TITLE 56
INSURANCE
Chapter 731. Administration and General Provisions
732. Organization and Corporate Procedures of
Domestic Insurers; Regulation of Insurers Generally
733. Accounting and Investments
734. Rehabilitation, Liquidation and
Conservation of Insurers
735. Alternative Insurance
737. Rates and Rating Organizations
741. Oregon Health Insurance Exchange
742. Insurance Policies Generally; Property and
Casualty Policies
743. Health and Life Insurance
743A. Health Insurance: Required Reimbursements
744. Insurance Producers; Life Settlement
Providers, Brokers and Contracts; Adjusters; Consultants; Third Party
Administrators; Reinsurance Intermediaries; Rental Company Limited Licenses
746. Trade Practices
748. Fraternal Benefit Societies
750. Health Care Service Contractors; Multiple
Employer Welfare Arrangements; Legal Expense Organizations
752. Professional Liability Funds
_______________
Chapter 731 — Administration
and General Provisions
2011 EDITION
ADMINISTRATION AND GENERAL PROVISIONS
INSURANCE
SHORT TITLE; PURPOSE AND CONSTRUCTION
731.004 Short
title
731.008 Purpose
of Insurance Code
731.012 Effect
of federal law
731.016 Construction
of Insurance Code
APPLICATION OF INSURANCE CODE
731.022 Compliance
with Insurance Code required
731.026 Application
of Insurance Code to particular insurers
731.028 Applicability
of certain Insurance Code provisions to State Accident Insurance Fund
Corporation
731.036 Persons
completely exempt from application of Insurance Code
731.038 Application
of Insurance Code to charitable organizations that issue charitable gift
annuities
731.039 Requirements
for certain educational institutions or nonprofit corporations issuing
charitable gift annuities
731.042 Certificate
of exemption; application of certain Insurance Code provisions to exempt
insurers
731.046 Exemption
of policies from Securities Law
DEFINITIONS GENERALLY
731.052 Insurance
Code definitions
731.056 “Action”
731.066 “Authorized,”
“unauthorized” insurer
731.069 “Certificate,”
“certificate holder”
731.072 “Certificate
of authority,” “license”
731.074 “Commercial
liability insurance”
731.075 “Covered
life”
731.076 “Department,”
“director”
731.082 “Domestic,”
“foreign,” “alien” insurer
731.086 “Domestic
risk”
731.092 “Domicile”
731.096 “Domicile
of alien insurer”
731.099 “Independently
procured insurance”
731.102 “Insurance”
731.104 “Insurance
producer”
731.106 “Insurer”
731.112 “Judgment”
731.116 “Person”
731.122 “Policy”
731.126 “Reinsurance”
731.132 “Required
capitalization”
731.136 “State”
731.142 “Stock,”
“mutual” and “reciprocal” insurer
731.144 “Surplus
lines insurance”
731.146 “Transact
insurance”
CLASSES OF INSURANCE DEFINED
731.150 Definitions
of classes of insurance not mutually exclusive
731.154 “Annuity”
731.156 “Variable
life insurance”; “variable annuity”
731.158 “Casualty
insurance”
731.162 “Health
insurance”
731.164 “Home
protection insurance,” “home protection insurer”
731.166 “Industrial
life insurance”
731.170 “Life
insurance”; includes annuities
731.174 “Marine
and transportation insurance”
731.178 “Mortgage
insurance”
731.182 “Property
insurance”
731.186 “Surety
insurance”
731.190 “Title
insurance”
731.194 “Wet
marine and transportation insurance”
INSURANCE ADMINISTRATION
731.216 Administrative
power of director
731.228 Prohibited
interests and rewards
731.232 Subpoena
power
731.236 General
powers and duties
731.240 Hearings
in general
731.244 Rules
731.248 Orders
731.252 Cease
and desist orders
731.256 Enforcement
generally
731.258 Enforcement
of orders and decisions by Attorney General; filing, enforcement and effect of
foreign decrees
731.260 False
or misleading filings
731.264 Complaints
and investigations confidential; permitted disclosures; rules
731.268 Use
of reproductions and certified copies as evidence; fee
731.272 Director’s
annual reports; notice of publication of report
731.276 Recommendations
for changes in Insurance Code
731.280 Publications
authorized
731.282 Authority
to sell publications
731.284 Distribution
of insurance laws
731.288 Recording
complaints; director to consider complaints before issuing licenses
731.292 Disposition
of fees, charges, taxes, penalties and other moneys
731.296 Director’s
inquiries
731.300 Examination
of insurers; when required
731.302 Appointment
of examiners; retaining of appraisers, actuaries and others; evidentiary status
of facts and conclusions
731.304 Investigation
of persons transacting insurance
731.308 Procedure
at examination or investigation; production of books and other records
731.312 Report
of examination; review by person examined; hearing; confidentiality of certain
information and documents; permitted disclosures
731.314 Immunity
for director, examiner and others
731.316 Expenses
of examination of insurer
731.324 Service
of process on Secretary of State; notice to unauthorized insurer
731.328 Deposits
by unauthorized insurers in actions or proceedings
AUTHORIZATION OF INSURERS AND GENERAL
REQUIREMENTS
731.354 Certificate
of authority required
731.356 Unauthorized
insurance transaction enforcement
731.358 Requirements
of domestic insurers generally
731.362 Requirements
of foreign or alien insurers generally
731.363 Authorized
foreign insurer becoming domestic insurer
731.364 Domestic
insurer transferring domicile to another state
731.365 Effect
of transfer of domicile by domestic or foreign insurer; notice to director by
transferring insurer
731.367 Transfer
of domicile by unincorporated authorized foreign insurer
731.369 Requirements
of reciprocal insurers generally
731.370 Reciprocal
insurer’s financial statement; service of process
731.371 Powers
of reciprocal insurer regarding real estate
731.374 Exemptions
to certificate of authority requirement
731.378 Foreign
and alien insurers exempt from laws governing admission of foreign and alien
corporations
731.380 Authority
of foreign and alien insurers to take, acquire, hold and enforce notes secured
by mortgages; statement; fees
731.381 Exemption
from taxes for foreign and alien insurers engaging in activities authorized by
ORS 731.380
731.382 General
eligibility for certificate of authority
731.385 Standards
for determining whether continued operation of insurer is hazardous; rules;
order; hearing
731.386 Management
of insurers
731.390 Government
insurers not to be authorized
731.394 Combinations
of insuring powers in one insurer
731.396 Certificate
of authority and good financial condition required to issue variable life
insurance or variable annuity policies
731.398 Amendment
of certificate of authority
731.402 Issuance
or refusal of certificate of authority
731.406 What
certificate evidences; ownership of certificate
731.410 Continuance,
expiration or reinstatement of certificate of authority
731.414 Suspension
or revocation of certificate of authority; mandatory grounds
731.418 Grounds
for suspension or revocation of certificate of authority
731.422 Order
of suspension, revocation or refusal; effect upon insurance producers’
authority
731.426 Duration
of suspension; insurer’s obligations during suspension period; reinstatement
731.428 Written
consent to engage or participate in business of insurance; rules
731.430 Name
of insurer
731.434 Registered
office and agent
731.438 Title
plant requirement for title insurers; posting of indexes; plant ownership and
maintenance
731.439 Satisfaction
of requirements of ORS 731.438 (1) by certain title plants
731.442 Prohibition
on transacting life insurance business on mutual assessment plan
731.446 Policyholder
deposits
731.450 Unrelated
business prohibited; exceptions; title insurer as escrow agent
731.454 Domestic
insurers not to transact business in jurisdiction where not authorized
731.458 Exchange
of reciprocal or interinsurance contracts
731.462 Nonassessable policies of reciprocal insurer
731.466 Power
of attorney for reciprocal insurer
731.470 Attorney
for reciprocal insurer
731.475 Records
storage required of workers’ compensation insurers; examination and audit of
records
731.480 Workers’
compensation policies; conditions for issuing
731.482 Withdrawal
from, failure to renew or cancellation of line by commercial liability insurer
731.484 Prohibition
on certain sales related to group health and group life insurance
731.485 Conditions
under which insurer may limit insured’s choice of drug outlets and pharmacies
731.486 Exemption
from definition of “transact insurance” for group life policies; master group
health insurance coverage; rules
731.488 Annual
audit of insurer; rules
LIMIT OF RISK; REINSURANCE
731.504 Limit
of risk
731.508 Approved
reinsurance
731.509 Legislative
intent; criteria for allowing credit for reinsurance
731.510 Criteria
for allowing reduction from liability for reinsurance
731.511 Criteria
to be met by assuming insurer in order to be accredited as reinsurer
731.512 Withdrawal
of insurer; reinsurance
731.516 Mortgage
insurance limitation; waiver of limitation; rules; fees
CAPITAL AND SURPLUS
731.554 Capital
and surplus requirements
731.562 Title
insurer capital and surplus requirements
731.566 Reciprocal
insurer surplus requirements
731.570 Withdrawing
advancements made to reciprocal insurer
731.574 Annual
financial statement
REPORTS OF CRIMINAL CONDUCT
731.590 “Insurer”
defined for ORS 731.592 and 731.594
731.592 Reporting
criminal conduct involving insurance
731.594 Immunity
from civil liability
DEPOSITS
731.604 Acceptance
of deposits of insurers
731.608 Purpose
of deposit
731.612 Rights
of insurer regarding deposits
731.616 Valuation
of deposits; deficiencies
731.620 Assignment
of deposited securities
731.624 Special
deposits; foreign and alien insurers
731.628 Deposit
required of workers’ compensation insurers
731.632 Deposit
required of domestic reciprocal insurers; exception
731.636 Deposit
or trusteed assets of alien insurer required
731.640 Eligible
deposits; rules
731.642 Contracts
for security deposits
731.644 Payment
of losses out of deposits, generally
731.648 Duration
and release of deposit
731.652 Proofs
for release of deposit to insurers; director’s responsibility
EXCHANGE OF INFORMATION BY REGULATORS
731.730 Insurer
filings with National Association of Insurance Commissioners
731.731 Immunity
for certain persons dealing with information collected from filings under ORS
731.730
731.735 Certain
information confidential
731.737 Immunity
from liability for certain persons filing reports or furnishing information
about specified activities to specified persons
CONFIDENTIALITY OF REPORTS
731.750 Confidentiality
of report of material acquisitions or dispositions of assets, material nonrenewals, cancellations and revisions of ceded
reinsurance agreements
731.752 Confidentiality
of report used for determination of required amount of capital or surplus;
confidentiality of financial plan of action and report of examination connected
with plan
731.754 Permissible
uses of reports and plans described in ORS 731.752
INSURANCE COMPLIANCE AUDIT REPORTS
731.760 Definitions
for ORS 731.760 to 731.770
731.761 Privileged
information
731.762 Authority
of director
731.764 Waiver
of privilege; permitted disclosures
731.766 Petition
for in camera hearing; hearing; compelled disclosure
731.768 Privilege;
exceptions
731.770 Other
privileges or limitations pertaining to audit document
ASSESSMENTS, FEES AND TAXES
731.804 Assessments;
rules; fees; how determined
731.808 “Gross
amount of premiums” defined
731.812 Foreign
and alien insurer’s report of Oregon business
731.820 Gross
premium tax on fire insurance premiums
731.822 Prepayment
of tax due
731.824 Tax
on underwriting profits of wet marine and transportation insurers
731.828 Computation
of wet marine and transportation insurance tax
731.836 Limitation
on enforcement of insurer’s tax obligations
731.840 Retaliatory
or corporate excise tax in lieu of certain taxes; certain local taxes
prohibited
731.841 Conditions
under which local authority to tax insurer is preempted
731.842 Adjustment
of amount to be prepaid for taxes; extension of time for payment; interest;
penalty for late payment
731.844 No
personal liability for paying invalid tax
RETALIATORY PROVISIONS
731.854 Retaliatory
tax
731.859 Applicability
of retaliatory provisions
MISCELLANEOUS
731.870 State
of emergency; effect upon insurance policies; rules
PENALTIES
731.988 Civil
penalties
731.992 Criminal
penalty
SHORT TITLE; PURPOSE AND CONSTRUCTION
731.004 Short title.
ORS chapters 731, 732, 733, 734, 735, 737, 742, 743, 743A, 744, 746, 748 and
750 may be cited as the Insurance Code. [1967 c.359 §1; 1973 c.97 §1; 1975
c.769 §1]
731.008 Purpose of Insurance Code.
The Legislative Assembly declares that the Insurance Code is for the protection
of the insurance-buying public. [Formerly 736.003]
731.010
[Repealed by 1965 c.241 §3]
731.012 Effect of federal law.
The Insurance Code shall regulate the business of insurance and every person
engaged therein in accordance with the intent of Congress as expressed in the
Act of March 9, 1945, as amended (Public Law 15, 79th Congress, 15 U.S.C. 1011
to 1014) which states in part that no Act of Congress shall be construed to
invalidate, impair or supersede any law enacted by any state for the purpose of
regulating the business of insurance, or which imposes a fee or tax upon such
business, unless such Act specifically relates to the business of insurance. [1967
c.359 §3]
731.016 Construction of Insurance Code.
The Insurance Code shall be liberally construed and shall be administered and
enforced by the Director of the Department of Consumer and Business Services to
give effect to the policy stated in ORS 731.008. [1967 c.359 §4]
731.020
[Repealed by 1965 c.241 §3]
APPLICATION OF INSURANCE CODE
731.022 Compliance with Insurance Code
required. No person shall transact insurance in
this state or relative to a domestic risk without complying with the applicable
provisions of the Insurance Code. [1967 c.359 §5]
731.026 Application of Insurance Code to
particular insurers. The Insurance Code applies to:
(1)
A fraternal benefit society complying with ORS chapter 748, only as provided in
such chapter.
