled by the reinsurance
intermediary broker.
     (g) Related correspondence and memoranda.
     (h) Proof of placement.
     (i) Details regarding retrocessions
handled by the reinsurance intermediary broker, including the identity of
retrocessionaires and percentage of each contract assumed or ceded.
     (j) Financial records, including premium
and loss accounts.
     (k) The following written evidence, when
the reinsurance intermediary broker procures a reinsurance contract on behalf
of an authorized ceding insurer:
     (A) When the contract is procured directly
from any assuming reinsurer, written evidence that the assuming reinsurer has
agreed to assume the risk.
     (B) When the contract is placed through a
representative of the assuming reinsurer other than an employee, written
evidence that the reinsurer has delegated binding authority to the
representative.
     (2) The insurer must have access to and
the right to copy and audit all accounts and records maintained by the
reinsurance intermediary broker and related to its business. The reinsurance
intermediary broker must maintain the accounts and records in a form usable by
the insurer. [1993 c.447 §77; 2003 c.364 §30]
     744.808
Prohibition on use of unlicensed reinsurance intermediary broker; requirement
that insurer obtain financial statement of reinsurance intermediary broker. (1) An insurer may not engage the services
of any person to act as a reinsurance intermediary broker on its behalf unless
the person is licensed as a reinsurance intermediary broker as required by ORS
744.800.
     (2) An insurer may not employ an
individual who is employed by a reinsurance intermediary broker with which it
transacts business unless the reinsurance intermediary broker is under common
control with the insurer and subject to ORS 732.517 to 732.592.
     (3) The insurer must annually obtain a
copy of statements of the financial condition of each reinsurance intermediary
broker with which it transacts business. [1993 c.447 §78; 2003 c.364 §31]
     744.810
Conditions under which reinsurance intermediary manager and reinsurer may enter
into transactions. A
reinsurance intermediary manager and the reinsurer it represents in that
capacity may enter a transaction only pursuant to a written contract that
specifies the responsibilities of each party and otherwise satisfies the
requirements of this section. The contract must be approved by the board of
directors of the reinsurer. Not later than the 30th day before the reinsurer
assumes or cedes business through the reinsurance intermediary manager, a true
copy of the approved contract must be filed with the Director of the Department
of Consumer and Business Services for approval. The contract must at least
provide that:
     (1) The reinsurer may terminate the
contract for cause upon written notice to the reinsurance intermediary manager,
and the reinsurer may immediately suspend the authority of the reinsurance
intermediary manager to assume or cede business during the pendency of any
dispute regarding the cause for termination.
     (2) The reinsurance intermediary manager
must render accounts to the reinsurer, accurately detailing all material
transactions and including information necessary to support all commissions,
charges and other fees received by or owing to the reinsurance intermediary
manager and remit all funds due under the contract to the reinsurer on not less
than a monthly basis.
     (3) All funds collected for the account of
the reinsurer must be held by the reinsurance intermediary manager in a
fiduciary capacity in a qualified
     (4) A reinsurance intermediary manager
must keep a complete record for each transaction of a contract of reinsurance
as provided in this subsection. For each contract of reinsurance transacted by
the reinsurance intermediary manager that is limited to first party property
coverages, the reinsurance intermediary manager must keep the record for not
less than five years after expiration of the contract of reinsurance. For all
other contracts of reinsurance transacted by the reinsurance intermediary
manager, the reinsurance intermediary manager must keep the record for not less
than 10 years after expiration of each contract of reinsurance. The record must
show all of the following:
     (a) The type of contract, limits,
underwriting restrictions, classes or risks and territory.
     (b) The period of coverage, including
effective and expiration dates, cancellation provisions and notice required of
cancellation, and disposition of outstanding reserves on covered risks.
     (c) Reporting and settlement requirements
of balances.
     (d) The rate used to compute the
reinsurance premium.
     (e) Names and addresses of reinsurers.
     (f) The rates of all reinsurance
commissions, including the commissions on any retrocessions handled by the reinsurance
intermediary manager.
     (g) Related correspondence and memoranda.
     (h) Proof of placement.
     (i) Specific information regarding
retrocessions handled by the reinsurance intermediary manager, including the
identity of retrocessionaires and percentage of each contract assumed or ceded.
     (j) Financial records, including premium
and loss accounts.
     (k) The following written evidence, when
the reinsurance intermediary manager places a reinsurance contract on behalf of
a ceding insurer:
     (A) When the contract is procured directly
from any assuming reinsurer, written evidence that the assuming reinsurer has
agreed to assume the risk; or
     (B) When the contract is placed through a
representative of the assuming reinsurer, other than an employee, written evidence
that the reinsurer has delegated binding authority to the representative.
