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OregonHB 21302025 Regular SessionHouseWALLET

Relating to the Oregon Insurance Guaranty Association.

Sponsored By: Sponsor information unavailable

Signed by Governor

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Bill Overview

Analyzed Economic Effects

7 provisions identified: 1 benefits, 2 costs, 4 mixed.

Higher claim payments after insurer failure

The Oregon Insurance Guaranty Association pays up to $600,000 per covered claim for insurer insolvencies on or after January 1, 2025. For insolvencies from September 9, 1971, through December 31, 2024, it covers only the portion below $300,000. Covered claims must exist when insolvency is determined or arise within 30 days afterward. Covered workers’ compensation claims are paid in full, minus any Workers’ Benefit Fund payment. Payments cannot exceed the failed insurer’s policy limits.

Cyber insurance protection has shared limits

The law explicitly includes cybersecurity insurance sold directly by an insurer licensed in Oregon, unless another exclusion applies. The Oregon Insurance Guaranty Association is not required to pay more than $600,000 total for one covered cyber incident. That shared limit covers claims for the insured’s own losses and claims by others, regardless of the number of claimants. Combined claims above the limit may leave losses unpaid.

Claimants must use other insurance first

Claimants must use all other policy coverage for the same facts, injury, or loss first, including any legal defense. The Association gets credit for that policy’s full applicable limits, or total recovery if the policy has no stated limits. Asbestos and environmental pollution claims require using all available coverage under other policies across all periods first. The rule also addresses self-insured claimants and cases where multiple parties share legal responsibility.

Claim defense ends at payment limits

The Oregon Insurance Guaranty Association must investigate, handle, defend, settle, and pay covered claims within its legal obligations. Its duty to defend an insured ends when it offers or pays the lower of the claim’s statutory or policy limit. After that point, the insured no longer receives a defense under this duty.

Transferred policies depend on original insurer

Guaranty protection follows a policy first issued by an Association member when another insurer takes sole responsibility and enters liquidation. This applies even if a court order or policy-transfer agreement released the original insurer. A policy first issued by a nonmember gets no Association protection merely because a member later takes it over. That exclusion covers transfers by agreement or through state-law allocation, transfer, or assumption.

Wealthy policyholders face limits and repayment

The $25 million net-worth test uses December 31 before the insolvency year and includes consolidated subsidiaries. Insureds above that amount cannot claim their own losses, but the Association may choose to pay their cyber claims. The Association may recover payments, including defense fees, that satisfy these insureds’ or affiliates’ liabilities to others; workers’ compensation is exempt. For cyber claims, it may recover all payments to or for these insureds, including defense and loss payments. It may also recover legal fees and court costs from a lawsuit to collect those cyber payments.

Government insurance and claims lose protection

The Oregon Insurance Guaranty Association does not protect insurance provided or guaranteed by a state or the federal government. Amounts owed to Oregon or the federal government are also excluded from covered claims. The government-claim exclusion does not apply to Workers’ Benefit Fund claims under Oregon workers’ compensation law.

Sponsors & Cosponsors

Sponsors

There is no primary sponsor on record.

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

All Roll Calls

Yes: 101 • No: 0

Senate vote • 4/29/2025

Third reading. Carried by Taylor. Passed.

Yes: 28 • No: 0

Senate vote • 4/15/2025

Labor and Business: Heard and Reported Out

Yes: 5 • No: 0

House vote • 3/11/2025

Third reading. Carried by Reschke. Passed.

Yes: 58 • No: 0

House vote • 3/4/2025

Commerce and Consumer Protection: Heard and Reported Out

Yes: 10 • No: 0

Actions Timeline

  1. Chapter 20, (2025 Laws): Effective date January 1, 2026.

    5/20/2025House

  2. Governor signed.

    5/7/2025House

  3. President signed.

    5/1/2025Senate

  4. Speaker signed.

    5/1/2025House

  5. Third reading. Carried by Taylor. Passed.

    4/29/2025Senate

  6. Carried over to 04-29 by unanimous consent.

    4/28/2025Senate

  7. Carried over to 04-28 by unanimous consent.

    4/24/2025Senate

  8. Carried over to 04-24 by unanimous consent.

    4/23/2025Senate

  9. Second reading.

    4/22/2025Senate

  10. Recommendation: Do pass.

    4/22/2025Senate

  11. Work Session held.

    4/15/2025Senate

  12. Public Hearing held.

    4/10/2025Senate

  13. Referred to Labor and Business.

    3/13/2025Senate

  14. First reading. Referred to President's desk.

    3/13/2025Senate

  15. Third reading. Carried by Reschke. Passed.

    3/11/2025House

  16. Second reading.

    3/10/2025House

  17. Recommendation: Do pass.

    3/7/2025House

  18. Work Session held.

    3/4/2025House

  19. Public Hearing held.

    2/11/2025House

  20. Referred to Commerce and Consumer Protection.

    1/17/2025House

  21. First reading. Referred to Speaker's desk.

    1/13/2025House

Bill Text

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