Oregon Administrative Code

836-029-0025 Annual Audit (1) All captive insurers shall have an annual audit by an independent certified public accountant, approved by the Director of the Department of Consumer and Business Services, and shall file an audited financial report with the director on or before Jun…

836-029-0030 Management’s Report of Internal Control over Financial Reporting (1) Each insurer required to file an audited financial report pursuant to OAR 836-029-0015 that has annual direct written and assumed premiums of $500,000,000 or more, excluding premiums reinsured with …

836-029-0035 Communication of Internal Control Related Matters Noted in an Audit (1) In addition to the annual audited financial report, each captive insurer that has annual direct written premium of $500,000,000 or more shall furnish the director with a written communication as …

836-029-0040 Designation of Service Providers (1) A certified public accountant retained to conduct the independent annual audit must be selected from the list of approved certified public accounting firms or individual certified public accountants maintained by the Director of t…

836-029-0045 Notification of Material Misstatement of Financial Condition A captive insurer shall require its certified public accountant to immediately notify an officer and all members of the board of directors of the captive insurer in writing of any determination by the indep…

836-029-0050 Additional Deposit Requirement (1) Whenever the Director of the Department of Consumer and Business Services determines that the financial condition of a captive insurer warrants additional security, the director may require the captive insurer to deposit with the di…

836-029-0055 Availability and Maintenance of Working Papers of the Independent Certified Public Accountant Availability and Maintenance of Working Papers of the Independent Certified Public Accountant (1) Each captive insurer shall require its independent certified public account…

836-029-0060 Documentation Required to be Held in Oregon by Licensed Captives (1) Any captive insurer authorized by the Director of the Department of Consumer and Business Services, shall maintain and make ready for inspection and examination by the director, or the director's ag…

836-029-0065 Reinsurance (1) Any captive insurer authorized to do business in this state may take credit for reserves on risks ceded to a reinsurer subject to the following limitations: (a) No credit shall be allowed for reinsurance where the reinsurance contract does not result …

836-029-0070 Service Providers A person may not act in or from this state, as a service provider, including but not limited to as a captive insurance manager, producer, actuary or certified public accountant, for a captive insurer without the authorization of the Director of the …

836-029-0075 Directors (1) Every captive insurer shall report any change in its executive officers or directors to the Director of the Department of Consumer and Business Services within thirty days after a change is made and include in its report, a biographical affidavit of any…

836-029-0080 Conflict of Interest (1) Each captive insurer licensed in Oregon shall adopt a conflict of interest statement for officers, directors and key employees. The statement shall disclose that the individual has no outside commitments, personal or otherwise, that would div…

836-029-0085 Acquisition of Control of or Merger with Domestic Captive insurer The acquisition of control of, or merger of, a domestic captive insurer shall be regulated in accordance with section 9, chapter 84, Oregon Laws 2012. However, the Director of the Department of Consume…

836-029-0090 Suspension or Revocation (1) The Director of the Department of Consumer and Business Services may by order suspend or revoke the license of a captive insurer or place the captive insurer on probation on the following grounds: (a) The captive insurer has not commenced…

836-029-0095 Standards The director may consider the following standards, either singly or in combination of two or more, to determine whether the continued operation of any captive insurer transacting insurance in this state might be determined to be hazardous to the policyholde…

836-029-0100 Director's Authority (1) For the purposes of making a determination of the financial condition of a captive insurer under OAR 836-029-0090 to 836-029-0100, the director may do one or more of the following: (a) Disregard any credit or amount receivable resulting from …

836-029-0105 Change of Information in Initial Application (1) Any material change in a captive insurer's business plan that is filed with the Director of the Department of Consumer and Business Services at the time of initial application and any subsequent amendment of the plan r…

836-029-0110 Application (1) In order to form a domestic captive insurer a person shall apply to the director of the Department of Consumer and Business Services for a permit to organize using the form, “Application for Permit to Organize Captive Insurer With or Without Capital S…

