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744.001 License application. (1) ORS 744.001 to 744.009, 744.011, 744.013, 744.014, 744.018, 744.022 to 744.033 and 744.037 govern the licensing of adjusters and insurance consultants.

(2) An applicant for a license as an adjuster or an insurance consultant shall apply for the license to the Director of the Department of Consumer and Business Services. The applicant shall include the following information:

(a) The applicant’s name, business address, residence address, present occupation, occupation for the last 12 months, the portion of time to be devoted to the insurance business, previous insurance experience and the names of employers during the preceding five years. The applicant shall include the business address of the principal place of business and the business address of each additional location at which the applicant will transact business under the license.

(b) All assumed business names and other names under which the applicant will engage in business under the license.

(c) Whether the applicant has ever been convicted of or is under indictment for a crime, whether the applicant has ever had a judgment entered against the applicant for fraud, whether any insurer or agent claims the applicant is indebted to it and the details of any such indebtedness, and whether any license of the applicant to act in any occupational or professional capacity has ever been refused, revoked or suspended in this or any other state.

(d) The applicant’s fingerprints, if the applicant is applying for a resident license. An applicant applying for a nonresident license shall provide the applicant’s fingerprints only if the director so requests.

(e) The class or classes of insurance to be transacted under the license.

(f) Any other information that the director requires by rule.

(3) If the applicant for a license under this section is a firm or corporation, the application shall show, in addition, the names of all members, officers and directors. If the application is a corporation, the application shall state the names of all stockholders who own, directly or indirectly, more than 10 percent of any class of any equity security of the corporation, and shall designate each individual who is to exercise the powers to be conferred by the license upon the firm or corporation.

(4) Each application shall be accompanied by the applicable fees established by the director. [1989 c.701 §§13,81g; 2001 c.191 §26]

744.002 License categories. (1) The Director of the Department of Consumer and Business Services may issue a license authorizing a person to act as an adjuster or an insurance consultant. A person licensed to act in one capacity may also be licensed to act in the other capacity if the person meets the appropriate qualifications. For purposes of this chapter, the capacity in which a person is licensed to act constitutes a "license category" or a "category of insurance business."

(a) ORS 744.531, for the license category of adjuster.

(b) ORS 744.626, for the license category of insurance consultant.

(3) The director may issue resident and nonresident licenses under this section as follows:

(a) The director may issue a resident license to a person if the person is a resident of this state or, if not a resident of this state, the person has a place of transacting insurance in this state.

(b) The director may issue a nonresident license to a person if the person is not a resident of this state.

(4) The director shall issue a license under this section:

(a) If the applicant has completed and submitted to the director an application for the license and has submitted all applicable fees, including any examination fees, as established by the director with the application;

(b) If the director determines that no ground for denial of the license exists under ORS 744.013; and

(c) If the director determines that the applicant has met the applicable qualifications and requirements for each license category, and for each class of insurance for which application is made. [1989 c.701 §§2,81e; 1995 c.639 §3; 2001 c.191 §27]

744.003 Amendment to license. (1) The Director of the Department of Consumer and Business Services may add a category of insurance business to an adjuster or insurance consultant license upon application by the licensee for amendment of the license.

744.004 Firm or corporation license. (1) The Director of the Department of Consumer and Business Services may issue or amend a firm or corporation license under ORS 744.002 only if the firm or corporation, for each category of insurance business that the firm or corporation applies for on its license, employs an individual whose license under ORS 744.002 authorizes the individual to engage in that category of insurance business.

(2) When a firm or corporation applies for a license or applies to amend the license, the director may issue or amend the license only if the firm or corporation, for each class of insurance that the firm applies to transact, employs an individual whose license under ORS 744.002 authorizes the individual to transact that class of insurance. [1989 c.701 §4]

744.005 [1967 c.359 §525; repealed by 1989 c.701 §81]

744.007 Time of expiration of license; renewal fee. (1) A license issued under ORS 744.002 expires on its expiration date unless it is renewed on or before its expiration date.

(2) A license expires on the last day of the month in which the first anniversary of the initial issuance date of the license occurs, unless the Director of the Department of Consumer and Business Services designates another date. Thereafter, the license shall expire on the second anniversary following each renewal.

(3) When a category of insurance business is added to a license, the expiration date for the license shall be the last day of the month in which the second anniversary of the issuance date of the amended license occurs, unless the director establishes another expiration date.

(4) The fee for renewal of a license shall be the fee established by the director, which shall include the fee established for each category of insurance business on the license.

(5) The director by rule may establish procedures for renewal of licenses.

(6) A suspended license is subject to renewal and to all requirements applicable to renewal if the license expires during the suspension period. [1989 c.701 §§5,81f]

744.008 Renewal of license. An adjuster or insurance consultant may renew a license subject to the following requirements:

(4) If the licensee is an insurance consultant, the licensee must provide satisfactory evidence that the insurance required under ORS 744.635 is in effect.

(5) The licensee must satisfy any other requirements established by the director by rule. [1989 c.701 §§14,81h; 1991 c.810 §2; 2001 c.191 §29]

744.009 Renewal of expired license. (1) The Director of the Department of Consumer and Business Services may renew an expired license of an adjuster or insurance consultant upon application if the license expired within two years prior to the application and if:

(a) The license was not suspended or revoked by the director, or not renewed, on any ground under ORS 744.013;

(b) The director is satisfied, by examination or otherwise, that the person is knowledgeable about the portions of the Insurance Code applicable to the license;

(c) The person pays double the amount of the regular renewal fee; and

(d) The person satisfies all requirements for renewal.