(2)
A health care service contractor complying with ORS 750.005 to 750.095, only as
provided in such sections.
(3)
A legal expense organization complying with ORS 750.505 to 750.715, only as
provided in such sections.
(4)
A multiple employer welfare arrangement complying with ORS 750.301 to 750.341,
only as provided in such sections. [1967 c.359 §6; 1971 c.425 §1; 1973 c.97 §2;
1975 c.769 §2; 1989 c.331 §23; 1993 c.265 §2; 1993 c.615 §26; 2005 c.31 §6]
731.028 Applicability of certain Insurance
Code provisions to State Accident Insurance Fund Corporation.
(1) The State Accident Insurance Fund Corporation is subject as a domestic
insurer to ORS 731.248, 731.252, 731.256, 731.258, 731.260, 731.296 to 731.316,
731.488, 731.574, 731.592, 731.594, 731.730, 731.731, 731.735, 731.737,
731.870, 731.988, 731.992, 733.010 to 733.060, 733.140 to 733.170, 733.210,
737.205, 737.215, 737.225, 737.235 to 737.340, 737.505 and 737.560, ORS
chapters 742, 743, 743A and 744 and ORS 746.015, 746.075, 746.110, 746.145 to
746.155, 746.230 and 746.240. However:
(a)
The requirements of the Director of the Department of Consumer and Business
Services under ORS 733.010 to 733.060, 733.140 to 733.170 and 733.210 govern in
the case of a conflict between those requirements and the requirements of any
accounting system prescribed by the Oregon Department of Administrative
Services.
(b)
The filing requirements of ORS 737.205 to 737.340, 737.505 and 737.560 are in
lieu of any similar filing requirements prescribed by any other law of this
state.
(c)
The requirements of ORS chapters 743 and 743A are applicable only with respect
to excess workers’ compensation insurance furnished by the corporation.
(d)
The provisions of ORS chapter 744 apply only with respect to the regulation of
insurance producers.
(e)
For each year that the Secretary of State conducts an audit of the State
Accident Insurance Fund Corporation under ORS 297.210, the director may accept
the audit and a copy of the Secretary of State’s audit report in lieu of the requirements
of ORS 731.488 if the director determines that the purposes of ORS 731.488 are
adequately served by the Secretary of State’s audit and report. The Secretary
of State shall file a copy of its audit report of the State Accident Insurance
Fund Corporation with the director.
(2)
The provisions of subsection (1) of this section govern in the case of a
conflict between those provisions and the provisions of ORS chapter 656 that
apply only to the State Accident Insurance Fund Corporation. [1971 c.385 §2;
1977 c.405 §5; 1979 c.815 §7; 1979 c.829 §7; 1987 c.884 §4; 1989 c.701 §69;
1991 c.340 §1; 1991 c.401 §31; 1993 c.447 §116; 1995 c.79 §356; 1999 c.633 §5;
2003 c.364 §63; 2003 c.689 §1; 2008 c.22 §3]
731.030
[Repealed by 1965 c.241 §3]
731.032 [1967
c.359 §7; 1971 c.69 §1; 1971 c.538 §1; 1979 c.848 §1; 1993 c.265 §3; repealed
by 2003 c.802 §173]
731.036 Persons completely exempt from
application of Insurance Code. Except as
provided in ORS 743.061 or as specifically provided by law, the Insurance Code
does not apply to any of the following to the extent of the subject matter of
the exemption:
(1)
A bail bondsman, other than a corporate surety and its agents.
(2)
A fraternal benefit society that has maintained lodges in this state and other
states for 50 years prior to January 1, 1961, and for which a certificate of
authority was not required on that date.
(3)
A religious organization providing insurance benefits only to its employees, if
the organization is in existence and exempt from taxation under section
501(c)(3) of the federal Internal Revenue Code on September 13, 1975.
(4)
Public bodies, as defined in ORS 30.260, that either individually or jointly
establish a self-insurance program for tort liability in accordance with ORS
30.282.
(5)
Public bodies, as defined in ORS 30.260, that either individually or jointly
establish a self-insurance program for property damage in accordance with ORS
30.282.
(6)
Cities, counties, school districts, community college districts, community
college service districts or districts, as defined in ORS 198.010 and 198.180,
that either individually or jointly insure for health insurance coverage,
excluding disability insurance, their employees or retired employees, or their
dependents, or students engaged in school activities, or combination of
employees and dependents, with or without employee or student contributions, if
all of the following conditions are met:
(a)
The individual or jointly self-insured program meets the following minimum
requirements:
(A)
In the case of a school district, community college district or community
college service district, the number of covered employees and dependents and
retired employees and dependents aggregates at least 500 individuals;
(B)
In the case of an individual public body program other than a school district,
community college district or community college service district, the number of
covered employees and dependents and retired employees and dependents
aggregates at least 500 individuals; and
(C)
In the case of a joint program of two or more public bodies, the number of
covered employees and dependents and retired employees and dependents
aggregates at least 1,000 individuals;
(b)
The individual or jointly self-insured health insurance program includes all coverages and benefits required of group health insurance
policies under ORS chapters 743 and 743A;
(c)
The individual or jointly self-insured program must have program documents that
define program benefits and administration;
(d)
Enrollees must be provided copies of summary plan descriptions including:
(A)
Written general information about services provided, access to services,
charges and scheduling applicable to each enrollee’s coverage;
(B)
The program’s grievance and appeal process; and
(C)
Other group health plan enrollee rights, disclosure or written procedure
requirements established under ORS chapters 743 and 743A;
(e)
The financial administration of an individual or jointly self-insured program
must include the following requirements:
(A)
Program contributions and reserves must be held in separate accounts and used
for the exclusive benefit of the program;
(B)
The program must maintain adequate reserves. Reserves may be invested in
accordance with the provisions of ORS chapter 293. Reserve adequacy must be
calculated annually with proper actuarial calculations including the following:
(i) Known claims, paid and outstanding;
(ii)
A history of incurred but not reported claims;
(iii)
Claims handling expenses;
(iv)
Unearned contributions; and
(v)
A claims trend factor; and
(C)
The program must maintain adequate reinsurance against the risk of economic
loss in accordance with the provisions of ORS 742.065 unless the program has
received written approval for an alternative arrangement for protection against
economic loss from the Director of the Department of Consumer and Business
Services;
(f)
The individual or jointly self-insured program must have sufficient personnel
to service the employee benefit program or must contract with a third party
administrator licensed under ORS chapter 744 as a third party administrator to
provide such services;
(g)
The individual or jointly self-insured program shall be subject to assessment
in accordance with ORS 735.614 and former enrollees shall be eligible for
portability coverage in accordance with ORS 735.616;
(h)
The public body, or the program administrator in the case of a joint insurance
program of two or more public bodies, files with the Director of the Department
of Consumer and Business Services copies of all documents creating and
governing the program, all forms used to communicate the coverage to
beneficiaries, the schedule of payments established to support the program and,
annually, a financial report showing the total incurred cost of the program for
the preceding year. A copy of the annual audit required by ORS 297.425 may be
used to satisfy the financial report filing requirement; and
(i) Each public body in a joint insurance program is liable
only to its own employees and no others for benefits under the program in the
event, and to the extent, that no further funds, including funds from insurance
policies obtained by the pool, are available in the joint insurance pool.
(7)
All ambulance services.
(8)
A person providing any of the services described in this subsection. The
exemption under this subsection does not apply to an authorized insurer
providing such services under an insurance policy. This subsection applies to
the following services:
(a)
Towing service.
(b)
Emergency road service, which means adjustment, repair or replacement of the
equipment, tires or mechanical parts of a motor vehicle in order to permit the
motor vehicle to be operated under its own power.
(c)
Transportation and arrangements for the transportation of human remains,
including all necessary and appropriate preparations for and actual
transportation provided to return a decedent’s remains from the decedent’s
place of death to a location designated by a person with valid legal authority
under ORS 97.130.
(9)(a)
A person described in this subsection who, in an agreement to lease or to
finance the purchase of a motor vehicle, agrees to waive for no additional
charge the amount specified in paragraph (b) of this subsection upon total loss
of the motor vehicle because of physical damage, theft or other occurrence, as
specified in the agreement. The exemption established in this subsection
applies to the following persons:
(A)
The seller of the motor vehicle, if the sale is made pursuant to a motor
vehicle retail installment contract.
(B)
The lessor of the motor vehicle.
(C)
The lender who finances the purchase of the motor vehicle.
(D)
The assignee of a person described in this paragraph.
(b)
The amount waived pursuant to the agreement shall be the difference, or portion
thereof, between the amount received by the seller, lessor,
lender or assignee, as applicable, that represents the actual cash value of the
motor vehicle at the date of loss, and the amount owed under the agreement.
(10)
A self-insurance program for tort liability or property damage that is
established by two or more affordable housing entities and that complies with
the same requirements that public bodies must meet under ORS 30.282 (6). As
used in this subsection:
(a)
“Affordable housing” means housing projects in which some of the dwelling units
may be purchased or rented, with or without government assistance, on a basis
that is affordable to individuals of low income.
(b)
“Affordable housing entity” means any of the following:
(A)
A housing authority created under the laws of this state or another
jurisdiction and any agency or instrumentality of a housing authority,
including but not limited to a legal entity created to conduct a self-insurance
program for housing authorities that complies with ORS 30.282 (6).
(B)
A nonprofit corporation that is engaged in providing affordable housing.
(C)
A partnership or limited liability company that is engaged in providing
affordable housing and that is affiliated with a housing authority described in
subparagraph (A) of this paragraph or a nonprofit corporation described in
subparagraph (B) of this paragraph if the housing authority or nonprofit
corporation:
(i) Has, or has the right to acquire, a financial or
ownership interest in the partnership or limited liability company;
(ii)
Has the power to direct the management or policies of the partnership or
limited liability company;
(iii)
Has entered into a contract to lease, manage or operate the affordable housing
owned by the partnership or limited liability company; or
(iv)
Has any other material relationship with the partnership or limited liability
company.
(11)
A community-based health care initiative approved by the Administrator of the
Office for Oregon Health Policy and Research under ORS 735.723 operating a
community-based health care improvement program approved by the administrator.
(12)
Except as provided in ORS 735.500 and 735.510, a person certified by the
Department of Consumer and Business Services to operate a retainer medical
practice. [1967 c.359 §8; 1975 c.314 §1; 1977 c.428 §4; 1981 c.891 §1; 1985
c.811 §1; 1987 c.97 §1; 1987 c.288 §1; 1991 c.958 §2; 1993 c.265 §4; 1995 c.79 §357;
1995 c.582 §1; 1995 c.629 §1; 1997 c.795 §3; 1999 c.502 §4; 2003 c.342 §1; 2005
c.175 §1; 2007 c.174 §1; 2007 c.826 §1; 2009 c.244 §1; 2009 c.470 §5; 2009
c.867 §48; 2011 c.9 §90; 2011 c.130 §6; 2011 c.499 §4]
731.038 Application of Insurance Code to
charitable organizations that issue charitable gift annuities.