     (5) The reinsurer must have access to and
the right to copy all accounts and records maintained by the reinsurance
intermediary manager that are related to its business. The reinsurance
intermediary manager must maintain the accounts and records in a form usable by
the reinsurer.
     (6) The contract cannot be assigned in
whole or in part by the reinsurance intermediary manager.
     (7) The reinsurance intermediary manager
must comply with the written underwriting and rating standards established by
the insurer for the acceptance, rejection or cession of all risks.
     (8) The contract must set forth the rates,
terms and purposes of commissions, charges and other fees that the reinsurance
intermediary manager may levy against the reinsurer.
     (9) If the contract permits the
reinsurance intermediary manager to settle claims on behalf of the reinsurer,
all of the following provisions must apply:
     (a) All claims must be reported to the
reinsurer in a timely manner.
     (b) A copy of the claim file must be sent
to the reinsurer at its request or as soon as it becomes known that the claim:
     (A) Has the potential of exceeding the
lesser of an amount determined by the director or the limit set by the
reinsurer;
     (B) Involves a coverage dispute;
     (C) May exceed the claims settlement
authority of the reinsurance intermediary manager;
     (D) Is open for more than six months; or
     (E) Is closed by payment of the lesser of
an amount set by the director or an amount set by the reinsurer.
     (c) All claim files must be the joint
property of the reinsurer and the reinsurance intermediary manager. However,
upon an order of liquidation of the reinsurer, the files become the sole
property of the reinsurer or its estate but the reinsurance intermediary
manager shall have reasonable access to and the right to copy the files on a
timely basis.
     (d) Any settlement authority granted to
the reinsurance intermediary manager may be terminated for cause upon written
notice by the reinsurer to the reinsurance intermediary manager or upon the
termination of the contract. The reinsurer may suspend the settlement authority
during the pendency of the dispute regarding the cause of termination.
     (10) If the contract provides for a sharing
of interim profits by the reinsurance intermediary manager, the interim profits
must not be paid until one year after the end of each underwriting period for
property business and five years after the end of each underwriting period for
casualty business, or a later period set by the director for specified lines of
insurance, and not until the adequacy of loss reserves on remaining claims has
been attested to by an actuary pursuant to ORS 744.814.
     (11) The reinsurance intermediary manager
must annually provide the reinsurer with a statement of its financial condition
that is prepared by an independent certified public accountant.
     (12) Periodically, but not less frequently
than semiannually, the reinsurer shall conduct an on-site review of the
underwriting and claims processing operations of the reinsurance intermediary
manager.
     (13) The reinsurance intermediary manager
must disclose to the reinsurer any relationship it has with any insurer prior
to ceding or assuming any business with such insurer pursuant to the contract.
     (14) Within the scope of the actual or
apparent authority of the reinsurance intermediary manager, the acts of the
reinsurance intermediary manager are considered to be the acts of the reinsurer
on whose behalf it is acting. [1993 c.447 §79; 2003 c.364 §32]
     744.812
Prohibitions on actions of reinsurance intermediary managers. A reinsurance intermediary manager may not
do any of the following:
     (1) Cede retrocessions on behalf of the
reinsurer that the reinsurance intermediary manager represents, except that the
reinsurance intermediary manager may cede facultative retrocessions pursuant to
obligatory facultative agreements if the contract with the reinsurer contains
reinsurance underwriting guidelines for the retrocessions. The guidelines must
include:
     (a) A list of reinsurers with which the
automatic agreements are in effect;
     (b) For each such reinsurer, the coverages
and amounts or percentages that may be reinsured; and
     (c) For each such reinsurer, the
commission schedules.
     (2) Commit the reinsurer to participate in
reinsurance syndicates.
     (3) Appoint an insurance producer,
reinsurance intermediary broker or reinsurance intermediary manager without
assuring that the insurance producer, reinsurance intermediary broker or
reinsurance intermediary manager is lawfully licensed to transact the type of
reinsurance for which the appointment is made.
     (4) Without prior approval of the
reinsurer, pay or commit the reinsurer to pay a claim, net of retrocessions,
that exceeds the lesser of an amount specified by the reinsurer or one percent
of the combined capital and surplus of the reinsurer as of December 31 of the
last complete calendar year.
     (5) Collect any payment from a
retrocessionaire or commit the reinsurer to any claim settlement with a
retrocessionaire, without prior approval of the reinsurer. If prior approval is
given, the reinsurance intermediary manager must promptly forward a report to
the reinsurer.
     (6) Jointly employ an individual who is
employed by the reinsurer, unless the reinsurance intermediary manager is under
common control with the reinsurer subject to ORS 732.517 to 732.592.