(2) A person who does not renew an expired license as provided in this section may obtain a license only if the person applies and qualifies for and is issued the license in the same manner as a person who initially applies for the license. [1989 c.701 §6; 2001 c.191 §30]

744.010 [Repealed by 1967 c.359 §704]

744.011 Director’s authority to investigate licensee; qualification for license by person who voluntarily surrendered license. (1) The expiration of a license or the voluntary surrender of a license by a licensee under this chapter shall not deprive the Director of the Department of Consumer and Business Services of jurisdiction to proceed with any investigation of, or any action or disciplinary proceedings against, the licensee or to revise or render void an order suspending or revoking the license.

744.012 [1979 c.501 §1; 1989 c.701 §41; renumbered 744.240 in 1989]

744.013 Disciplinary actions against applicant, adjuster or insurance consultant. (1) If the Director of the Department of Consumer and Business Services finds with respect to an adjuster or insurance consultant or an applicant for an adjuster or insurance consultant license that one or more of the grounds set forth in subsection (2) of this section exist, the director may take the following disciplinary actions:

(a) The director may refuse to renew or may suspend or revoke a license issued under ORS 744.002 or the authority under a license to engage in any category of insurance business or any class of insurance.

(b) The director may refuse to issue a license under ORS 744.002 or refuse to grant authority under a license to engage in any category of insurance business or any class of insurance.

(2) The director may take any disciplinary action under subsection (1) of this section on one or more of the following grounds:

(a) Incompetence or untrustworthiness of the applicant or adjuster or insurance consultant.

(b) Falsification by the applicant or adjuster or insurance consultant of the application for the license or an amendment thereto, or engagement in any dishonest act in relation to the application or examination therefor.

(c) Violation of or noncompliance with any applicable provision of the Insurance Code or any rule or order of the director.

(d) Misappropriation or conversion to the adjuster’s or insurance consultant’s own use, or illegal withholding, of money or property belonging to policyholders, insurers, beneficiaries or others, and received by the adjuster or insurance consultant in the conduct of business under the license.

(e) Conviction, by final judgment, in any jurisdiction, of an offense which if committed in this state, constitutes a felony, a misdemeanor involving dishonesty or breach of trust, or an offense punishable by death or imprisonment under the laws of the United States. The record of the conviction shall be conclusive evidence of the conviction.

(f) Material misrepresentation of the terms of any insurance policy or proposed insurance policy.

(g) Use of a fraudulent or dishonest practice by the adjuster or insurance consultant in the conduct of business under the license, or demonstration therein that the adjuster or insurance consultant is incompetent, untrustworthy or a source of injury and loss to the public or others.

(h) Error by the director in issuing or renewing a license.

(i) Failure to pay a civil penalty assessed by the director that has become final by operation of law or upon appeal.

(j) Failure to pay any fee or charge to the director.

(k) Use of the license principally to effect insurance on property or against liability of the applicant or adjuster or insurance consultant, or to evade the provisions of ORS chapter 746.

(L) Cancellation, revocation, suspension or refusal to renew by any state of a license or other evidence of authority to act as an agent, adjuster or insurance consultant. The record of the cancellation, revocation, suspension or refusal to renew shall be conclusive evidence of the action taken.

(m) Cancellation, revocation, suspension or refusal to renew by any state or federal agency of the authority to practice law or to practice under any other regulatory authority if the cancellation, revocation, suspension or refusal to renew was related to the business of an agent, adjuster or insurance consultant or if dishonesty, fraud or deception was involved. The record of the cancellation, revocation, suspension or refusal to renew shall be conclusive evidence of the action taken.

(n) Failure to comply with continuing education requirements applicable to the license or any category of insurance authorized under the license, unless the director has waived the requirements.

(o) Dishonesty, fraud or misrepresentation not related to the business of an agent, adjuster or insurance consultant.

(3) The director may refuse to issue or renew or may revoke or suspend the license of a firm or corporation or may take any such action with respect to any authority applied for by or granted to the firm or corporation to engage under the license in any category of insurance business or class of insurance if the director finds that any ground set forth in subsection (2) of this section exists:

(a) With respect to any individual adjuster or insurance consultant employed by or under contract with the firm or corporation.

(b) With respect to a director or officer of the firm or corporation.

(c) With respect to any person who directly or indirectly has the power to direct or cause to be directed the management, control or activities of the adjuster or insurance consultant. [Formerly 744.255; 1991 c.810 §4; 1993 c.447 §84; 2001 c.191 §31]

744.014 Condition of probation on adjuster or insurance consultant license or category of insurance business; disciplinary action during probationary period. (1) The Director of the Department of Consumer and Business Services may place a condition of probation on an adjuster or insurance consultant license or on a category of insurance business authorized by a license or on a class of insurance if any ground for disciplinary action under ORS 744.013 exists, as follows:

(a) When the license is initially issued.

(b) When the license is renewed, amended or reinstated, or when a new license is issued for the purpose of adding a category of insurance business or class of insurance.

(c) At any time during the effective period of the license.

(2) During a probationary period under this section, the director may take any action authorized under ORS 744.013.

(3) A license applicant or licensee has the same right to a hearing on the placing of a condition of probation as the license applicant or licensee has with respect to any action taken by the director under ORS 744.013. [Formerly 744.260; 2001 c.191 §32]

744.015 [1967 c.359 §526; 1989 c.701 §22; renumbered 744.054 in 1989]

744.016 [Formerly 744.265; repealed by 2001 c.191 §61]

744.017 [1971 c.231 §8; 1989 c.701 §42; renumbered 744.245 in 1989]

744.018 Reinstatement of license; modification of suspension. With regard to any license issued under this chapter:

744.020 [Repealed by 1967 c.359 §704]

744.022 Authorized activities. (1) A firm or corporate adjuster or insurance consultant may engage in a category of insurance business or a class of insurance authorized on its license only through an individual adjuster or insurance consultant who is authorized to engage in insurance business in that same category or class.