(1) As used in this section:
(a)
“Charitable gift annuity” has the meaning given that term in section 501(m)(5)
of the Internal Revenue Code, as amended and in effect on January 1, 2006.
(b)
“Charitable organization” means an organization to which contributions may be
made that are charitable contributions under section 170(c) of the Internal
Revenue Code, as amended and in effect on January 1, 2006.
(2)
The Insurance Code does not apply to a charitable organization that issues
charitable gift annuities if, on the date that the charitable organization
issues the charitable gift annuity, the charitable organization:
(a)
Has a minimum of $300,000 in net assets as shown by an annual audited financial
statement prepared by an independent certified public accountant and kept on
file by the charitable organization;
(b)
Except as provided in subsection (3) of this section, has been in continuous
operation for at least five years or is a successor to or an affiliate of a
charitable organization that has been in continuous operation for at least five
years; and
(c)
Maintains a separate and distinct trust fund as a reserve fund adequate to meet
the future payments under all outstanding annuity agreements. The amount in the
reserve fund must be an amount no less than an amount computed on the basis of
the transfers to which it relates in accordance with the standard of valuation
based on current mortality tables and interest rate recommended by a national
organization organized for the purpose of providing educational and other
services to American charities regarding gift annuities and other forms of
planned gifts. The reserve fund may include one or more single premium
annuities that pay the entire amount of one or more charitable gift annuities
issued by the charitable organization if each single premium annuity is issued
by an authorized insurer that is also authorized to transact insurance in the
state in which the charitable organization has its principal office and in the
state in which the single premium annuity is issued.
(3)
The Insurance Code does not apply to an educational institution or nonprofit
corporation that issued a charitable gift annuity before January 1, 2006, under
a certificate of authority issued under ORS 731.704 (repealed in 2005).
(4)
When a charitable organization that is subject to subsection (2) of this
section enters into an agreement for a charitable gift annuity, the charitable
organization shall disclose in writing to the donor that the charitable gift
annuity is not issued by an insurance company, is not subject to regulation by
the State of Oregon and is not protected by an insurance guaranty association.
(5)
A charitable organization that is not subject to subsection (2) of this section
must hold a certificate of authority to issue charitable gift annuities. [2005
c.31 §2]
Note:
731.038 was added to and made a part of the Insurance Code by legislative
action but was not added to ORS chapter 731 or any series therein. See Preface
to Oregon Revised Statutes for further explanation.
731.039 Requirements for certain educational
institutions or nonprofit corporations issuing charitable gift annuities.
ORS 731.038 (2)(a) and (b) does not apply to an educational institution or
nonprofit corporation that holds a certificate of authority issued under ORS
731.704 (repealed in 2005) on the day before January 1, 2006. An educational
institution or nonprofit corporation subject to this section shall keep on file
an annual audited financial statement prepared by an independent certified
public accountant. [2005 c.31 §3]
Note: 731.039
was enacted into law by the Legislative Assembly but was not added to or made a
part of ORS chapter 731 or any series therein by legislative action. See
Preface to Oregon Revised Statutes for further explanation.
731.040
[Repealed by 1965 c.241 §3]
731.042 Certificate of exemption;
application of certain Insurance Code provisions to exempt insurers.
(1) An exempt insurer who holds a certificate of exemption issued by the
Director of the Department of Consumer and Business Services before January 1, 2003,
may continue transacting insurance.
(2)
In order to continue a certificate of exemption, an exempt insurer to whom
subsection (1) of this section applies must file its annual statement and pay
the fees established by the director by March 1 of each year.
(3)
An exempt insurer shall be subject to ORS 731.296 to 731.316, 731.414, 731.418,
731.574, 731.988, 731.992, 733.010 to 733.115, 733.140 to 733.210, 743A.040,
746.075 and 746.110. [Formerly 736.020; 1979 c.870 §1; 1981 c.752 §15; 1989
c.413 §2; 2003 c.802 §174; 2005 c.22 §485]
731.046 Exemption of policies from
Securities Law. Any policy, other than a
variable annuity policy, whose form has been filed with and approved by the
Director of the Department of Consumer and Business Services is exempt from the
application of ORS 59.005 to 59.451, 59.710 to 59.830, 59.991 and 59.995, and
the marketing of such policy is likewise exempt. [1967 c.359 §10; 2007 c.393 §2]
731.050
[Repealed by 1965 c.241 §3]
DEFINITIONS GENERALLY
731.052 Insurance Code definitions.
Except where the context otherwise requires, the definitions given in the
Insurance Code govern its construction. [1967 c.359 §11]
731.056 “Action.”
“Action” means any action, suit or legal proceeding. [1967 c.359 §12]
731.060
[Repealed by 1965 c.241 §3]
731.062 [1967
c.359 §13; 1991 c.810 §1; 2001 c.191 §20; 2003 c.364 §1; renumbered 731.104 in
2003]
731.066 “Authorized,” “unauthorized”
insurer. (1) An “authorized” insurer is one
authorized by a subsisting certificate of authority to transact insurance in
this state.
(2)
An “unauthorized” insurer is one not so authorized. [1967 c.359 §14]
731.069 “Certificate,” “certificate
holder.” (1) “Certificate” means a written
statement evidencing the coverage of a person insured under a group insurance
policy.
(2)
“Certificate holder” means an employee or member of a group insured under a
group insurance policy. [1981 c.752 §11]
731.070
[Repealed by 1965 c.241 §3]
731.072 “Certificate of authority,” “license.”
(1) A “certificate of authority” is one issued by the Director of the
Department of Consumer and Business Services pursuant to the Insurance Code
evidencing the authority of an insurer to transact insurance in this state.
(2)
A “license” is authority granted by the director pursuant to the Insurance Code
for the licensee to engage in a business or operation of insurance in this
state other than as an insurer, and the certificate by which such authority is
evidenced. [1967 c.359 §15]
731.074 “Commercial liability insurance.”
(1) “Commercial liability insurance” means insurance for a business,
professional, nonprofit or governmental entity against legal, contractual or
assumed liability for death, injury or disability of any human, or for damage
to property, arising out of acts or omissions in the course of the conduct of
the entity.
(2)
“Commercial liability insurance” does not include the following lines of
insurance or classes of business:
(a)
Marine and transportation insurance;
(b)
Wet marine and transportation insurance;
(c)
FAIR plans and automobile assigned risk insurance;
(d)
Workers’ compensation and employers’ liability insurance;
(e)
Nuclear liability insurance;
(f)
Fidelity and surety insurance;
(g)
Hazardous waste and environmental impairment insurance;
(h)
Aviation insurance; or
(i) Commercial automobile insurance.
(3)
As used in this section, “commercial automobile” means a four wheel passenger
or station wagon type of vehicle used as a public or private conveyance,
including a motor vehicle of the utility, pickup, sedan delivery or panel truck
type used for wholesale or retail delivery, and a farm truck. [1987 c.774 §32]
Note:
731.074 was added to and made a part of the Insurance Code but was not added to
ORS chapter 731 or any series therein by legislative action. See Preface to
Oregon Revised Statutes for further explanation.
731.075 “Covered life.”
“Covered life” means a subscriber, policyholder, certificate holder, spouse,
dependent child or any other individual insured under an insurance policy or
whose benefits are administered by a third party administrator licensed under
ORS 744.702. [2009 c.595 §1194]
Note:
731.075 was added to and made a part of the Insurance Code by legislative
action but was not added to ORS chapter 731 or any series therein. See Preface
to Oregon Revised Statutes for further explanation.
731.076 “Department,” “director.”
(1) “Department” means the Department of Consumer and Business Services.
(2)
“Director” means the Director of the Department of Consumer and Business
Services. [1967 c.359 §16; 1987 c.373 §76; 1993 c.744 §28]
731.080
[Repealed by 1965 c.241 §3]
731.082 “Domestic,” “foreign,” “alien”
insurer. (1) “Domestic insurer” means an insurer
formed under the laws of this state.
(2)
“Foreign insurer” means an insurer formed under the laws of a state other than
this state.
(3)
“Alien insurer” means an insurer formed under the laws of any country other
than the United States of America or a state thereof. [1967 c.359 §17]
731.086 “Domestic risk.”
“Domestic risk” means a subject of insurance resident, located or to be
performed in this state. [1967 c.359 §18]
731.090
[Repealed by 1965 c.241 §3]
731.092 “Domicile.”
The “domicile” of an insurer means:
(1)
As to insurers formed under the laws of Canada or any province thereof, the
province in which the insurer’s head office is located.
(2)
As to other alien insurers, as provided in ORS 731.096.
(3)
As to all other insurers, the state under the laws of which the insurer was
formed or, if the insurer has been redomesticated to
another state, the state to which it has been redomesticated.
[1967 c.359 §19; 1995 c.639 §13]
731.096 “Domicile of alien insurer.”
(1) The domicile of an alien insurer, other than insurers formed under the laws
of Canada or a province thereof, shall be that state designated by the insurer
in writing filed with the Director of the Department of Consumer and Business
Services at time of admission to this state or before January 1, 1962,
whichever date is the later, and may be any one of the following states:
(a)
The state in which the insurer was first authorized to transact insurance;
(b)
The state in which is located the insurer’s principal place of business in the
United States; or
(c)
The state in which is held the largest deposit of assets of the insurer in
trust for the protection of its policyholders and creditors in the United
States.
(2)
If the insurer makes no such designation its domicile shall be deemed to be
that state in which is located its principal place of business in the United States.
[Formerly 736.240]
731.099 “Independently procured insurance.”
“Independently procured insurance” means insurance procured directly by an
insured from a nonadmitted insurer as defined in ORS
735.405. [2011 c.660 §2]
Note:
731.099 was added to and made a part of ORS chapter 731 by legislative action
but was not added to any smaller series therein. See Preface to Oregon Revised
Statutes for further explanation.
731.100
[Repealed by 1965 c.241 §3]
731.102 “Insurance.”
(1) “Insurance” means a contract whereby one undertakes to indemnify another or
pay or allow a specified or ascertainable amount or benefit upon determinable
risk contingencies.
(2)
“Insurance” so defined includes annuities.
(3)
“Insurance” so defined includes a contract under which one other than a
manufacturer, builder, seller or lessor of the
subject property undertakes to perform or provide, for a fixed term and
consideration, repair or replacement service or indemnification therefor for the operational or structural failure of
specified real or personal property or property components.
Insurance does not include contracts
with a telecommunications utility as defined in ORS 759.005, for repair,
replacement or maintenance of customer-owned inside wiring. [1967 c.359 §21;
1981 c.247 §1; 1985 c.633 §5; 1987 c.447 §111]
731.104 “Insurance producer.”
“Insurance producer” means a person required to be licensed under the laws of
this state to sell, solicit or negotiate insurance. For purposes of this
definition:
(1)
“Negotiate” means to confer directly with or to offer advice directly to a
purchaser or prospective purchaser of a particular policy of insurance
concerning any of the substantive benefits, terms or conditions of the policy,
if the person engaged in that act:
(a)
Sells insurance; or
(b)
Obtains insurance from insurers for purchasers.
(2)
“Sell” means to exchange a policy of insurance by any means, for money or its
equivalent, on behalf of an insurer.
(3)
“Solicit” means to attempt to sell a policy of insurance or to ask or urge a
person to apply for a particular kind of insurance from a particular insurer. [Formerly
731.062]
731.106 “Insurer.”
“Insurer” includes every person engaged in the business of entering into
policies of insurance. [1967 c.359 §22]
731.110 [Repealed
by 1965 c.241 §3]
731.112 “Judgment.”
“Judgment” includes a final order. [1967 c.359 §23; 2003 c.576 §553]
731.116 “Person.”
“Person” means an individual or a business entity. For the purpose of this
definition, “business entity” means a corporation, association, partnership,
limited liability company, limited liability partnership or other legal entity.
[1967 c.359 §24; 1983 c.327 §12; 2001 c.191 §21]
731.120
[Repealed by 1965 c.241 §3]
731.122 “Policy.”
“Policy” means the written contract or written agreement for or effecting
insurance, by whatever name called, and includes all clauses, riders, indorsements and papers which are a part thereof and
annuities. [1967 c.359 §25]
731.126 “Reinsurance.”