     (7) Appoint a reinsurance subintermediary
manager. [1993 c.447 §80; 2003 c.364 §33]
     744.814
Prohibition on use of unlicensed reinsurance intermediary manager; requirement
that reinsurer obtain financial statement of reinsurance intermediary manager
and opinion of actuary. (1)
A reinsurer may not engage the services of any person to act as a reinsurance
intermediary manager on its behalf unless the person is licensed to act as a
reinsurance intermediary manager as required by ORS 744.800.
     (2) A reinsurer shall annually obtain a
copy of statements of the financial condition of each reinsurance intermediary
manager that the reinsurer has engaged. Each statement must be prepared by an
independent certified public accountant in a form acceptable to the Director of
the Department of Consumer and Business Services.
     (3) If a reinsurance intermediary manager
establishes loss reserves, the reinsurer shall annually obtain the opinion of
an actuary who is in good standing of the American Academy of Actuaries,
attesting to the adequacy of loss reserves established for losses incurred and
outstanding on business produced by the reinsurance intermediary manager. The
opinion must be in addition to any other required loss reserve certification.
     (4) Binding authority for all
retrocessional contracts or participation in reinsurance syndicates must rest
with an officer of the reinsurer who is not affiliated with the reinsurance
intermediary manager.
     (5) Not later than the 30th day after
termination of a contract with a reinsurance intermediary manager, the
reinsurer shall provide written notification of the termination to the
director.
     (6) A reinsurer may not appoint to its
board of directors any officer, director, employee, controlling shareholder or
subproducer of its reinsurance intermediary manager. This subsection does not
apply to relationships governed by ORS 732.517 to 732.592. [1993 c.447 §81;
2003 c.364 §34]
     744.816
Director access to books, accounts and records. (1) The Director of the Department of
Consumer and Business Services may examine any reinsurance intermediary broker
and any reinsurance intermediary manager. The director shall have access to all
books, bank accounts and records of a reinsurance intermediary broker or
reinsurance intermediary manager being examined. All such books, bank accounts
and records must be maintained in a form usable to the director.
     (2) A reinsurance intermediary manager may
be examined as if the reinsurance intermediary manager were the reinsurer. [1993
c.447 §82; 2003 c.364 §35]
     744.818
Errors and omissions insurance for reinsurance intermediary manager; rules. (1) A resident reinsurance intermediary
acting as a reinsurance intermediary manager shall maintain with the Director
of the Department of Consumer and Business Services a current certificate of
errors and omissions insurance in an amount established by the director by rule
from an insurer authorized to do business in this state or from any other
insurer acceptable to the director according to standards established by rule.
     (2) If the director determines that errors
and omissions insurance required under this section is not generally available
at a reasonable cost, the director by rule may suspend the requirement of
insurance, but must reimpose the requirement when the insurance becomes
available once again. [1993 c.447 §83; 2003 c.364 §36]
     744.820
Director authority if reinsurance intermediary broker or manager violates
provisions of ORS 744.800 to 744.818. If the Director of the Department of Consumer and Business Services
finds that a reinsurance intermediary broker or a reinsurance intermediary
manager has violated any provision of ORS 744.800 to 744.818, the director may
order the reinsurance intermediary broker or reinsurance intermediary manager
to reimburse the insurer, reinsurer, rehabilitator or liquidator for losses
incurred by the insurer or reinsurer because of the violation. The director may
take action under this section in addition to or instead of any other action
that the director may take under the Insurance Code. [1993 c.447 §83a; 2003
c.364 §37]
VEHICLE
RENTAL COMPANIES
     744.850
Definitions for ORS 744.850 to 744.858. As used in ORS 744.850 to 744.858:
     (1) “Limited license” means a license
issued under ORS 744.852 that authorizes a rental company to offer or sell
insurance as provided in ORS 744.854.
     (2) “Rental agreement” means a written
agreement setting forth the terms and conditions governing use of a vehicle
provided by a rental company for rent.
     (3) “Rental company” means a person or
entity in the business of providing vehicles to the public under a rental
agreement for a period of 90 days or less.
     (4) “Renter” means a person obtaining the
use of a vehicle from a rental company for a period of 90 days or less.
     (5) “Vehicle” means an automobile, van,
minivan, sports utility vehicle, cargo van, recreational vehicle, motorcycle,
all-terrain vehicle, trailer, pickup truck or truck with a gross vehicle weight
of less than 26,000 pounds that does not require a commercial driver license to
operate. [1999 c.485 §2; 2007 c.719 §1]
     Note: 744.850 to 744.858 were added to and made a
part of the Insurance Code by legislative action but were not added to ORS
chapter 744 or any series therein. See Preface to Oregon Revised Statutes for
further explanation.