744.024 Places of business for resident adjuster or insurance consultant; records. (1) Each resident adjuster or insurance consultant shall maintain in this state a place of business in which the licensee principally engages in insurance business under the license.

744.025 [1967 c.359 §527; 1971 c.385 §6; 1979 c.501 §3; 1979 c.829 §9a; 1981 c.247 §18; 1983 c.464 §1; 1985 c.762 §188; 1989 c.701 §23; renumbered 744.057 in 1989]

744.026 Place of business for nonresident adjuster or insurance consultant; records. (1) A nonresident adjuster or insurance consultant shall keep at the principal place of business of the licensee the usual and customary records pertaining to the business under the nonresident license. All such records as to any particular transaction shall be kept available and open to the inspection of the Director of the Department of Consumer and Business Services during business hours. For the purpose of this subsection, if a nonresident licensee has a place of transacting insurance in this state, that place shall be the principal place of business for the licensee.

744.028 Notice of change of address or telephone number. (1) Not later than the 30th day after an adjuster or insurance consultant changes the address or telephone number of the principal place of business or the residence of the adjuster or insurance consultant, or any other location at which the licensee transacts business under the license, the licensee shall notify the Director of the Department of Consumer and Business Services of the change. The licensee also shall so notify the director not later than the 30th day after the licensee opens or closes a location at which the licensee transacts business under the license.

744.030 [Amended by 1965 c.610 §12; repealed by 1967 c.359 §704]

744.031 Notice of personnel changes from firm or corporate adjuster or insurance consultant to director. (1) Not later than the 30th day after the authority of an individual adjuster or insurance consultant to act for a firm or corporate adjuster or insurance consultant has commenced or terminated, the firm or corporate adjuster or insurance consultant shall notify the Director of the Department of Consumer and Business Services of the commencement or termination.

744.033 Manner of application or notification. Any application or notice to the Director of the Department of Consumer and Business Services regarding the licensing of an adjuster or insurance consultant under this chapter must be made in the manner prescribed by the director. [1989 c.701 §20; 2001 c.191 §38]

744.035 [1967 c.359 §528; 1985 c.697 §18; repealed by 1989 c.701 §81]

744.037 Fees; refunds. A fee paid in connection with a license or a license application under this chapter is not refundable unless the Director of the Department of Consumer and Business Services provides otherwise by rule. [1989 c.701 §7; 2001 c.191 §44]

744.039 [1991 c.810 §22; 2001 c.191 §23; renumbered 744.077 in 2001]

744.040 [Repealed by 1967 c.359 §704]

744.045 [1967 c.359 §529; 1983 c.76 §2; 1987 c.916 §8; 1989 c.331 §33; 1989 c.701 §25; renumbered 744.066 in 1989]

744.050 [Repealed by 1953 c.93 §2]

744.051 [1989 c.701 §21; 1991 c.810 §5; repealed by 2001 c.191 §61]

744.052 Definitions for ORS 744.052 to 744.089. As used in ORS 744.052 to 744.089:

(1) "Business entity" has the meaning given that term in ORS 731.116.

(2) "Home state" means any state, district or territory of the United States, in which an insurance producer maintains the insurance producer’s principal place of residence or principal place of business and is licensed to act as an insurance producer.

(3) "Insurance producer" means a person required to be licensed under the laws of another state to sell, solicit or negotiate insurance.

(4) "Limited class credit insurance" includes credit life, credit disability, credit property, credit unemployment, involuntary unemployment, mortgage life, mortgage guaranty, mortgage disability, and guaranteed automobile protection insurance, and any other form of insurance offered in connection with an extension of credit that is limited to partially or wholly extinguishing the credit obligation that the Director of the Department of Consumer and Business Services determines should be designated a form of limited class credit insurance.

(5) "Limited class credit insurance agent" and "limited class credit insurance producer" mean a person required to be licensed to sell, solicit or negotiate one or more forms of limited class credit insurance coverage to individuals through a master, corporate, group or individual policy.

(6) "Limited class insurance" includes credit, mortgage, automobile dealer guaranteed automobile protection and any other form of insurance designated by the director as a form of limited class insurance.

(7) "Limited class insurance agent" and "limited class insurance producer" mean a person required to be licensed to sell, solicit or negotiate one or more forms of limited class insurance coverage to individuals through a master, corporate, group or individual policy.

(8) "Negotiate," "sell" and "solicit" have the meanings given those terms in ORS 731.062, except that for an insurance producer, "negotiate" applies to a person engaged in negotiation who obtains insurance from insurers for purchasers as well as to a person engaged in negotiation who sells insurance.

(9) "Terminate" means to cancel the relationship between an insurance agent and the insurer or to cancel an agent’s authority to sell, solicit or negotiate insurance.

(10) "Uniform Application" means the current version of the Uniform Application for resident and nonresident insurance producer licensing, produced by the National Association of Insurance Commissioners.

(11) "Uniform Business Entity Application" means the current version of the Uniform Business Entity Application for resident and nonresident business entities, produced by the National Association of Insurance Commissioners. [2001 c.191 §2]

744.053 Requirements to be licensed as agent for class of insurance. A person shall not sell, solicit or negotiate insurance in this state for any class or classes of insurance unless the person is licensed as an agent for that class or those classes in accordance with ORS 744.052 to 744.089. [2001 c.191 §3]

744.054 [Formerly 744.015; 1991 c.810 §6; repealed by 2001 c.191 §61]

744.055 [1967 c.359 §530; 1971 c.231 §27; 1987 c.222 §1; 1989 c.701 §27; renumbered 744.071 in 1989]

744.056 Exemptions from agent licensing requirements. (1) ORS 744.052 to 744.089 do not require an insurer to obtain a license as an agent as required by ORS 744.053. For purposes of this section, the term "insurer" does not include an insurer’s officers, directors, employees, subsidiaries or affiliates.