“Reinsurance” means a contract under which an originating insurer, called the “ceding”
insurer, procures insurance for itself in another insurer, called the “assuming”
insurer or the “reinsurer,” with respect to part or all of an insurance risk of
the originating insurer. [1967 c.359 §26]
731.130
[Repealed by 1965 c.241 §3]
731.132 “Required capitalization.”
“Required capitalization” means the minimum combined paid-up capital and
surplus required by the Insurance Code of a stock insurer, or the minimum
surplus so required of an insurer without capital stock. [1967 c.359 §27]
731.136 “State.”
When used in context signifying a jurisdiction other than the State of Oregon, “state”
means any state, district, territory, commonwealth or possession of the United
States of America. [1967 c.359 §28; 2001 c.191 §22]
731.140
[Repealed by 1965 c.241 §3]
731.142 “Stock,” “mutual” and “reciprocal”
insurer. (1) “Stock insurer” means an
incorporated insurer whose capital is divided into shares and owned by its
stockholders.
(2)
“Mutual insurer” means an incorporated insurer without capital stock and the
governing body of which is elected by its policyholders. This definition does
not exclude as a “mutual insurer” a foreign insurer found by the Director of
the Department of Consumer and Business Services to be organized on the mutual
plan under the laws of its domicile, but having temporary share capital or
providing for election of the insurer’s governing body on a reasonable basis by
policyholders and others.
(3)
“Reciprocal insurer” means an unincorporated aggregation of persons known as “subscribers,”
operating individually and collectively through an attorney in fact common to
all such persons, interexchanging among themselves
reciprocal agreements of indemnity. [1967 c.359 §29]
731.144 “Surplus lines insurance.”
“Surplus lines insurance” means any insurance on an Oregon home state risk,
permitted to be placed through a surplus lines licensee with a nonadmitted insurer eligible to accept such insurance,
other than reinsurance, wet marine and transportation insurance, independently
procured insurance, life insurance and health insurance and annuities. For
purposes of this section, “home state” has the meaning given that term in ORS
735.405. [1987 c.774 §113; 1991 c.810 §24; 2011 c.660 §20]
Note:
731.144 was added to and made a part of ORS chapter 731 but was not added to
any smaller series therein by legislative action. See Preface to Oregon Revised
Statutes for further explanation.
731.146 “Transact insurance.”
(1) “Transact insurance” means one or more of the following acts effected by
mail or otherwise:
(a)
Making or proposing to make an insurance contract.
(b)
Taking or receiving any application for insurance.
(c)
Receiving or collecting any premium, commission, membership fee, assessment,
due or other consideration for any insurance or any part thereof.
(d)
Issuing or delivering policies of insurance.
(e)
Directly or indirectly acting as an insurance producer for, or otherwise
representing or aiding on behalf of another, any person in the solicitation,
negotiation, procurement or effectuation of insurance or renewals thereof, the
dissemination of information as to coverage or rates, the forwarding of
applications, the delivering of policies, the inspection of risks, the fixing
of rates, the investigation or adjustment of claims or losses, the transaction
of matters subsequent to effectuation of the policy and arising out of it, or
in any other manner representing or assisting a person with respect to
insurance.
(f)
Advertising locally or circularizing therein without regard for the source of
such circularization, whenever such advertising or circularization is for the
purpose of solicitation of insurance business.
(g)
Doing any other kind of business specifically recognized as constituting the doing
of an insurance business within the meaning of the Insurance Code.
(h)
Doing or proposing to do any insurance business in substance equivalent to any
of paragraphs (a) to (g) of this subsection in a manner designed to evade the
provisions of the Insurance Code.
(2)
Subsection (1) of this section does not include, apply to or affect the
following:
(a)
Making investments within a state by an insurer not admitted or authorized to
do business within such state.
(b)
Except as provided in ORS 743.015, doing or proposing to do any insurance
business arising out of a policy of group life insurance or a policy of blanket
health insurance, if the master policy was validly issued to cover a group
organized primarily for purposes other than the procurement of insurance and
was delivered in and pursuant to the laws of another state in which:
(A)
The insurer was authorized to do an insurance business;
(B)
The policyholder is domiciled or otherwise has a bona fide situs;
and
(C)
With respect to a policy of blanket health insurance, the policy was approved
by the director of such state.
(c)
Except as provided in ORS 743.015, doing or proposing to do any insurance
business arising out of a policy of group health insurance, if the master
policy was validly issued to cover an employer group other than an association,
trust or multiple employer welfare arrangement and was delivered in and
pursuant to the laws of another state in which:
(A)
The insurer was authorized to do an insurance business; and
(B)
The policyholder is domiciled or otherwise has a bona fide situs.
(d)
Investigating, settling, or litigating claims under policies lawfully written
within a state, or liquidating assets and liabilities, all resulting from the
insurer’s former authorized operations within such state.
(e)
Transactions within a state under a policy subsequent to its issuance if the
policy was lawfully solicited, written and delivered outside the state and did
not cover a subject of insurance resident, located or to be performed in the
state when issued.
(f)
The continuation and servicing of life or health insurance policies remaining
in force on residents of a state if the insurer has withdrawn from such state
and is not transacting new insurance therein.
(3)
If mail is used, an act shall be deemed to take place at the point where the
matter transmitted by mail is delivered and takes effect. [1967 c.359 §30; 1971
c.231 §10; 1989 c.784 §4; 2003 c.364 §64; 2007 c.752 §1]
Note: The
amendments to 731.146 by section 6, chapter 752, Oregon Laws 2007, become
operative January 2, 2014. See section 13, chapter 752, Oregon Laws 2007, as
amended by section 4, chapter 81, Oregon Laws 2010, and section 10, chapter
500, Oregon Laws 2011. The text that is operative on and after January 2, 2014,
is set forth for the user’s convenience.
731.146. (1) “Transact
insurance” means one or more of the following acts effected by mail or
otherwise:
(a)
Making or proposing to make an insurance contract.
(b)
Taking or receiving any application for insurance.
(c)
Receiving or collecting any premium, commission, membership fee, assessment,
due or other consideration for any insurance or any part thereof.
(d)
Issuing or delivering policies of insurance.
(e)
Directly or indirectly acting as an insurance producer for, or otherwise
representing or aiding on behalf of another, any person in the solicitation,
negotiation, procurement or effectuation of insurance or renewals thereof, the
dissemination of information as to coverage or rates, the forwarding of
applications, the delivering of policies, the inspection of risks, the fixing
of rates, the investigation or adjustment of claims or losses, the transaction
of matters subsequent to effectuation of the policy and arising out of it, or
in any other manner representing or assisting a person with respect to
insurance.
(f)
Advertising locally or circularizing therein without regard for the source of
such circularization, whenever such advertising or circularization is for the
purpose of solicitation of insurance business.
(g)
Doing any other kind of business specifically recognized as constituting the
doing of an insurance business within the meaning of the Insurance Code.
(h)
Doing or proposing to do any insurance business in substance equivalent to any
of paragraphs (a) to (g) of this subsection in a manner designed to evade the
provisions of the Insurance Code.
(2)
Subsection (1) of this section does not include, apply to or affect the
following:
(a)
Making investments within a state by an insurer not admitted or authorized to
do business within such state.
(b)
Except as provided in ORS 743.015, doing or proposing to do any insurance
business arising out of a policy of group life insurance or group health
insurance, or both, or a policy of blanket health insurance, if the master
policy was validly issued to cover a group organized primarily for purposes
other than the procurement of insurance and was delivered in and pursuant to
the laws of another state in which:
(A)
The insurer was authorized to do an insurance business;
(B)
The policyholder is domiciled or otherwise has a bona fide situs;
and
(C)
With respect to a policy of blanket health insurance, the policy was approved
by the director of such state.
(c)
Investigating, settling, or litigating claims under policies lawfully written
within a state, or liquidating assets and liabilities, all resulting from the
insurer’s former authorized operations within such state.
(d)
Transactions within a state under a policy subsequent to its issuance if the
policy was lawfully solicited, written and delivered outside the state and did
not cover a subject of insurance resident, located or to be performed in the
state when issued.
(e)
The continuation and servicing of life or health insurance policies remaining
in force on residents of a state if the insurer has withdrawn from such state
and is not transacting new insurance therein.
(3)
If mail is used, an act shall be deemed to take place at the point where the
matter transmitted by mail is delivered and takes effect.
CLASSES OF INSURANCE DEFINED
731.150 Definitions of classes of insurance
not mutually exclusive. It is intended that certain
insurance coverages may come within the definitions
of two or more classes of insurance as defined in the Insurance Code, and the
inclusion of such coverage within one definition shall not exclude it as to any
other class of insurance within the definition of which such coverage is
likewise reasonably includable. [1967 c.359 §32]
731.154 “Annuity.”
(1) “Annuity” or “annuity policy” means any agreement to make periodic
payments, whether fixed or variable in amount, where the making of all or some
of such payments, or the amount of any such payment, is dependent upon the
continuance of human life, except payments made pursuant to the settlement
provisions of a life insurance policy, and includes additional benefits
operating to safeguard the policy from lapse or to provide a special surrender
value or special benefit or annuity in the event of total and permanent
disability of the annuitant.
(2)
“Annuity” does not include a charitable remainder annuity trust or a charitable
remainder unitrust as defined in section 664(d) of
the Internal Revenue Code. [1967 c.359 §33; 1993 c.377 §1]
731.156 “Variable life insurance”; “variable
annuity.” “Variable life insurance” and “variable
annuity” mean those forms of life insurance or annuity benefits, respectively,
which vary according to the investment experience of a separate account or
accounts maintained by the insurer with respect to policies providing such
benefits. For convenience, reference to “variable life insurance” in the
Insurance Code includes variable life insurance and variable annuities as
defined in this section, except if the inclusion of variable annuities
obviously is inapplicable or if the context requires, or the Insurance Code
provides, otherwise. [1973 c.435 §2]
731.158 “Casualty insurance.”
“Casualty insurance” means:
(1)
Insurance against legal, contractual or assumed liability for death, injury or
disability of any human, or for damage to property; and provision for medical,
hospital, surgical and disability benefits to injured persons including
insurance against the risk of economic loss assumed under a less than fully
insured employee health benefit plan and funeral and death benefits to
dependents, beneficiaries or personal representatives of persons killed,
irrespective of legal liability of the insured, when issued as coverage for
personal injury protection benefits under a motor vehicle liability policy or
as an incidental coverage with or supplemental to liability insurance;
(2)
Motor vehicle physical damage, burglary and theft, glass, boiler and machinery,
credit and livestock insurance;
(3)
Insurance of the obligations accepted by, imposed upon or assumed by employers
under law for death, disablement or occupational diseases of employees;
(4)
Insurance which undertakes to perform or provide repair or replacement service
or indemnification therefor for the operational or
structural failure of specified real or personal property or property
components; and
(5)
Insurance against any other kind of loss, damage or liability properly a
subject of insurance and not within any other class of insurance otherwise
defined, if such insurance is not disapproved by the Director of the Department
of Consumer and Business Services as being contrary to law or public policy. [1967
c.359 §34; 1981 c.247 §2; 1993 c.649 §5; 2007 c.241 §22]
731.162 “Health insurance.”
“Health insurance” means insurance of humans against bodily injury, disablement
or death by accident or accidental means, or the expense thereof, or against
disablement or expense resulting from sickness or childbirth, or against
expense incurred in prevention of sickness, in dental care or optometrical service, and every insurance appertaining
thereto, including insurance against the risk of economic loss assumed under a
less than fully insured employee health benefit plan. “Health insurance” does
not include workers’ compensation coverages. [1967
c.359 §35; 1993 c.649 §6]
731.164 “Home protection insurance,” “home
protection insurer.” (1)(a) “Home protection
insurance” means that part of casualty insurance that includes only insurance
which undertakes to perform or provide repair or replacement service or
indemnification therefor for the operational or
structural failure of the insured home, components of the home or personal
property relating to the home or its components, and does not include
protection against consequential damage from the operational or structural failure.
(b)(A)
“Home protection insurance” does not include a home service agreement.
(B)
As used in this paragraph, “home service agreement” means a contract or
agreement for a specific limited duration to:
(i) Service, repair or replace in an existing home the
mechanical or appliance system or the components that break down due to normal
wear and tear or inherent defects; or
(ii)
Provide incidental service, repair or replacement to cover leaks and failures
in roofing systems.