836-029-0115 Fees (1) At the time an applicant submits an application under OAR 836-029-0110 for a permit to organize a captive insurer or for a certificate of authority to operate as a captive insurer the applicant shall pay to the Director of the Department of Consumer and Busi…

836-029-0120 Authorized Forms (1) The following forms must be used for any applicant applying for a certificate of authority as a new captive insurer: (a) "Application for Permit to Organize Captive Insurer With or Without Capital Stock;” (b) “Application to Form a Captive insure…

836-031-0200 Scope, Authority; Statutes Implemented; Application (1) OAR 836-031-0200 to 836-031-0300 apply to all individual and group health insurance coverages except credit insurance and establish minimum standards for the following three categories of health insurance reserv…

836-031-0210 Definitions, Application and Explanation of Technical Terms Used As used in OAR 836-031-0200 to 836-031-0300, the following terms have the following definitions and applications and are explained as follows: (1) “Annual claim cost” means the net annual cost per unit …

836-031-0220 Principles Governing Reserves (1) When an insurer determines that health insurance reserves meeting the minimum standards specified in OAR 836-031-0200 to 836-031-0300 are inadequate, increased reserves shall be held and shall be considered the minimum reserves for t…

836-031-0230 Claim Reserves (1) The following provisions apply to claim reserves generally: (a) An insurer must maintain claim reserves for all incurred but unpaid claims on all health insurance policies; (b) An insurer must maintain appropriate claim expense reserves with respec…

836-031-0240 Premium Reserves (1) The following provisions apply to premium reserves generally: (a) An insurer must maintain unearned premium reserves for all contracts with respect to the period of coverage beyond the date of valuation for which premiums, other than premiums pai…

836-031-0250 Contract Reserves (1) The following provisions apply to contract reserves generally: (a) Unless otherwise specified in subsection (b) of this section (1), an insurer must maintain contract reserves for: (A) All individual and group contracts with which level premiums…

836-031-0260 Reinsurance Increases to or credits against reserves held that arise because of reinsurance assumed or reinsurance ceded must be determined in a manner consistent with OAR 836-031-0200 to 836-031-0300 and also with all applicable provisions of the reinsurance contrac…

836-031-0270 Specific Standards for Morbidity The following standards apply to morbidity: (1) Minimum morbidity standards for valuation of specified benefits provided in individual health insurance policies are as follows: (a) For disability income benefits due to accident or sic…

836-031-0280 Specific Standards for Interest (1) For contract reserves, the maximum interest rate is the maximum rate permitted by law in the valuation of whole life insurance issued on the same date as the health insurance contract. (2) For claim reserves on policies that requir…

836-031-0290 Specific Standards for Mortality (1) Except as provided in section (2) of this rule, the mortality basis used shall be according to any table (but without use of selection factors) permitted by law for the valuation of whole life insurance issued on the same date as …

836-031-0300 Reserves for Waiver of Premium (1) Waiver of premium reserves involves several special considerations. First, the disability valuation tables promulgated by the NAIC are based on exposures that include contracts on premium waiver as in-force contracts. Hence, contrac…

836-031-0400 Allowed Assets For the purpose of applying investment limitations and prohibitions in ORS Chapter 733 that are based upon percentages, the allowed assets of an insurer shall be those allowed assets described in 733.010 that are shown in the financial statement filed …

836-031-0410 Title Insurance Unearned Premium Reserve (1) For the purpose of implementing ORS 733.090(2), the amount of the unearned premium reserve shall be determined as follows for each foreign or alien title insurer relating to policies insuring titles to real property in thi…

836-031-0600 Purpose The purpose of OAR 836-031-0600 to 836-031-0690 is to prescribe: (1) Requirements for statements of actuarial opinion to be submitted in accordance with ORS 733.304 and for memoranda in support thereof; (2) Rules applicable to the appointment of an appointed …

836-031-0605 Valuation Manual (1) For the purpose of complying with Oregon Laws 2015, chapter 547, insurers shall use the Valuation Manual established by the National Association of Insurance Commissioners when establishing reserves using a principle-based valuation. The operativ…