(2) A license as an agent shall not be required of any of the following:

(a) An officer, director or employee of an insurer, an agent or an insurance producer, if the officer, director or employee does not receive any commission on or fee for policies written or sold to insure risks residing, located or to be performed in this state and:

(A) The officer’s, director’s or employee’s activities are executive, administrative, managerial, clerical or a combination of these, and are only indirectly related to the sale, solicitation or negotiation of insurance;

(B) The officer’s, director’s or employee’s function relates to underwriting, loss control, inspection or the processing, adjusting, investigating or settling of a claim on a contract of insurance; or

(C) The officer, director or employee is acting in the capacity of an agency supervisor assisting licensed agents or insurance producers when the person’s activities are limited to providing technical advice and assistance to licensed agents or insurance producers and do not include the sale, solicitation or negotiation of insurance.

(b) A person who does either of the following, when the person does not receive any commission or fee for the service:

(A) Secures and furnishes information for the purpose of group life insurance, group property and casualty insurance, group annuities or group or blanket health insurance or for the purpose of enrolling individuals under plans, issuing certificates under plans or otherwise assisting in administrative plans; or

(B) Performs administrative services related to mass-marketed property and casualty insurance.

(c) An employer or an association of employers or its officers, directors or employees, or the trustees of an employee trust plan:

(A) To the extent that the employers, associations, directors, officers, employees or trustees are engaged in the administration or operation of a program of employee benefits for the employer’s or association’s own employees or the employees of its subsidiaries or affiliates;

(B) To the extent that the program of employee benefits involves the use of insurance issued by an insurer; and

(C) As long as the employers, associations, officers, directors, employees or trustees are not in any manner compensated, directly or indirectly, by the insurer issuing the insurance.

(d) An employee of an insurer or an organization employed by insurers who is engaging in the inspection, rating or classification of risks, or in the supervision of the training of agents or insurance producers and who is not individually engaged in the sale, solicitation or negotiation of insurance.

(e) A person whose activities in this state are limited to advertising without the intent to solicit insurance in this state through communications in printed publications or electronic mass media, the distribution of which is not limited to residents of this state, but only if the person does not sell, solicit or negotiate insurance that would insure risks residing, located or to be performed in this state.

(f) A person who is not a resident of this state who sells, solicits or negotiates a policy of insurance for commercial property and casualty risks to an insured with risks located in more than one state insured under that policy, but only if the person is otherwise licensed as an insurance producer to sell, solicit or negotiate that insurance in the state where the insured maintains its principal place of business and the contract of insurance insures risks located in that state.

(g) A salaried full-time employee who counsels or advises the employer of the employee relative to the insurance interests of the employer or of the subsidiaries or business affiliates of the employer, but only if the employee does not sell or solicit insurance or receive any commission.

(h) An attorney in fact of an authorized reciprocal insurer, or the salaried representative of the insurer or attorney who does not receive any commission.

(i) A person engaging in the lawful transaction of reinsurance.

(j) Salaried employees of title insurance agents or insurers, except for the individual or individuals designated as exercising the powers conferred by a title insurance agent’s license.

(k) Any agent or representative of persons exempt from the Insurance Code under ORS 731.032 or 731.036, with respect to the exempted transactions.

(L) Any agent or representative of a fraternal benefit society who devotes, or intends to devote, less than 50 percent of the agent’s or representative’s time to the solicitation and procurement of insurance policies for that society. Any person who in the preceding calendar year has solicited and procured life insurance policies on behalf of any fraternal benefit society for an amount of insurance in excess of $50,000 or, in the case of any other class or classes of insurance that the society might write, on the persons of more than 25 individuals, and who has received or will receive a commission or other compensation therefor, shall be presumed to be devoting, or intending to devote, 50 percent or more of the person’s time to the solicitation and procurement of insurance policies for that society.

(m) A person engaging in the lawful transaction of home protection insurance if the person is a real estate licensee as defined in ORS 696.010, and if the transaction of such insurance by the person is subject to a written contract, to which the insurer is a party, governing the person’s activities in the transaction.

(n) Salaried employees of a financial institution or trust company, as those terms are defined in ORS 706.008, who, in the regular course of business with the customers of the financial institution or trust company, present the customers with written information about savings account annuities issued by an authorized insurer. Any person who purchases such an annuity may rescind the transaction within 10 days after the issuance of the contract. For purposes of this paragraph, "savings account annuities" means annuities purchased with the proceeds of a savings account, certificate or share in a financial institution or trust company.

(3) A person who provides general insurance advice in connection with providing other professional services such as legal services, trust services, tax and accounting services, financial planning or investment advisory services is not considered to be soliciting the sale of insurance for the purpose of the definition of "agent" in ORS 731.062.

(4) Except as provided in ORS 735.450, 744.063 and 744.064, the provisions of this chapter relating to agents do not apply to a surplus lines agent authorized pursuant to ORS 735.450. [2001 c.191 §4]

744.057 [Formerly 744.025; 1997 c.631 §547; 1999 c.59 §227; repealed by 2001 c.191 §61]

744.058 Written examination; fees; rules. (1) An individual applying for a resident agent license must pass a written examination unless the individual is exempt from the prelicensing education and examination requirement as provided in ORS 744.067. The examination must test the knowledge of the individual concerning the class or classes of insurance for which application is made, the duties and responsibilities of an agent and the insurance statutes and rules of this state. Except as provided in subsection (2) of this section, the examination required by this section shall be developed and conducted by the Director of the Department of Consumer and Business Services. An individual may apply for a resident agent license only if the individual has established in this state a residence or a place of business for acting as an agent.

