Chapter 744 — Chapter 744
296 sections in this chapter.
ORS 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
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(a) A person licensed under ORS 744.521 to engage in business 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 …
ORS 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
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(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 …
ORS 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]
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[Repealed or reserved.]
ORS 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
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(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]
ORS 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
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(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 ren…
ORS 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]
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[Repealed or reserved.]
ORS 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]
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[Repealed or reserved.]
ORS 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
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(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…
ORS 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
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(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 ag…
ORS 744.722 Relationship of insurer and third party administrator regarding payments. (1) When an insurer uses the services of a third party administrator
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(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 admini…
ORS 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
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(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 c…
ORS 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
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(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]
ORS 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]
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[Repealed or reserved.]
ORS 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
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(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 par…
ORS 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 administrator’s commissions, fees or charges contingent upon savings effected in the adjustment, settlement and payment of losses covered by the obligations of the insurer
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(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 num…
ORS 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
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(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 f…
ORS 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]
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[Repealed or reserved.]
ORS 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
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(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]
ORS 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
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(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 …
ORS 744.800 Qualifications for reinsurance intermediary brokers and managers. (1) For purposes of ORS 744.800 to 744.818
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(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 pers…
ORS 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
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(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 reinsur…
ORS 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
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(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, …
ORS 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
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(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. (…
ORS 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
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(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 732.596. (3) The insurer must annual…
ORS 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
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(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 regard…
ORS 744.812 Prohibitions on actions of reinsurance intermediary managers. A reinsurance intermediary manager may not do any of the following
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(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 re…
ORS 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
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(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…
ORS 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
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(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]
ORS 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
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(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 on…
ORS 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]
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VEHICLE RENTAL COMPANIES
ORS 744.850 Definitions for ORS 744.850 to 744.858. As used in ORS 744.850 to 744.858
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(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 …
ORS 744.852 Limited license for rental companies; application; rules. (1) The Director of the Department of Consumer and Business Services shall adopt rules to specify information that rental companies must submit in applying for a limited license
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(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) After receiving an application, the director may issue a limited …
ORS 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
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(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 result…
ORS 744.856 Conditions for offer or sale of insurance; training; filing officer. (1) A rental company that obtains a limited license under ORS 744.852 may not offer or sell insurance pursuant to ORS 744.854 unless
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(a) The rental agreement is for a period of 90 consecutive days or less. (b) At every location where rental agreements are executed, written material is available to prospective renters that: (A) Summarizes clearly and correctly the material terms of the coverage offered and iden…
ORS 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
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(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 744.8…
ORS 744.860 Definitions for ORS 744.860 to 744.870. As used in ORS 744.860 to 744.870
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(1) “Insurer” means an insurer, a surplus lines insurer or an insurance producer. (2) “Licensee” means an owner that receives a limited license to sell insurance in accordance with ORS 744.860 to 744.870. (3) “Occupant” has the meaning given that term in ORS 87.685. (4) “Owner” h…
ORS 744.862 Limited license to sell insurance; exemption; application; disclosures required; conditions on license. (1)(a) An owner may not sell insurance to an occupant without applying for and receiving a limited license under this section
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(b) An owner does not require a license under this section if the owner displays or makes available materials related to an insurer’s insurance coverage but does not sell the insurance or otherwise benefit from the insurer’s insurance sales. (2) An owner may apply to the Director…
ORS 744.864 Permissible sales; required notices and disclosures; evidence of coverage; prohibition on representing owner as insurer. (1) A licensee may sell insurance only
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(a) Of the type described in subsection (2) of this section; (b) In connection with and incident to renting individual storage space to an occupant at a self-service storage facility; and (c) In accordance with the requirements set forth in subsection (3) of this section. (2) A l…
ORS 744.866 Training program; approval of training materials; certification of training; auditing. (1)(a) A licensee must provide a training program for the licensee’s employees or agents that sell insurance on the licensee’s behalf. The training program must instruct the employees or agents about the coverage the insurance provides and about the provisions of ORS 744.860 to 744.870
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(b) The licensee each year shall submit to the Director of the Department of Consumer and Business Services for the director’s approval an outline of, and copies of materials the licensee uses in, the training program. (c) A licensee each year shall certify to the director that t…
ORS 744.868 License suspension and revocation or other penalty; rules. (1) The Director of the Department of Consumer and Business Services may suspend or revoke a limited license the director issued under ORS 744.862, or may impose another penalty the director prescribes by rule, if
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(a) A licensee sells or offers to sell insurance other than insurance described in ORS 744.864; (b) An owner sells or offers to sell insurance to an occupant without obtaining a limited license in accordance with ORS 744.862; or (c) An owner or licensee violates another provision…
ORS 744.870 Compensation, bonuses and incentives. ORS 744.860 to 744.870 do not prohibit
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(1) An insurer from paying, or a licensee from receiving, a commission, fee or other compensation for selling the insurer’s insurance; or (2) A licensee or owner from paying an employee or agent of the licensee or owner a bonus, incentive payment or other compensation if the bonu…
ORS 744.872 Rules. The Director of the Department of Consumer and Business Services may adopt rules to implement and administer the provisions of ORS 744.860 to 744.870. [2013 c.280 §8]
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[Repealed or reserved.]
ORS 744.990 [Repealed by 1967 c.359 §704]
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PENALTIES
ORS 744.991 Criminal penalties; restitution. (1) Violation of ORS 744.369, in addition to any applicable prescribed denial, suspension or revocation of any license or civil forfeiture, shall be punishable upon conviction as for the crime of theft under ORS 164.015 to 164.135 or the crime of forgery or related offenses under ORS 165.002 to 165.070
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(2) A person convicted of a violation of ORS 744.369 may be ordered to pay restitution to persons aggrieved by the violation of ORS 744.369. Restitution may be ordered in addition to a fine or imprisonment, but not in lieu of a fine or imprisonment. (3) Except for an act under OR…
ORS 744.992 Civil penalties; civil actions; rescission of life settlement contracts. (1) A person who violates any provision of ORS 744.318 to 744.384, 744.991 and 744.992 is subject to civil penalties under ORS 731.988 and cease and desist orders under ORS 731.252
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(2) If a person violates any provision of ORS 744.318 to 744.384, 744.991 and 744.992, the Director of the Department of Consumer and Business Services may seek an injunction in a court of competent jurisdiction and may apply for temporary and permanent orders that the director d…
ORS 744.994 Effect of license expiration or surrender on director’s investigation or disciplinary proceedings. (1) As used in this section
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(a) “Adjuster” has the meaning given that term in ORS 744.502; (b) “Insurance consultant” has the meaning given that term in ORS 744.602; and (c) “Licensee” means a person that has obtained a license to engage in business as an adjuster, an insurance consultant or an insurance pr…