836-031-0610 Authority OAR 836-031-0600 to 836-031-0690 are adopted pursuant to ORS 733.300 to 733.322 generally and 733.304 specifically. Statutory/Other Authority: ORS 731.244 Statutes/Other Implemented: ORS 733.304 History: ID 19-2006, f. & cert. ef. 9-26-06 ID 4-1993, f. 7-27…

836-031-0620 Scope (1) OAR 836-031-0600 to 836-031-0690 apply to all life insurers transacting insurance in this state and to all life insurers that are authorized to reinsure life insurance, annuities or health insurance business in this state OAR 836-031-0600 to 836-031-0690 sh…

836-031-0630 Definitions As used in OAR 836-031-0600 to 836-031-0690: (1) "Actuarial Opinion" means the opinion of an appointed actuary regarding the adequacy of the reserves and related actuarial items based on an asset adequacy analysis in accordance with 836-031-0670 and with …

836-031-0640 General Requirements (1) The following provisions apply to submission of the statement of actuarial opinions: (a) There is to be included on or attached to page 1 of the annual statement for each year beginning with 1992 the statement of an appointed actuary, entitle…

836-031-0670 Statement of Actuarial Opinion Based On an Asset Adequacy Analysis (1) General Description. The statement of actuarial opinion submitted in accordance with this rule must consist of: (a) A paragraph identifying the appointed actuary and the qualifications of the qual…

836-031-0680 Description of Actuarial Memorandum Including an Asset Adequacy Analysis and Regulatory Asset Adequacy Summary (1) General provisions. The following general provisions apply to actuarial memoranda that include an asset adequacy analysis: (a) In accordance with ORS 73…

836-031-0690 Additional Considerations for Analysis (1) Use of Assets Supporting the Interest Maintenance Reserve and the Asset Valuation Reserve. An appropriate allocation of assets in the amount of the Interest Maintenance Reserve (IMR), whether positive or negative, must be us…

836-031-0750 Purpose, Authority and Applicability (1) The purpose of OAR 836-031-0750 to 836-031-0775 is to provide: (a) Tables of select mortality factors and rules for their use; (b) A minimum standard for the valuation of plans with nonlevel premiums or benefits; and (c) A min…

836-031-0755 Applicability OAR 836-031-0750 to 836-031-0775 apply to all life insurance policies, with or without nonforfeiture values, issued on or after January 1, 2000, subject to OAR 836-051-0106 and the following exceptions and conditions: (1) The following exceptions apply:…

836-031-0760 Definitions As used in OAR 836-031-0750 to 836-031-0775: (1) "Basic reserves" means reserves calculated in accordance with ORS 733.306. (2) "Contract segmentation method" means the method of dividing the period from issue to mandatory expiration of a policy into succ…

836-031-0765 General Calculation Requirements for Basic Reserves and Premium Deficiency Reserves (1) At the election of the insurer for any one or more specified plans of life insurance, the minimum mortality standard for basic reserves may be calculated using the 1980 CSO valuat…

836-031-0770 Calculation of Minimum Valuation Standard for Policies with Guaranteed Nonlevel Gross Premiums or Guaranteed Nonlevel Benefits (Other than Universal Life Policies) (1) Basic Reserves. Basic reserves shall be calculated as the greater of the segmented reserves and the…

836-031-0775 Calculation of Minimum Valuation Standard for Flexible Premium and Fixed Premium Universal Life Insurance Policies that Contain Provisions Resulting in the Ability of a Policyowner to Keep a Policy in Force Over a Secondary Guarantee Period (1) The following standard…

836-031-0800 Purpose, authority (1) The purpose of OAR 836-031-0800 to 836-031-0815 is to recognize, permit and prescribe the use of mortality tables that reflect differences in mortality between preferred and standard lives in determining minimum reserve liabilities in accordanc…

836-031-0805 Definitions (1) “2001 CSO Mortality Table” means that mortality table, consisting of separate rates of mortality for male and female lives, developed by the American Academy of Actuaries CSO Task Force from the valuation Basic Mortality Table developed by the Society…