(c)
As used in this subsection, “home” means a single living unit or multiple
living units, including manufactured dwellings, used primarily as residences.
(2)
“Home protection insurer” means an insurer under policies of home protection
insurance, other than an insurer transacting other forms of casualty insurance
or any form of reinsurance. [1981 c.247 §4; 2003 c.283 §1]
731.166 “Industrial life insurance.”
“Industrial life insurance” means that form of life insurance written under
policies of face amount of $2,500 or less, under which premiums are payable
monthly or more often and the policy specifies it is an industrial life
insurance policy. [1967 c.359 §36]
731.170 “Life insurance”; includes
annuities. (1) “Life insurance” means insurance on
human lives and every insurance appertaining thereto and includes the granting
of endowment benefits, additional benefits in event of death or dismemberment
by accident or accidental means, additional benefits in event of the insured’s
or premium payer’s disability and optional modes of settlement of proceeds of
life insurance including annuity benefits payable under such a settlement
provision. “Life insurance” does not include workers’ compensation coverages.
(2)
For convenience, reference to “life insurance” in the Insurance Code includes
life insurance as defined in subsection (1) of this section and annuities as
defined in ORS 731.154, except if the inclusion of annuities obviously is
inapplicable or if the context requires, or the Insurance Code provides,
otherwise. [1967 c.359 §37]
731.174 “Marine and transportation
insurance.” “Marine and transportation insurance”
includes:
(1)
Insurance against any and all kinds of loss of or damage to:
(a)
Vessels, craft, aircraft, cars, automobiles and vehicles of every kind, as well
as all goods, freights, cargoes, merchandise, effects, disbursements, profits,
moneys, bullion, precious stones, securities, choses
in action, evidences of debt, valuable papers, bottomry
and respondentia interests and all other kinds of
property and interests therein, in respect to, appertaining to or in connection
with any and all risks or perils of navigation, transit or transportation,
including war risks, on or under any seas or other waters, on land or in the
air, or while being assembled, packed, crated, baled, compressed or similarly
prepared for shipment or while awaiting the same or during any delays, storage,
transshipment, or reshipment incident thereto, including marine builders’
risks, and all personal property floater risks including bailees’
customers risks;
(b)
Person or to property in connection with or appertaining to a marine, inland
marine, transit or transportation insurance, including liability for loss of or
damage to either, arising out of or in connection with the construction,
repair, operation, maintenance or use of the subject matter of such insurance
(but not including life insurance or surety bonds nor insurance against loss by
reason of bodily injury to the person arising out of the ownership, maintenance
or use of automobiles);
(c)
Precious stones, jewels, jewelry, gold, silver and other precious metals,
whether used in business or trade or otherwise and whether the same is in
course of transportation or otherwise; and
(d)
Bridges, tunnels and other instrumentalities of transportation and
communication (excluding buildings, their furniture and furnishings, fixed
contents and supplies held in storage) unless fire, tornado, sprinkler leakage,
hail, explosion, earthquake, riot and civil commotion, or any of them, are the
only hazards to be covered; piers, wharves, docks, and slips, excluding the
risks of fire, tornado, sprinkler leakage, hail, explosion, earthquake, riot
and civil commotion or any of them; other aids to navigation and
transportation, including dry docks and marine railways, against all risks.
(2)
Marine protection and indemnity insurance meaning insurance against, or against
legal liability of the insured for, loss, damage or expense arising out of, or
incident to, the ownership, operation, chartering, maintenance, use, repair or
construction of any vessel, craft or instrumentality in use in ocean or inland
waterways, including liability of the insured for personal injury, illness or
death or for loss of or damage to the property of another person. [Formerly
745.005]
731.178 “Mortgage insurance.”
“Mortgage insurance” means insurance against financial loss by reason of:
(1)
Nonpayment of principal, interest and other sums agreed to be paid under the
terms of an obligation secured by a mortgage, deed of trust or other instrument
constituting a lien or charge on real or personal property; or
(2)
Nonpayment of rent and other sums agreed to be paid under the terms of a
written lease for the possession, use or occupancy of real property, such
insurance also being referred to in the Insurance Code as “lease insurance.” [1967
c.359 §39; 1969 c.692 §1]
731.182 “Property insurance.”
“Property insurance” means insurance on real or personal property of every kind
and of every interest therein, whether on land, water or in the air, against
loss or damage from any and all hazard or cause, and against consequential loss
from such loss or damage, other than noncontractual
legal liability for loss or damage. “Property insurance” does not include title
insurance. [1967 c.359 §40]
731.186 “Surety insurance.”
“Surety insurance” means insurance guaranteeing the fidelity of persons holding
places of trust, the performance of duties, contracts, bonds and undertakings,
including the signing thereof as surety, and insuring the performance of obligations
of employers under workers’ compensation laws by surety bond. [1967 c.359 §41]
731.190 “Title insurance.”
“Title insurance” means insurance of owners of property or others having an
interest therein or liens or encumbrances thereon, against loss by encumbrance,
defective titles, invalidity or adverse claim to title. [1967 c.359 §42]
731.194 “Wet marine and transportation
insurance.” “Wet marine and transportation
insurance” is that part of marine and transportation insurance that includes only:
(1)
Insurance upon vessels, crafts, hulls and of interests therein or with relation
thereto;
(2)
Insurance of marine builder’s risks, marine war risks and contracts referred to
in ORS 731.174 (2) or any replacement thereof;
(3)
Insurance of freights and disbursements pertaining to a subject of insurance
coming within this section;
(4)
Insurance of personal property and interests therein, in course of exportation
from or importation into any country, and in course of transportation coastwise
or on inland waters, including transportation by land, water, or air from point
of origin to final destination, in respect to, appertaining to or in connection
with, any and all risks or perils of navigation, transit or transportation, and
while being prepared for and while awaiting shipment, and during any delays,
storage, transshipment or reshipment incident thereto;
(5)
Insurance on operations of railroads engaged in transportation in interstate
commerce and their property used in such operations; and
(6)
Insurance of aircraft operated in scheduled interstate flight, or cargo of such
aircraft, or against this liability other than workers’ compensation and
employers’ liability arising out of the ownership, maintenance or use of such
aircraft. [1967 c.359 §43; 1987 c.774 §114]
731.204
[Formerly 736.495; repealed by 1987 c.373 §85]
731.208
[Formerly 736.500; repealed by 1987 c.373 §85]
731.212 [1967
c.359 §46; repealed by 1987 c.373 §85]
INSURANCE ADMINISTRATION
731.216 Administrative power of director.
The Director of the Department of Consumer and Business Services shall have the
power to:
(1)
Contract for and procure, on a fee or part-time basis, or both, such actuarial,
technical or other professional services as may be required for the discharge
of duties.
(2)
Obtain such other services as the director considers necessary or desirable,
including participation in organizations of state insurance supervisory
officials and appointment of advisory committees. A member of an advisory
committee so appointed shall receive no compensation for services as a member,
but, subject to any other applicable law regulating travel and other expenses
of state officers, shall receive actual and necessary travel and other expenses
incurred in the performance of official duties.
(3)
Establish within the Department of Consumer and Business Services a workers’
compensation rating bureau to provide rating information that is based upon and
relevant to activities conducted in this state, to enable the director to carry
out the provisions of ORS chapter 737. In lieu of creating a rating bureau
within the department, the director may contract with any rating organization
in other states if the director finds that such a contract would provide the
information required by this section. [Formerly 736.503; 1987 c.373 §77; 1987
c.884 §50; 2003 c.14 §445]
731.220
[Formerly 736.507; repealed by 1987 c.373 §85]
731.224 [1967
c.359 §49; repealed by 1987 c.373 §85]
731.228 Prohibited interests and rewards.
(1) No officer or employee of the Department of Consumer and Business Services
delegated responsibilities in the enforcement of the Insurance Code shall:
(a)
Be a director, officer, or employee of or be financially interested in any
person regulated by the department or office of the department that is
delegated responsibility in the enforcement of the Insurance Code, except as a
policyholder or claimant under an insurance policy or by reason of rights
vested in commissions, fees, or retirement benefits related to services
performed prior to affiliation with the department; or
(b)
Be engaged in any other business or occupation interfering with or inconsistent
with the duties of the office or employment.
(2)
No person shall directly or indirectly give or pay, or offer to give or pay, to
the Director of the Department of Consumer and Business Services, or any
officer or employee of the department, and the director or such officer or
employee shall not directly or indirectly solicit, receive or accept any fee,
compensation, loan, gift or other thing of value in addition to the
compensation and expense allowance provided by law, for:
(a)
Any service rendered or to be rendered as such director, officer or employee,
or in connection therewith;
(b)
Services rendered or to be rendered in relation to legislation;
(c)
Extra services rendered or to be rendered; or
(d)
Any cause whatsoever related to any person regulated by the department or
office of the department that is delegated responsibility in the enforcement of
the Insurance Code.
(3)
This section does not permit any conduct, affiliation or interest that is
otherwise prohibited by public policy. [1967 c.359 §50; 1987 c.373 §78]
731.232 Subpoena power.
(1) For the purpose of an investigation or proceeding under the Insurance Code,
the Director of the Department of Consumer and Business Services may administer
oaths and affirmations, subpoena witnesses, compel their attendance, take
evidence and require the production of books, papers, correspondence,
memoranda, agreements or other documents or records which the director
considers relevant or material to the inquiry. Each witness who appears before
the director under a subpoena shall receive the fees and mileage provided for
witnesses in ORS 44.415 (2).
(2)
If a person fails to comply with a subpoena so issued or a party or witness
refuses to testify on any matters, the judge of the circuit court for any
county, on the application of the director, shall compel obedience by
proceedings for contempt as in the case of disobedience of the requirements of
a subpoena issued from such court or a refusal to testify therein. [1967 c.359 §51;
1989 c.980 §22]
731.236 General powers and duties.
(1) The Director of the Department of Consumer and Business Services shall
enforce the provisions of the Insurance Code for the public good, and shall
execute the duties imposed by the code.
(2)
The director has the powers and authority expressly conferred by or reasonably
implied from the provisions of the Insurance Code.
(3)
The director may conduct such examinations and investigations of insurance
matters, in addition to examinations and investigations expressly authorized,
as the director considers proper to determine whether any person has violated
any provision of the Insurance Code or to secure information useful in the
lawful administration of any such provision. The cost of such additional
examinations and investigations shall be borne by the state.
(4)
The director has such additional powers and duties as may be provided by other
laws of this state. [1967 c.359 §52]
731.240 Hearings in general.
(1) The Director of the Department of Consumer and Business Services shall hold
a hearing upon written demand for a hearing by a person aggrieved by any act,
threatened act or failure of the director to act. The demand must state the
grounds therefor.
(2)
To the extent applicable and not inconsistent with subsection (1) of this
section, the provisions of ORS chapter 183 shall govern the hearing procedure
and any judicial review thereof. [1967 c.359 §53; 1991 c.401 §1]
731.244 Rules.
In accordance with the applicable provisions of ORS chapter 183, the Director
of the Department of Consumer and Business Services may make reasonable rules
necessary for or as an aid to the effectuation of the Insurance Code. No such
rule shall extend, modify or conflict with the Insurance Code or the reasonable
implications thereof. [1967 c.359 §54]
731.248 Orders.
(1) Orders of the Director of the Department of Consumer and Business Services
shall be effective only when in writing and signed by the director or by the
authority of the director. Orders shall be filed in the Department of Consumer
and Business Services.
(2)
Every such order shall state:
(a)
Its effective date;
(b)
Its intent or purpose;
(c)
The grounds on which based; and
(d)
The provisions of the Insurance Code pursuant to which action is taken or
proposed to be taken.
(3)
Except as may be provided in the Insurance Code respecting particular
procedures, an order or notice may be given by delivery to the person to be
ordered or notified or by mailing it by certified or registered mail, return
receipt requested, postage prepaid, addressed to the person at the residence or
principal place of business of the person as last of record in the department.