(2) The director may make arrangements, including contracting with a private testing service, for developing and administering the examination and collecting applicable fees.

(3) Each individual applying to take an examination shall pay fees as established by the director.

(4) An individual who fails to appear for the examination as scheduled or fails to pass the examination may reapply to take the examination according to requirements and procedures established by the director by rule. [2001 c.191 §5]

744.059 Qualifications for license; use of uniform application. (1) An individual applying for a resident agent license shall apply to the Director of the Department of Consumer and Business Services on the Uniform Application and shall declare that the statements made in the application are true, correct and complete to the best of the individual’s knowledge and belief. Before approving the application, the director must find that the individual:

(b) Has not committed an act that is a ground for action on a license set forth in ORS 744.074;

(c) When required by the director, has completed a prelicensing course of study for the lines of authority for which the person has applied;

(d) Has paid all applicable fees; and

(e) Has successfully passed the examination for the lines of authority for which the person has applied.

(2) A business entity acting as an agent is required to obtain an agent license. Application shall be made on the Uniform Business Entity Application. Before approving the application, the director must find that:

(a) The business entity has paid all applicable fees; and

(b) The business entity has designated a licensed agent responsible for the business entity’s compliance with the insurance laws and rules of this state.

(3) The director may require any documents necessary to verify the information contained in an application.

(4) Each insurer that sells, solicits or negotiates any form of limited class credit insurance shall provide to each limited class credit insurance agent a program of instruction, which is subject to review and approval by the director. [2001 c.191 §6]

744.060 [Repealed by 1953 c.93 §2]

744.061 Banking institution as agent. Nothing in the Insurance Code shall be construed to limit or prohibit the licensing of a banking institution, as defined in ORS 706.008, a corporation owned in whole or part by a banking institution under ORS 708A.120, 716.588 or 716.594, or a corporation owned in whole or part by a financial holding company or a bank holding company, as defined in ORS 706.008, as an agent to transact one or more of the classes of insurance described in ORS 744.062, except for title insurance. [1989 c.701 §24; 1997 c.631 §548; 2001 c.191 §24; 2001 c.377 §51]

744.062 Issuance of agent license. (1) Unless the Director of the Department of Consumer and Business Services refuses to issue or renew a license pursuant to ORS 744.074, a person who has met the requirements of ORS 744.058 and 744.059, or ORS 744.063, shall be issued an agent license. An agent may receive qualification for a license in one or more of the following classes of insurance:

(a) Life insurance as defined in ORS 731.170.

(b) Health insurance as defined in ORS 731.162.

(c) Property insurance as defined in ORS 731.182.

(d) Casualty insurance as defined in ORS 731.158.

(e) Variable life insurance, including variable annuities.

(f) Property and casualty insurance coverage sold to individuals and families for primarily noncommercial purposes.

(g) Limited class credit insurance.

(h) Any form of insurance designated by the director as a form of limited class insurance.

(i) Title insurance as defined in ORS 731.190. A license for the class of title insurance may be issued only to a resident agent.

(j) Any other class of insurance permitted under the Insurance Code or rules adopted thereunder.

(2) For assistance in performance of the director’s duties, the director may participate with the National Association of Insurance Commissioners, or any affiliate or subsidiary that the National Association of Insurance Commissioners oversees, in a centralized producer licensing registry in which insurance agent and producer licenses and appointments are centrally or simultaneously effected for all states that require an insurance producer license. The director may adopt by rule any uniform standards and procedures as are necessary to participate in the registry, including the centralized collection of fees for licenses or appointments that are processed through the registry.

(3) An agent may apply to amend a license for the purpose of adding or deleting a class of insurance on the license in the manner prescribed for license application in ORS 744.059 or 744.063, or as otherwise prescribed by the director. [2001 c.191 §8]

744.063 Nonresident agent license. (1) Unless the Director of the Department of Consumer and Business Services refuses to issue or renew a license pursuant to ORS 744.074, a nonresident person shall receive a nonresident agent license if:

(a) The person is currently licensed as a resident insurance producer and is in good standing in the person’s home state;

(b) The person has submitted the proper request for a nonresident agent license and has paid the applicable fees;

(c) The person has submitted or transmitted to the director the resident insurance producer license application that the person submitted to the person’s home state, or in lieu of that application, a completed Uniform Application;

(d) The person has filed with the director, in writing, an appointment of the director to be the attorney of the person upon whom all legal process in any action or proceeding against the person may be served. In the appointment, the person must agree that any lawful process against the person that is served upon the director shall be of the same legal force and validity as if served upon the applicant, and that the authority shall continue in force so long as any liability remains outstanding in this state. An appointment under this paragraph becomes effective on the date that the director issues the nonresident agent license to the applicant; and

(e) The person’s home state grants nonresident insurance producer licenses to residents of this state on the same basis.

(2) The director may verify the insurance producer’s licensing status through the Producer Database maintained by the National Association of Insurance Commissioners, its affiliates or subsidiaries.

(3) A nonresident agent licensed in this state who moves from one state to another state or a resident agent who moves from this state to another state shall file with the director a change of address and provide certification from the new resident state not later than the 30th day after the change of legal residence. No fee or license application is required under this subsection.

(4) A person licensed as a surplus lines insurance producer in the person’s home state shall receive a nonresident surplus lines agent license pursuant to subsection (1) of this section. Except as provided in subsection (1) of this section, nothing in this section supersedes any provision of ORS 735.400 to 735.495.

(5) Notwithstanding any other provision of ORS 744.052 to 744.089, the director shall issue a nonresident limited class insurance agent license pursuant to subsection (1) of this section to a person who is licensed as a limited class credit insurance producer or as another type of limited class insurance producer under the laws of the person’s home state that restrict the authority of the license to less than the authority prescribed in ORS 744.062 for the classes of life insurance, health insurance, property insurance or casualty insurance.