     744.852
Limited license for rental companies; application; rules. (1) The Director of the Department of
Consumer and Business Services shall adopt rules establishing information
required to be submitted by rental companies applying for a limited license.
     (2) A rental company that intends to offer
insurance as described in ORS 744.854 shall file a limited license application
with the director in such form and containing such information as the director
requires.
     (3) Upon receipt of an application, if the
director is satisfied that the application is complete, the director may issue
a limited license to the rental company. [1999 c.485 §3]
     Note: See note under 744.850.
     744.854
Kinds of insurance authorized by limited license. A limited license issued under ORS 744.852
authorizes a rental company to offer and sell the following kinds of insurance
in connection with the rental of vehicles:
     (1) Personal accident insurance covering
the risks of travel, including but not limited to accident and health insurance
that provides coverage to renters and other occupants of the rental vehicle for
accidental death or dismemberment and reimbursement for medical expenses
resulting from an accident that occurs during the rental period.
     (2) Liability insurance that provides
coverage to renters and other authorized drivers of the rental vehicle for
liability arising from the operation of the rental vehicle. Liability insurance
shall include uninsured and underinsured motorist coverage, insofar as required
by state law or rule.
     (3) Personal effects insurance that
provides coverage to renters and other vehicle occupants for loss of and damage
to personal effects during the rental period.
     (4) Roadside assistance and emergency
sickness insurance. [1999 c.485 §4]
     Note: See note under 744.850.
     744.856
Conditions for issuance of insurance; training; filing officer. (1) A rental company issued a limited license
under ORS 744.852 may not issue insurance pursuant to ORS 744.854 unless:
     (a) The rental agreement is for a period
of 90 consecutive days or less.
     (b) At every location where rental
agreements are executed, there is written material available to prospective
renters that:
     (A) Summarizes clearly and correctly the
material terms of the coverage offered and identifies the insurer;
     (B) Discloses that the coverage offered by
the rental company may duplicate coverage already provided by a renterÂ’s
personal motor vehicle liability insurance policy, personal liability insurance
policy or other source of coverage;
     (C) States that the purchase of the
coverage offered is not required in order to rent a vehicle; and
     (D) Describes the process for filing a
claim.
     (c) The written material referred to in
paragraph (b) of this subsection has been filed with and approved by the
Director of the Department of Consumer and Business Services.
     (d) The rental agreement separately
discloses the price for the coverage purchased.
     (2) A rental company issued a limited
license under ORS 744.852 must conduct a training program for employees
concerning kinds of coverage offered by the company. The syllabus for the
training program shall be filed annually with the Director of the Department of
Consumer and Business Services by the rental company and is subject to approval
by the director. The rental company shall certify annually to the director that
all employees involved in the sale or offer of coverage to members of the
public have completed or will complete the training program prior to conducting
such sales or offers. The rental company shall also certify annually to the
director that all such employees will receive continuing education on a regular
basis concerning the topics covered in the training program. The rental companyÂ’s
compliance with its certification to the director and with the filed training
program syllabus is subject to audit by the Department of Consumer and Business
Services.
     (3) A rental company issued a limited
license under ORS 744.852 may not advertise, represent or otherwise hold itself
or its employees out as licensed insurers or insurance producers.
     (4) A rental company issued a limited
license under ORS 744.852 may offer and sell insurance only in connection with
and incidental to the rental of vehicles.
     (5) A rental company issued a limited
license under ORS 744.852 shall designate an executive as the statewide filing
officer for the rental company. [1999 c.485 §5; 2003 c.364 §132]
     Note: See note under 744.850.
     744.858
Revocation or suspension of limited license; other penalties; application of
Insurance Code; rules. (1)
If a rental company issued a limited license under ORS 744.852 offers or sells
insurance not authorized by ORS 744.854, or violates any provision of ORS
744.856, the Director of the Department of Consumer and Business Services may,
after notice and hearing, revoke or suspend the limited license or may impose
such other penalties as the director prescribes, including but not limited to
suspension of transaction of insurance at specific rental locations where
violations of ORS 744.854 or 744.856 have occurred.
     (2) All provisions of the Insurance Code
apply to rental companies issued limited licenses under ORS 744.852 unless
specifically rendered inapplicable by statute or by rule adopted by the
director.
     (3) The director may adopt any rules
necessary for the implementation of ORS 744.850 to 744.858, including rules
establishing license fees to defray the cost to the Department of Consumer and
Business Services of administering the limited licensure program. [1999 c.485 §6]
     Note: See note under 744.850.
     744.990 [Repealed by 1967 c.359 §704]
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