Notice so mailed shall be deemed to have been given when deposited in a letter
depository of a United States post office. [1967 c.359 §55]
731.252 Cease and desist orders.
(1) Whenever the Director of the Department of Consumer and Business Services
has reason to believe that any person has been engaged or is engaging or is
about to engage in any violation of the Insurance Code, the director may issue
an order, directed to such person, to discontinue or desist from such violation
or threatened violation. The copy of the order forwarded to the person involved
shall set forth a statement of the specific charges and the fact that the
person may request a hearing within 20 days of the date of mailing. Where a
hearing is requested, the director shall set a date for the hearing to be held
within 30 days after receipt of the request, and shall give the person involved
written notice of the hearing date at least seven days prior thereto. The
person requesting the hearing must establish to the satisfaction of the
director that such order should not be complied with. The order shall become
final 20 days after the date of mailing unless within such 20-day period the
person to whom it is directed files with the director a written request for a
hearing. To the extent applicable and not inconsistent with the foregoing, the
provisions of ORS chapter 183 shall govern the hearing procedure and any
judicial review thereof. Where the hearing has been requested, the director’s
order shall become final at such time as the right to further hearing or review
has expired or been exhausted.
(2)
No order of the director under this section or order of a court to enforce the
same shall in any way relieve or absolve any person affected by such order from
any liability under any other laws of this state.
(3)
The powers vested in the director pursuant to this section are supplementary
and not in lieu of any other powers to suspend or revoke certificates of
authority or licenses or to enforce any penalties, fines or forfeitures,
authorized by law with respect to any violation for which an order of
discontinuance has been issued. [Formerly 736.835]
731.256 Enforcement generally.
(1) The Director of the Department of Consumer and Business Services may
institute such actions or other lawful proceedings as the director may deem
necessary for the enforcement of any provision of the Insurance Code or any
order or action made or taken by the director in pursuance of law.
(2)
If the director has reason to believe that any person has violated any
provision of the Insurance Code or other law applicable to insurance
operations, for which criminal prosecution is provided and in the opinion of
the director would be in order, the director shall give the information
relative thereto to the Attorney General or district attorney having
jurisdiction of any such violation. The Attorney General or district attorney
promptly shall institute such action or proceedings against such person as the
information requires or justifies. [1967 c.359 §57]
731.258 Enforcement of orders and
decisions by Attorney General; filing, enforcement and effect of foreign
decrees. (1) The Attorney General upon request
of the Director of the Department of Consumer and Business Services may proceed
in the courts of this state or any reciprocal state to enforce an order or
decision in any court proceeding or in any administrative proceeding before the
director.
(2)
As used in this section:
(a)
“Reciprocal state” means any state the laws of which contain procedures
substantially similar to those specified in this section for the enforcement of
decrees or orders in equity issued by courts located in other states, against
any insurer incorporated or authorized to do business in such state.
(b)
“Foreign decree” means any decree or order in equity of a court located in a
reciprocal state, including a court of the United States located therein,
against any insurer incorporated or authorized to do business in this state.
(c)
“Qualified party” means a state regulatory agency acting in its capacity to enforce
the insurance laws of its state.
(3)
The Director of the Department of Consumer and Business Services of this state
shall determine which states qualify as reciprocal states and shall maintain at
all times an up-to-date list of such states.
(4)
A copy of any foreign decree authenticated in accordance with the statutes of
this state may be filed in the office of the clerk of any circuit court of this
state. The clerk, upon verifying with the director that the decree or order
qualifies as a foreign decree shall treat the foreign decree in the same manner
as a judgment of a circuit court of this state. A foreign decree so filed has
the same effect and shall be deemed as a judgment of a circuit court of this
state, and is subject to the same procedures, defenses and proceedings for
reopening, vacating, or staying as a judgment of a circuit court of this state
and may be enforced or satisfied in like manner.
(5)(a)
At the time of the filing of the foreign decree, the Attorney General shall
make and file with the clerk of the court an affidavit setting forth the name
and last-known post-office address of the defendant.
(b)
Promptly upon the filing of the foreign decree and the affidavit, the clerk
shall mail notice of the filing of the foreign decree to the defendant at the
address given and to the director of this state and shall make a note of the
mailing in the register of the court. In addition, the Attorney General may
mail a notice of the filing of the foreign decree to the defendant and to the
director of this state and may file proof of mailing with the clerk. Lack of
mailing notice of filing by the clerk shall not affect the enforcement
proceedings if proof of mailing by the Attorney General has been filed.
(c)
No execution or other process for enforcement of a foreign decree filed under
subsection (4) of this section shall issue until 30 days after the date the
decree is filed.
(6)(a)
If the defendant shows the circuit court that an appeal from the foreign decree
is pending or will be taken, or that a stay of execution has been granted, the
court shall stay enforcement of the foreign decree until the appeal is
concluded, the time for appeal expires, or the stay of execution expires or is
vacated, upon proof that the defendant has furnished the security for the
satisfaction of the decree required by the state in which it was rendered.
(b)
If the defendant shows the circuit court any ground upon which enforcement of a
judgment of any circuit court of this state would be stayed, the court shall
stay enforcement of the foreign decree for an appropriate period, upon
requiring the same security for satisfaction of the decree which is required in
this state for a judgment. [1969 c.336 §5; 2003 c.576 §219]
731.260 False or misleading filings.
No person shall file or cause to be filed with the Director of the Department
of Consumer and Business Services any article, certificate, report, statement,
application or any other information required or permitted to be so filed under
the Insurance Code and known to such person to be false or misleading in any
material respect. [Formerly 736.650]
731.264 Complaints and investigations
confidential; permitted disclosures; rules. (1) A
complaint made to the Director of the Department of Consumer and Business
Services against any person regulated by the Insurance Code, and the record
thereof, shall be confidential and may not be disclosed except as provided in
ORS 705.137. No such complaint, or the record thereof, shall be used in any
action, suit or proceeding except to the extent considered necessary by the
director in the prosecution of apparent violations of the Insurance Code or
other law.
(2)
Data gathered pursuant to an investigation by the director of a complaint shall
be confidential, may not be disclosed except as provided in ORS 705.137 and may
not be used in any action, suit or proceeding except to the extent considered
necessary by the director in the investigation or prosecution of apparent
violations of the Insurance Code or other law.
(3)
Notwithstanding subsections (1) and (2) of this section, the director shall
establish by rule a method for publishing an annual statistical report
containing the insurer’s name and the number, percentage, type and disposition
of complaints received by the Department of Consumer and Business Services
against each insurer transacting insurance within this state. [1967 c.359 §59;
1971 c.231 §11; 1987 c.481 §1; 1987 c.774 §149; 2001 c.377 §4]
731.268 Use of reproductions and certified
copies as evidence; fee. (1) Photographs or
microphotographs in the form of film or prints of documents and records made by
the Director of the Department of Consumer and Business Services for the files
of the director shall have the same force and effect as the originals thereof,
and duly certified or authenticated reproductions of such photographs or
microphotographs shall be as admissible in evidence as are the originals.
(2)
Upon request of any person and payment of the applicable fee, the director
shall furnish a certified copy of any record in the office of the director
which is then subject to public inspection.
(3)
Copies of original records or documents in the office of the director certified
by the director shall have the same force and effect and be received in
evidence in all courts equally and in like manner as if they were originals. [1967
c.359 §60]
731.272 Director’s annual reports; notice
of publication of report. (1) The Director of the
Department of Consumer and Business Services shall prepare annually, as soon
after March 1 as is consistent with full and accurate preparation, a report of
the official transactions of the director under the Insurance Code. The report
shall include:
(a)
In condensed form statements made to the director by every insurer authorized
to do business in this state.
(b)
A statement of all insurers authorized to do business in this state as of the
date of the report.
(c)
A list of insurers whose business in this state was terminated and the reason
for the termination. If the termination was a result of liquidation or
delinquency proceedings brought against the insurer in this or any other state,
the report shall include the amount of the insurer’s assets and liabilities so
far as those amounts are known to the director.
(d)
A statement of the operating expenses of the Department of Consumer and
Business Services under the Insurance Code, including salaries, transportation,
communication, printing, office supplies, fixed charges and miscellaneous
expenses.
(e)
A detailed statement of the moneys, fees and taxes received by the department
under the Insurance Code and from what source.
(f)
Any other pertinent information and matters as the director considers to be in
the public interest.
(2)
The director shall give notice of the publication of the report to:
(a)
The office of the Speaker of the House of Representatives;
(b)
The office of the President of the Senate; and
(c)
The chair or cochairs of the Joint Legislative
Committee on Ways and Means if the Legislative Assembly is in session or of the
Emergency Board if during the interim. [Formerly 736.520; 1987 c.373 §79; 2005
c.185 §8]
731.276 Recommendations for changes in
Insurance Code. The Director of the Department
of Consumer and Business Services shall continuously review the Insurance Code and
shall work with the Director of the Oregon Health Authority to review the
health insurance provisions of the Insurance Code and may, from time to time,
make recommendations for changes therein. [1967 c.359 §62; 2009 c.595 §1117]
731.280 Publications authorized.
The Director of the Department of Consumer and Business Services shall publish:
(1)
Pamphlet or booklet copies of the insurance laws of this state;
(2)
The director’s annual report;
(3)
Such copies of results of investigations or examinations of insurers for public
distribution as the director considers to be in the public interest;
(4)
Such compilations as the director considers advisable from time to time of the
general orders of the director then in force; and
(5)
Such other material as the director may compile and consider relevant and
suitable for the effective administration of the Insurance Code. [1967 c.359 §63]
731.282 Authority to sell publications.
The Director of the Department of Consumer and Business Services may sell, at a
price reasonably calculated to cover the costs of preparation, any of the
copies, compilations or materials described in ORS 731.280. [1971 c.231 §2;
1982 s.s.1 c.17 §3]
731.284 Distribution of insurance laws.
Copies of the insurance laws in pamphlet form may be sold by the Director of
the Department of Consumer and Business Services at a reasonable price. The
director may distribute free of charge one copy of such pamphlet to each of the
following:
(1)
Authorized insurers and licensed rating organizations;
(2)
Insurance departments of other states; and
(3)
Public agencies. However, the director may distribute such quantities to public
agencies as the director determines. [1967 c.359 §64; 2003 c.364 §65]
731.288 Recording complaints; director to
consider complaints before issuing licenses. The
Department of Consumer and Business Services shall record each complaint the
department receives, including the subsequent disposition of the complaint. The
record of a complaint shall be maintained for a period of not less than seven
years. The records of complaints shall be indexed whenever applicable both by
the name of the insurer and by the name of the insurance producer involved. The
Director of the Department of Consumer and Business Services shall consider such
complaints before issuing or continuing any certificate of authority or license
of an insurer or insurance producer named in such complaints. [Formerly
736.580; 2003 c.364 §66; 2003 c.802 §168]
731.292 Disposition of fees, charges,
taxes, penalties and other moneys. (1) Except as
provided in subsections (2), (3) and (4) of this section, all fees, charges and
other moneys received by the Department of Consumer and Business Services or
the Director of the Department of Consumer and Business Services under the
Insurance Code shall be deposited in the fund created by ORS 705.145 and are
continuously appropriated to the department for the payment of the expenses of
the department in carrying out the Insurance Code.
(2)
All taxes and penalties paid pursuant to the Insurance Code shall be paid to
the director and after deductions of refunds shall be paid by the director to
the State Treasurer, at the end of every calendar month or more often in the
director’s discretion, for deposit in the General Fund to become available for
general governmental expenses.
(3)
All premium taxes received by the director pursuant to ORS 731.820 shall be
paid by the director to the State Treasurer for deposit in the State Fire
Marshal Fund.
(4)
Assessments received by the department under ORS 743.951 and 743.961 and
penalties received by the department under ORS 743.990 and section 10, chapter
867, Oregon Laws 2009, shall be paid into the State Treasury and credited to
the Health System Fund established in section 1, chapter 867, Oregon Laws 2009,
after deducting the following amounts:
(a)
Amounts needed to reimburse the department for expenses in administering ORS
743.951 to 743.965 and 743.990; and
(b)
Amounts needed to reimburse the General Fund for reductions in revenue caused
by the effect of ORS 743.961 on the retaliatory tax imposed under ORS 731.854
and 731.859. [Formerly 736.525; 1981 c.652 §3; 1982 s.s.1 c.17 §1; 1987 c.373 §80;
1991 c.67 §193; 2009 c.867 §13; 2011 c.597 §296]
731.296 Director’s inquiries.
The Director of the Department of Consumer and Business Services may address
any proper inquiries to any insurer, licensee or its officers in relation to
its activities or condition or any other matter connected with its
transactions. Any such person so addressed shall promptly and truthfully reply
to such inquiries using the form of communication requested by the director.