(6) A license for the class of title insurance may not be issued to a nonresident agent. [2001 c.191 §7]

744.064 Persons licensed elsewhere. (1) Unless denied a license pursuant to ORS 744.074, a person who is currently licensed as a resident insurance producer in a Canadian province, in Mexico or in a state that does not grant nonresident producer licenses to residents of this state on the same basis that this state grants nonresident agent licenses under ORS 744.063 shall receive a nonresident agent license if the insurance regulator in the person’s place of residence grants nonresident insurance producer licenses to residents of this state on the same basis and if the person meets all of the following requirements:

(a) The person is in good standing as a resident agent in the person’s place of residence in Canada, Mexico or the person’s state of residence.

(b) The person has submitted the proper request for a nonresident agent license and has paid the applicable fees.

(c) The person has submitted or transmitted to the Director of the Department of Consumer and Business Services the resident agent license application that the person submitted to the insurance regulator in the person’s place of residence, or in lieu of that application, a completed Uniform Application.

(d) The person has taken and passed a written examination specified by the director under this section with respect to the authority to transact the class or classes of insurance for which the applicant has applied. The requirement of an examination does not apply to an applicant that is a business entity.

(e) The person has submitted or transmitted to the director an appointment of the director to be the attorney of the person upon whom all legal process in any action or proceeding against the person may be served. In the appointment, the person must agree that any lawful process against the person that is served upon the director shall be of the same legal force and validity as if served upon the person, and that the authority shall continue in force so long as any liability remains outstanding in this state. An appointment under this paragraph becomes effective on the date that the director issues the nonresident agent license to the person.

(f) The person has satisfied any other qualifications established by the director by rule or has satisfied qualifications that the director establishes by rule in lieu of the qualifications established in this subsection.

(2) A person who is licensed by this state to sell, solicit or negotiate insurance as a nonresident agent under this section may sell, solicit or negotiate any policy of insurance upon domestic risks to the same extent and upon the same terms as provided by the insurance regulator in the person’s place of residence for residents of this state transacting a like business in a province of Canada, in Mexico or in the person’s state of residence.

(3) The examination requirement under subsection (1) of this section is subject to waiver if the director has entered into a reciprocal agreement as provided in subsection (4) of this section with the insurance regulator in the person’s place of residence.

(4) The director may enter into a reciprocal agreement with the appropriate insurance regulator in a province of Canada or in Mexico that waives any or all of the requirements for issuance of a license under this section if:

(a) A written examination is required of applicants for a resident agent license in the jurisdiction of the insurance regulator;

(b) The insurance regulator of the other jurisdiction certifies that the applicant holds a valid license as a resident insurance producer in the other jurisdiction and either passed the written examination or was the holder of a resident insurance producer license prior to the time the written examination was first required; and

(c) In the other jurisdiction, a resident of this state is privileged to procure an insurance producer license upon conditions no less favorable than the conditions stated in this section.

(5) The director shall establish the form of the nonresident agent license issued under this section. [2001 c.191 §9]

744.065 [1967 c.359 §531; 1969 c.336 §14; 1973 c.89 §1; 1983 c.76 §3; 1989 c.413 §10; repealed by 1989 c. 701 §81]

744.066 [Formerly 744.045; repealed by 2001 c.191 §61]

744.067 Exemptions from prelicensing education or examination requirement. (1) An individual who applies for a resident agent license in this state who is or was previously licensed as an insurance producer for the same lines of authority in another state is not required to complete any prelicensing education or examination. The exemption under this subsection is available only if the individual is currently licensed in the other state or if the application is received by the Director of the Department of Consumer and Business Services not later than the 90th day after the applicant’s previous license was terminated and if the other state issues a certification that, at the time of termination, the applicant was in good standing in that state or the state’s Producer Database maintained by the National Association of Insurance Commissioners, its affiliates or subsidiaries indicate that the applicant is or was licensed in good standing for the class of insurance requested.

(2) A person licensed as an insurance producer in another state who moves to this state must apply for a resident agent license not later than the 90th day after the date on which the person established legal residence in order to qualify for a resident agent license pursuant to ORS 744.059. Neither prelicensing education nor an examination is required of a person to whom this subsection applies in order to obtain a license in a class of insurance described in ORS 744.062 if the person held a license in that class in the other state, except when the director has determined otherwise by rule.

(3) An individual who holds an industry designation described in this subsection is not required to complete prelicensing education or the examination required in ORS 744.058 if the director is satisfied, by examination or otherwise, that the applicant is knowledgeable in the particulars of the applicable provisions of the Insurance Code. This subsection applies to:

(a) An applicant for a license authorizing the applicant to transact property or casualty insurance or both, upon whom the American Institute for Chartered Property Casualty Underwriters has conferred the Chartered Property Casualty Underwriter (C.P.C.U.) designation.

(b) An applicant for a license authorizing the applicant to transact life or health insurance, or both, upon whom the American College has conferred the Chartered Life Underwriter (C.L.U.) designation.

(4) The director may recognize one or more industry designations as exempting an applicant from the prelicensing education requirement or the examination required in ORS 744.058 or both. For each industry designation that the director recognizes and for the extent of the exemption to be given, the director shall consider the content, quality and scope of the educational program required for the designation as well as other factors determined by the director to be relevant.

(5) An individual is not required to complete prelicensing education or the examination required in ORS 744.058 or 744.064 for the following licenses:

(a) A license authorizing the individual to transact a type of limited class insurance, except as the director otherwise provides by rule.

(b) A license authorizing the individual to transact title insurance. [2001 c.191 §10]

744.068 Required notifications; maintenance of usual and customary records. (1) An agent shall notify the Director of the Department of Consumer and Business Services prior to transacting business under the agent license under any name other than the agent’s legal name and prior to changing, deleting or adding an assumed business name in connection with the agent’s business under the agent license.