The reply shall be verified by an officer of such person, if the director so
requires. A reply is subject to the provisions of ORS 731.260. [Formerly
736.542; 1975 c.298 §1]
731.300 Examination of insurers; when
required. (1) The Director of the Department of
Consumer and Business Services shall examine every authorized insurer,
including an audit of the financial affairs of such insurer, as often as the
director determines an examination to be necessary but at least once each five
years. An examination shall be conducted for the purpose of determining the
financial condition of the insurer, its ability to fulfill its obligations and
its manner of fulfillment, the nature of its operations and its compliance with
the Insurance Code. The director may also make such an examination of any
surplus lines insurance producer or any person holding the capital stock of an
authorized insurer or surplus lines insurance producer for the purpose of
controlling the management thereof as a voting trustee or otherwise, or both.
(2)
Instead of conducting an examination of an authorized foreign or alien insurer,
the director may accept an examination report on the insurer that is prepared
by the insurance department for the state of domicile or state of entry of the
insurer if:
(a)
At the time of the examination the insurance department of the state was
accredited under the Financial Regulation Standards and Accreditation Program
or successor program of the National Association of Insurance Commissioners; or
(b)
The examination was performed under the supervision of an accredited insurance
department or with the participation of one or more examiners who are employed
by such an accredited insurance department and who, after a review of the
examination work papers and report, state under oath that the examination was
performed in a manner consistent with the standards and procedures required by
their insurance department.
(3)
Examination of an alien insurer shall be limited to its insurance transactions,
assets, trust deposits and affairs in the United States except as otherwise
required by the director. [Formerly 736.545; 1979 c.870 §2; 1981 c.874 §18;
1990 c.2 §46; 1993 c.447 §1; 2003 c.364 §67]
731.302 Appointment of examiners;
retaining of appraisers, actuaries and others; evidentiary status of facts and
conclusions. (1) When the Director of the Department
of Consumer and Business Services determines that an examination should be
conducted, the director shall appoint one or more examiners to perform the
examination and instruct them as to the scope of the examination. In conducting
the examination, each examiner shall consider the guidelines and procedures in
the examiner handbook, or its successor publication, adopted by the National
Association of Insurance Commissioners. The director may prescribe the examiner
handbook or its successor publication and employ other guidelines and
procedures that the director determines to be appropriate.
(2)
When making an examination, the director may retain appraisers, independent
actuaries, independent certified public accountants or other professionals and
specialists as needed. The cost of retaining such professionals and specialists
shall be borne by the person that is the subject of the examination.
(3)
At any time during the course of an examination, the director may take other
action pursuant to the Insurance Code.
(4)
Facts determined and conclusions made pursuant to an examination shall be
presumptive evidence of the relevant facts and conclusions in any judicial or
administrative action. [1993 c.447 §2]
731.304 Investigation of persons
transacting insurance. The Director of the Department
of Consumer and Business Services, whenever the director deems it advisable in
the interest of policyholders or for the public good, shall investigate into
the affairs of any person engaged in, proposing to engage in or claiming or
advertising to engage in:
(1)
Transacting insurance in this state;
(2)
Organizing or receiving subscriptions for or disposing of the stock of or in
any manner taking part in the formation or business of an insurer; or
(3)
Holding capital stock of one or more insurers for the purpose of controlling
the management thereof as voting trustee or otherwise. [1967 c.359 §69]
731.308 Procedure at examination or
investigation; production of books and other records.
(1) Upon an examination or investigation the Director of the Department of
Consumer and Business Services may examine under oath all persons who may have
material information regarding the property or business of the person being
examined or investigated.
(2)
Every person being examined or investigated shall produce all books, records,
accounts, papers, documents and computer and other recordings in its possession
or control relating to the matter under examination or investigation,
including, in the case of an examination, the property, assets, business and
affairs of the person.
(3)
With regard to an examination, the officers, directors and agents of the person
being examined shall provide timely, convenient and free access at all
reasonable hours at the offices of the person being examined to all books,
records, accounts, papers, documents and computer and other recordings. The
officers, directors, employees and agents of the person must facilitate the
examination. [Formerly 736.555; 1993 c.447 §3]
731.312 Report of examination; review by
person examined; hearing; confidentiality of certain information and documents;
permitted disclosures. (1) Not later than the 60th day
after completion of an examination, the examiner in charge of the examination
shall submit to the Director of the Department of Consumer and Business
Services a full and true report of the examination, verified by the oath of the
examiner. The report shall comprise only facts appearing upon the books,
papers, records, accounts, documents or computer and other recordings of the
person, its agents or other persons being examined or facts ascertained from
testimony of individuals concerning the affairs of such person, together with
such conclusions and recommendations as reasonably may be warranted from such
facts.
(2)
The director shall make a copy of the report submitted under subsection (1) of
this section available to the person who is the subject of the examination and
shall give the person an opportunity to review and comment on the report. The
director may request additional information or meet with the person for the
purpose of resolving questions or obtaining additional information, and may
direct the examiner to consider the additional information for inclusion in the
report.
(3)
Before the director files the examination report as a final examination report
or makes the report or any matters relating thereto public, the person being
examined shall have an opportunity for a hearing. A copy of the report must be
mailed by certified mail to the person being examined. The person may request a
hearing not later than the 30th day after the date on which the report was
mailed. This subsection does not limit the authority of the director to
disclose a preliminary or final examination report as otherwise provided in
this section.
(4)
The director shall consider comments presented at a hearing requested under
subsection (3) of this section and may direct the examiner to consider the
comments or direct that the comments be included in documentation relating to
the report, although not as part of the report itself. The director may file the
report as a final examination report at any time after consideration of the
comments or at any time after the period for requesting a hearing has passed if
a hearing is not requested.
(5)
A report filed as a final examination report is subject to public inspection.
The director, after filing any report, if the director considers it for the
interest of the public to do so, may publish any report or the result of any
examination as contained therein in one or more newspapers of the state without
expense to the person examined.
(6)
All work papers, recorded information, documents and copies thereof that are
produced or obtained by or disclosed to the director or any other person in the
course of an examination or in the course of analysis by the director of the
financial condition or market conduct of an insurer are confidential and are
exempt from public inspection as provided in ORS 705.137. If the director, in
the director’s sole discretion, determines that disclosure is necessary to
protect the public interest, the director may make available work papers,
recorded information, documents and copies thereof produced by, obtained by or
disclosed to the director or any other person in the course of the examination.
(7)
The director may disclose the content of an examination report that has not yet
otherwise been disclosed or may disclose any of the materials described in
subsection (6) of this section as provided in ORS 705.137. [Formerly 736.560;
1993 c.447 §4; 1999 c.364 §1; 2001 c.377 §5]
731.314 Immunity for director, examiner
and others. (1) No cause of action may arise and no
liability may be imposed against the Director of the Department of Consumer and
Business Services, an authorized representative of the director or any examiner
appointed by the director for any statements made or conduct performed in good
faith pursuant to an examination or investigation.
(2)
No cause of action may arise and no liability may be imposed against any person
for communicating or delivering information or data to the director or an
authorized representative of the director or examiner pursuant to an
examination or investigation if the communication or delivery was performed in
good faith and without fraudulent intent or an intent to deceive.
(3)
This section does not abrogate or modify in any way any common law or statutory
privilege or immunity otherwise enjoyed by any person to which subsection (1)
or (2) of this section applies.
(4)
The court may award reasonable attorney fees to the prevailing party in a cause
of action arising out of activities of the director or an examiner in carrying
out an examination or investigation. [1993 c.447 §5; 1995 c.618 §127]
731.316 Expenses of examination of
insurer. Any person examined under ORS 731.300
shall pay to the Director of the Department of Consumer and Business Services
the just and legitimate costs of the examination as determined by the director,
including actual necessary transportation and traveling expenses. [Formerly
736.565; 1969 c.336 §6]
731.324 Service of process on Secretary of
State; notice to unauthorized insurer. (1) Any act
set forth in ORS 731.146 by an unauthorized insurer is equivalent to and shall
constitute an irrevocable appointment by such insurer, binding upon the
insurer, the executor of the insurer or administrator, or successor in interest
if a corporation, of the Secretary of State or the successor in office, to be
the true and lawful attorney of such insurer. All lawful process in any action
in any court by the Director of the Department of Consumer and Business
Services or by the state and any notice, order, pleading or process in any
proceeding before the director which arises out of transacting insurance in
this state by such insurer may be served upon the Secretary of State or the
successor in office. Transacting insurance in this state by an unauthorized
insurer shall be signification of its agreement that lawful process in a court
action and any notice, order, pleading, or process in an administrative
proceeding before the director so served shall be of the same legal force and
validity as personal service of process in this state upon such insurer.
(2)
Service of process in such action shall be made by delivering to and leaving
with the Secretary of State, or one of the assistants, two copies of the
document served and by payment to the Secretary of State of the fee prescribed
by law. Service upon the Secretary of State shall be service upon the
principal.
(3)
The Secretary of State shall forward by certified mail one of the copies of
such process or such notice, order, pleading, or process in proceedings before
the director to the defendant in such court proceeding or to whom the notice,
order, pleading, or process in such administrative proceeding is addressed or
directed at its last-known principal place of business and shall keep a record
of all process so served on the defendant. Such record shall show the day and
hour of service. Service is sufficient, provided:
(a)
Notice of service and a copy of the court process or the notice, order,
pleading, or process in the administrative proceeding are sent within 10 days
thereafter by certified mail by the plaintiff or the plaintiff’s attorney in
the court proceeding or by the director in the administrative proceeding to the
defendant at the last-known principal place of business of the defendant.
(b)
The defendant’s receipt or receipts issued by the post office with which the
letter is certified or registered, showing the name of the sender of the letter
and the name and address of the person or insurer to whom the letter is
addressed, and an affidavit of the plaintiff or the plaintiff’s attorney in
court proceeding or of the director in administrative proceeding, showing
compliance therewith are filed with the clerk of the court in which such action
is pending or with the director in administrative proceedings, on or before the
date the defendant in the court or administrative proceeding is required to
appear or respond thereto, or within such further time as the court or director
may allow.
(4)
No plaintiff shall be entitled to a judgment or a determination by default in
any court or administrative proceeding in which court process or notice, order,
pleading, or process in proceedings before the director is served under this
section until the expiration of 45 days after the date of filing of the
affidavit of compliance.
(5)
Nothing in this section shall limit or affect the right to serve any process,
notice, order, or demand upon any person or insurer in any other manner now or
hereafter permitted by law. [1969 c.336 §3]
731.328 Deposits by unauthorized insurers in
actions or proceedings. (1) Before an unauthorized
insurer files or causes to be filed any pleading in any court action or any
notice, order, pleading, or process in an administrative proceeding before the
Director of the Department of Consumer and Business Services instituted against
such person or insurer, by services made as provided in ORS 731.324, such
insurer shall deposit with the clerk of the court in which such action is pending,
or with the director in administrative proceedings before the director, cash or
securities. The insurer may also file with such clerk or director a bond with
good and sufficient sureties, to be approved by the clerk or director, or an
irrevocable letter of credit issued by an insured institution, as defined in
ORS 706.008, in an amount to be fixed by the court or director sufficient to
secure the payment of any final judgment which may be rendered in such action
or administrative proceeding.
(2)
The director, in any administrative proceeding in which service is made as
provided in ORS 731.324, may order such postponement as may be necessary to
afford the defendant reasonable opportunity to comply with the provisions of
subsection (1) of this section and to defend such action.
(3)
Nothing in subsection (1) of this section shall be construed to prevent an
unauthorized insurer from filing a motion to quash a writ or to set aside
service thereof made in the manner provided in ORS 731.324. [1969 c.336 §4;
1991 c.331 §126; 1997 c.631 §545]
AUTHORIZATION OF INSURERS AND GENERAL
REQUIREMENTS
731.354 Certificate of authority required.
No person shall act as an insurer and no insurer shall directly or indirectly
transact insurance in this state except as authorized by a subsisting
certificate of authority issued to the insurer by the Director of the
Department of Consumer and Business Services. [1967 c.359 §73]
731.356 Unauthorized insurance transaction
enforcement. When the Director of the Department of
Consumer and Business Services believes, from evidence satisfactory to the
director, that any insurer is violating or about to violate the provisions of
ORS 731.354, the director may cause a complaint to be filed in the Circuit
Court of Marion County to enjoin and restrain such insurer from continuing such
violation. The court shall have jurisdiction of the proceeding and shall have
the power to make and enter an order or judgment awarding such preliminary or
final injunctive relief as in its judgment is proper. [1969 c.336 §2]
731.358 Requirements of domestic insurers
generally. Upon application a domestic insurer
shall be granted a certificate of authority to transact any class of insurance
permitted by the Insurance Code and provided for in its articles of
incorporation upon its compliance with all the laws of this state and the rules
of the Department of Consumer and Business Services relating to such insurers. [Formerly
736.085]
731.362 Requirements of foreign or alien
insurers generally. (1) A foreign or alien insurer
may be authorized to transact insurance in this state when it has complied with
the following requirements:
(a)
It shall file with the Director of the Department of Consumer and Business
Services a certified copy of its charter, articles of incorporation or deed of
settlement and a statement of its financial condition and business in all
states in such form and detail as the director may require, signed and sworn to
by at least two of its executive officers or the United States manager.
(b)
It shall satisfy the director that it is fully and legally organized under the
laws of its state or government to do the business it proposes to transact.
(c)
It shall satisfy the director that it is possessed of and will maintain at all
times its required capitalization.
(d)
It shall make such deposits with the Department of Consumer and Business
Services as are required by the provisions of the Insurance Code.
(2)
Upon compliance with the requirements of this section and all other
requirements imposed on such insurer by the Insurance Code, the director shall
issue to it a certificate of authority. [Formerly 736.205; 1999 c.196 §1]
731.363 Authorized foreign insurer becoming
domestic insurer. (1) An authorized foreign
insurer may become a domestic insurer:
(a)
By complying with all of the requirements of law relating to the organization
and authorization of a domestic insurer of the same type;
(b)
By filing articles of incorporation that are amended to comply with all of the
requirements of law relating to the organization and authorization of a
domestic insurer of the same type; and
(c)
By designating its principal place of business at a place in this state.
(2)
If the Director of the Department of Consumer and Business Services determines
that an authorized foreign insurer has complied with the requirements of
subsection (1) of this section, the insurer is entitled to a certificate of
authority to transact insurance in this state and shall be subject as a
domestic insurer to the authority and jurisdiction of this state. [1995 c.639 §9;
1997 c.771 §24]
731.364 Domestic insurer transferring
domicile to another state. A domestic insurer, upon the
approval of the Director of the Department of Consumer and Business Services,
may transfer its domicile to any other state in which it is admitted to
transact the business of insurance. Upon such a transfer the insurer ceases to
be a domestic insurer and may be authorized in this state if qualified as a
foreign insurer. The director shall approve such a proposed transfer unless the
director determines that the transfer is not in the interest of the
policyholders of this state. [1995 c.639 §10]
731.365 Effect of transfer of domicile by
domestic or foreign insurer; notice to director by transferring insurer.
(1) The certificate of authority, insurance producer appointments and licenses,
rates and other items allowed by the Director of the Department of Consumer and
Business Services pursuant to the discretion of the director that are in
existence at the time an authorized insurer transfers its domicile to this or
any other state as provided in ORS 731.363 or 731.367 or by merger,
consolidation or any other lawful method shall continue in full force and
effect upon the transfer if the insurer remains authorized to transact
insurance in this state.
(2)
All outstanding policies of a transferring insurer shall remain in full force
and effect and need not be indorsed as to the new name of the insurer or its
new location unless so ordered by the director. A transferring insurer shall
file new policy forms with the director on or before the effective date of the
transfer but may use existing policy forms with appropriate indorsements
if allowed by the director, according to any conditions established by the
director.
(3)
Each transferring insurer shall notify the director of the details of the
proposed transfer and shall file promptly any resulting amendments to corporate
or other organizational documents filed or required to be filed with the
director.
(4)
This section applies to a domestic insurer that transfers its domicile to
another state and to an authorized foreign insurer that transfers its domicile
either to this state or to another state. [1995 c.639 §11; 1997 c.771 §25; 2003
c.364 §68]
731.366
[Formerly 749.040; 1971 c.231 §42; 1977 c.651 §1; 1993 c.709 §4; renumbered
731.369 in 1995]
731.367 Transfer of domicile by
unincorporated authorized foreign insurer. An
unincorporated authorized foreign insurer transfers its domicile to this state
when the Director of the Department of Consumer and Business Services
determines that it has complied with all of the requirements of law relating to
the organization and authorization of a domestic insurer of the same type as
provided in ORS 731.363. No merger, consolidation or other method shall be
required to effect a transfer of the domicile of the unincorporated insurer to
this state and no vote or approval of the policyholders, members or subscribers
of the unincorporated insurer shall be required. Any agreement of indemnity,
appointment or governance or any similar agreement shall continue in full force
after the transfer if the unincorporated insurer remains an authorized insurer.
The laws of this state, however, shall govern all such agreements regardless of
any other law to the contrary, and such agreements shall be considered to be
modified to reflect that this state is the principal place of business and
domicile of the unincorporated insurer. [1995 c.639 §12]
731.369 Requirements of reciprocal
insurers generally. (1) A reciprocal insurer,
through its attorney, shall file with the Director of the Department of
Consumer and Business Services a declaration, verified by the oath of such
attorney, setting forth:
(a)
The name or title of the reciprocal insurer.
(b)
The location of the principal office of the reciprocal insurer.
(c)
The class or classes of insurance to be effected or exchanged.
(d)
A copy of the form of power of attorney or instrument under which such
insurance is to be effected or exchanged.
(e)
A copy of the policy under or by which such contracts of insurance are effected
or exchanged among the subscribers.
(f)
That applications have been made for insurance in the amounts required by
subsection (2) of this section, and that such applications will be concurrently
effective when the reciprocal insurer is authorized to commence business by the
director.
(g)
If a foreign or alien reciprocal insurer, that there has been deposited and
shall be maintained at all times with the State Treasurer or other proper
official of the state in which the insurer is domiciled $50,000 in cash or
securities, as a general deposit for the benefit of subscribers wherever
located. Where the laws of the home state do not provide for the acceptance of
such a deposit, the deposit may be made with a bank or trust company in escrow
subject to the control of the insurance commissioner of the home state, and
such deposit shall be released only upon the written order of such insurance
commissioner. A certification from the insurance director or other proper state
official of the state in which the reciprocal insurer is domiciled shall be
attached to the application for the certificate of authority.
(2)
The reciprocal insurer must have bona fide applications for insurance aggregating
not less than $3 million upon at least 200 risks, except in the case of wet
marine hull insurance written by a domestic reciprocal insurer for persons
whose earned income, in whole or in part, is derived from taking and selling
food resources living in an ocean, bay or river, the applications must cover at
least 25 hulls and the insurance must aggregate at least $125,000.
(3)
The applicant shall furnish any other relevant information required by the
director, except no reciprocal insurer shall be required to furnish or file the
names or addresses of its policyholders or subscribers. [Formerly 731.366]
731.370 Reciprocal insurer’s financial
statement; service of process. (1) The
application for a certificate of authority shall be accompanied by a sworn
statement of a reciprocal insurer showing the financial condition of the
insurer as of December 31 immediately preceding. The Director of the Department
of Consumer and Business Services may require a supplemental statement to be
furnished as of a later date.
(2)
Concurrently with the filing of the declaration provided for by the terms of
ORS 731.369, the attorney shall file with the director an instrument in writing
executed for the subscribers conditioned that upon the issuance of certificate
of authority, action may be brought in the county in which the property insured
thereunder is situated or where the injured person
resides, and service of process may be had as provided in ORS 731.434 in all
actions in this state arising out of policies issued by the reciprocal insurer,
which service shall be valid and binding upon all subscribers exchanging at any
time reciprocal or interinsurance contracts through
such attorney. Actions may be brought against or defended in the name of the
reciprocal insurer adopted by the subscribers. [Formerly 749.050]
731.371 Powers of reciprocal insurer
regarding real estate. Except where inconsistent with
other provisions of the Insurance Code, a reciprocal insurer in its own name,
as in the case of an individual, may purchase, receive, own, hold, lease,
mortgage, pledge or encumber by deed of trust or otherwise, manage and sell
real estate for the purposes and objects of the insurer including, but not
limited to, investment for the production of income or for its accommodation in
the convenient transaction of its business. Any contract, including but not
limited to a deed, lease, mortgage, deed of trust, purchase or sale agreement
or any other contract to be executed in the name of the insurer, may be
executed by the attorney in fact designated by the insurer’s subscribers. [1991
c.401 §35]
Note:
731.371 was added to and made a part of the Insurance Code by legislative
action but was not added to ORS chapter 731 or any series therein. See Preface
to Oregon Revised Statutes for further explanation.
731.374 Exemptions to certificate of
authority requirement. A certificate of authority is
not required of an insurer with respect to the following:
(1)
Transactions pursuant to surplus lines coverages
lawfully written under the Insurance Code.
(2)
Reinsurance, when transacted by an insurer duly authorized by its state of
domicile to transact the class of insurance involved. [1967 c.359 §78]
731.378 Foreign and alien insurers exempt
from laws governing admission of foreign and alien corporations.
No foreign or alien insurer that has complied with the requirements of the
Insurance Code shall be subject to any other provisions of the laws of this
state relating to admission or licensing of foreign or alien corporations. [Formerly
736.220]
731.380 Authority of foreign and alien
insurers to take, acquire, hold and enforce notes secured by mortgages;
statement; fees. (1) Subject to subsection (2) of
this section, any foreign or alien insurer, without being authorized to
transact business in this state, may take, acquire, hold and enforce notes
secured by real estate mortgages or trust deeds and make commitments to
purchase such notes. A foreign or alien insurer may foreclose the mortgages and
trust deeds in the courts of this state, acquire the mortgaged property, hold,
own and operate the property for a period not exceeding five years and dispose
of the property. The activities authorized under this subsection by such a
foreign or alien insurer shall not constitute transacting business in this
state for the purposes of ORS chapter 60.
(2)
Before a foreign or alien insurer engages in any of the activities described in
subsection (1) of this section, the foreign or alien insurer shall first file
with the Department of Consumer and Business Services a statement signed by its
president, secretary, treasurer or general manager that it constitutes the
Director of the Department of Consumer and Business Services its attorney for
service of process, and shall pay an initial filing fee of $200 and an annual
license fee of $200. The statement shall include the address of the principal
place of business of the foreign or alien insurer.
(3)
The director, upon receiving service of process as authorized by subsection (2)
of this section, immediately shall forward by registered mail or by certified
mail with return receipt all documents served upon the director to the
principal place of business of the foreign or alien insurer.
(4)
A foreign or alien insurer that indirectly engages in the activities described
in subsection (1) of this section because of its beneficial interest in a pool
of notes secured by real estate mortgages or trust deeds need not comply with
subsection (2) of this section. [1987 c.94 §118; 1991 c.249 §70]
731.381 Exemption from taxes for foreign
and alien insurers engaging in activities authorized by ORS 731.380.
Engaging in the activities authorized by ORS 731.380 by a foreign or alien
insurer shall not subject the foreign or alien insurer to any tax, license fee
or charge, except as provided in ORS 731.380, for the privilege of doing
business within the State of Oregon or to any tax measured by net or gross
income. However, if the foreign or alien insurer acquires any property given as
security for such a mortgage or trust deed, all income accruing to the foreign
or alien insurer solely from the ownership, sale or other disposal of such
property is subject to taxation in the same manner and on the same basis as
income of corporations doing business in this state. [1987 c.94 §119]
731.382 General eligibility for
certificate of authority. To qualify for and hold
authority to transact insurance in this state an insurer must be an
incorporated insurer, or a reciprocal insurer or an incorporated fraternal
benefit society. [1967 c.359 §80]
731.385 Standards for determining whether
continued operation of insurer is hazardous; rules; order; hearing.
(1) The Director of the Department of Consumer and Business Services shall
establish standards by rule for determining whether the continued operation of
an authorized insurer may be hazardous to the policyholders or to the
insurance-buying public generally, for the purpose of carrying out ORS chapter
734 and other provisions of the Insurance Code that authorize the director to
take action against such an insurer. If the director makes such a
determination, the director may order the insurer to take one or more of the
following actions:
(a)
Reduce the total amount of present and potential liability for policy benefits
by reinsurance.
(b)
Reduce, suspend or limit the volume of business being accepted or renewed.
(c)
Reduce general insurance and commission expenses by methods specified by the
director.