744.069 [1989 c.701 §26; repealed by 2001 c.191 §61]

744.070 [Amended by 1967 c.359 §480; renumbered 743.603]

744.071 [Formerly 744.055; repealed by 2001 c.191 §61]

744.072 Renewal of agent license; rules. (1) An agent license remains in effect unless revoked or suspended as long as all applicable fees are paid by the due date and, if the licensee is a resident individual agent, as long as the licensee has met applicable continuing education requirements for resident individual agents under subsection (4) of this section by the due date. The renewal fee is due on the last day of the month in which the second anniversary of the initial issuance date of the license occurs and on the second anniversary following each renewal. The Director of the Department of Consumer and Business Services may establish another renewal period for the purpose of coordination with any national registration or licensing system.

(2) As a condition for or in connection with the renewal of an agent license the director may require the agent to file information with the director regarding use made of the license during the previous year or two years, and especially showing whether the license has been used principally for the writing of personal or controlled insurance, as defined in ORS 746.065.

(3) The director may require an agent, as a condition for renewal of the agent license, to fulfill any or all of the requirements then applicable to the original issuance of the license.

(4) The director by rule may establish requirements for continuing education that each resident individual agent must satisfy as a condition for renewing the resident agent license. The hours of education so required shall not exceed 45 hours annually during the first five years an individual is licensed, 24 hours annually during the next five years an individual is licensed, and 12 hours annually for individuals licensed for more than 10 years or for individuals who have received the designation C.P.C.U., C.L.U. or comparable designation recognized by the director. Continuing education shall not be required for:

(a) Any person to whom a license is issued without examination pursuant to ORS 744.067 (4);

(b) Any retired person who is authorized to transact life insurance only, if the person is 58 years of age or more, has 10 years’ experience as a licensed agent, will be servicing existing policies only and requests an exemption from the requirement; or

(c) Any person whose license is indorsed to authorize the person to act as an intermediary broker or intermediary manager, or both, as described in ORS 744.800, but the exemption applies solely for the purpose of maintaining the indorsement and does not affect any continuing education requirement that otherwise applies.

(5) In connection with establishing continuing education requirements under subsection (4) of this section, the director may make arrangements, including contracting with a private service, for establishing and operating a program and standards for approving and registering continuing education programs and their providers.

(6) An individual agent who allows the agent license to lapse may reinstate the same license within 24 months from the due date for renewal without having to take and pass a written examination, but the agent must pay an amount equal to double the unpaid renewal fee for any renewal fee paid after the due date and must complete any continuing education requirements not satisfied to date.

(7) An individual agent who is unable to comply with license renewal procedures due to military service or another extenuating circumstance such as a long term medical disability may request a waiver from compliance with those procedures. The agent may also request a waiver of any examination requirement or any penalty imposed for failure to comply with renewal procedures. [2001 c.191 §12]

744.073 Temporary agent license. (1) The Director of the Department of Consumer and Business Services may issue a temporary agent license for a period not to exceed 180 days without requiring a written examination if the director determines that the temporary license is necessary for the servicing of an insurance business in the following cases:

744.074 Authority of director to place licensee on probation or to suspend, revoke or refuse to issue or renew license. (1) The Director of the Department of Consumer and Business Services may place a licensee on probation or suspend, revoke or refuse to issue or renew an agent license and may take other actions authorized by the Insurance Code in lieu thereof or in addition thereto, for any one or more of the following causes:

(2) If the director refuses to issue or renew an agent license, the director shall notify the applicant or licensee and inform the applicant or licensee in writing of the reason for the refusal to issue or renew and of the applicant’s or licensee’s rights under ORS 183.310 to 183.550.

(3) The director may suspend, revoke or refuse to issue or renew the agent license of a business entity if the director determines that an individual licensee’s violation was known or should have been known by one or more of the partners, officers or managers acting on behalf of the partnership or corporation but the violation was not reported to the director and corrective action was not taken. [2001 c.191 §14]

744.075 [1967 c.359 §532; 1983 c.76 §4; 1989 c.701 §28; 1991 c.810 §7; repealed by 2001 c.191 §61]

744.076 Payment of commission, service fee or brokerage. (1) An insurer or agent may not pay a commission, service fee, brokerage or other valuable consideration to a person for selling, soliciting or negotiating insurance in this state if that person is required to be licensed as an agent and is not so licensed.

(4) An insurer or agent may pay or assign commissions, service fees, brokerages or other valuable consideration to an insurance agency or to persons who do not sell, solicit or negotiate insurance in this state, except when the payment or assignment would violate ORS 746.045 or 746.055. [2001 c.191 §15]

744.077 Conditions under which person licensed as agent and consultant may accept commission or fee; rules. (1) The Director of the Department of Consumer and Business Services shall establish by rule the conditions under which a person who is licensed as an agent and as an insurance consultant may accept a commission or a fee, or both, in a transaction or in related transactions. The director may establish different conditions for such products as employee benefit plans, insurance for personal, family or household purposes and insurance for commercial purposes, and for any other insurance product as determined appropriate by the director. In developing rules under this subsection, the director shall take into account the requirements and characteristics of the different insurance products and the varying degrees of trade practice regulation needed.

(2) Except as otherwise provided by rule, an agent who is not licensed as an insurance consultant may receive only commission. [Formerly 744.039]

744.078 Appointment of agents. (1) An agent shall not act as an agent of an insurer unless the agent is an appointed agent of that insurer.

744.079 Termination of relationship with agent. (1) An insurer or authorized representative of the insurer who terminates the appointment, employment, contract or other insurance business relationship with an agent shall notify the Director of the Department of Consumer and Business Services not later than the 30th day after the effective date of the termination, in the manner prescribed by the director, if the reason for termination is one of the reasons set forth in ORS 744.074 or if the insurer has knowledge that the agent was found by a court, government body or self-regulatory organization authorized by law to have engaged in any of the activities set forth in ORS 744.074. Upon the written request of the director, the insurer shall provide additional information, documents, records or other data pertaining to the termination or activity of the agent.

(2) An insurer or authorized representative of the insurer who terminates the appointment, employment, contract or other insurance business relationship with an agent for any reason not set forth in ORS 744.074 shall notify the director not later than the 30th day after the effective date of the termination, in the manner prescribed by the director. Upon the written request of the director, the insurer shall provide additional information, documents, records or other data pertaining to the termination or activity of the agent.

(3) An insurer or the authorized representative of the insurer shall promptly notify the director in a manner acceptable to the director if, upon further review or investigation, the insurer discovers additional information that would have been reportable to the director in accordance with subsection (1) of this section if the insurer had then known of its existence.

(4) Not later than the 15th day after making a notification required by subsection (1), (2) or (3) of this section, the insurer shall mail a copy of the notification to the agent at the agent’s last known business address. If the agent is terminated for cause for any of the reasons listed in ORS 744.074, the insurer shall provide a copy of the notification to the agent at the agent’s last known business address by certified mail, return receipt requested, postage prepaid or by overnight delivery using a nationally recognized carrier.

(5) Not later than the 30th day after the agent has received a notification under subsection (4) of this section, the agent may file with the director written comments concerning the substance of the notification. The agent shall, by the same means, simultaneously send a copy of the comments to the reporting insurer. The comments shall become a part of the director’s file and shall accompany every copy of a report distributed or disclosed for any reason about the agent as allowed under subsection (6) of this section.

(6) In the absence of actual malice, an insurer, the authorized representative of the insurer, an agent, the director or an organization of which the director is a member and that compiles the information and makes it available to other insurance regulators or regulatory or law enforcement agencies shall not be subject to civil liability. In the absence of actual malice, a civil cause of action shall not arise against any such entity or its agents or employees as a result of any statement or information required by or provided pursuant to this section, or any information relating to any statement that may be requested in writing by the director from an insurer or agent, or relating to a statement by a terminating insurer or agent to an insurer or agent, that is limited exclusively to whether a termination for cause under subsection (1) of this section was reported to the director. Immunity under this subsection is available only if the propriety of any termination for cause under subsection (1) of this section is certified in writing by an officer or authorized representative of the insurer terminating the relationship.

(7) In any action brought against a person who may have immunity under subsection (6) of this section for making any statement required by this section or providing any information relating to any statement that may be requested in writing by the director, the party bringing the action must plead specifically in any allegation that subsection (6) of this section does not apply because the person making the statement or providing the information did so with actual malice.

(8) Subsections (6) and (7) of this section do not abrogate or modify any existing statutory or common law privileges or immunities.

(9) The director may take any administrative action authorized by the Insurance Code, including suspension or revocation of a license or certificate of authority, against an insurer, the authorized representative of an insurer or an agent who fails to file notice as required by this section or who is found by a court of competent jurisdiction to have filed notice with actual malice.

(10) Any information, documents, records or other data in the control or possession of the director that are furnished by an insurer or an agent, or an employee or agent thereof acting on behalf of the insurer or agent, or that are obtained by the director in an investigation pursuant to this section shall be confidential, shall not be subject to subpoena and shall not be subject to discovery nor admissible in evidence in any private civil action. The director, however, may use the confidential information, documents, records or other data in administering this section and in the furtherance of any other regulatory or legal action brought as a part of the director’s duties. The information, documents, records or other data referred to in this subsection are subject to the public officer privilege described in ORS 40.270. [2001 c.191 §17]

744.080 [Repealed by 1967 c.359 §704]

744.081 Termination of appointment. (1) An insurer may terminate an agency appointment at any time as provided in this section. Termination shall be without prejudice to the contract rights, if any, of the agent so terminated. The insurer shall give written notice of the termination and the date thereof to the agent at least 90 days prior to the effective date of the termination. The notice must specify the reasons for the termination. The insurer shall deliver the notice either in person or by mail at the address last provided by the agent to the insurer. The agent shall not have a cause of action against the insurer as a result of any statement in the notice unless the statement is false and the insurer knew the statement was false when made.

(3) An agent may terminate an agency appointment at any time, but the termination shall be without prejudice to the contract rights, if any, of the appointing insurer. The agent shall give written notice of the termination and the date thereof to the director not later than the 30th day after the effective date of the termination, and to the insurer. The director may require reasonable proof from the agent that the agent has given such notice to the insurer. [Formerly 744.175]

744.082 Waiver of requirement for nonresident agent license applicant. The Director of the Department of Consumer and Business Services shall waive any requirement for a nonresident agent license applicant with a valid resident insurance producer license from the applicant’s home state, except the requirements imposed by ORS 744.063, if the applicant’s home state grants nonresident insurance producer licenses to residents of this state on the same basis. [2001 c.191 §18]

744.083 Trust account for premium funds; commingling; exceptions. (1) All premium funds received by a resident agent shall be accounted for and maintained in a trust account separate from all other business and personal funds.

(a) Any financial institution or trust company, as those terms are defined in ORS 706.008, or any entity licensed under ORS chapter 725 or 726.

(b) Any class of agents that the Director of the Department of Consumer and Business Services designates by rule. The director may exempt a class of agent from this section if the director determines that the requirements of this section are unduly burdensome to the agents in relation to the public good served. [Formerly 744.225]

744.084 Certificate of deposit in lieu of trust account. (1) In lieu of the trust account required by ORS 744.083, a resident agent may keep a certificate of deposit from an institution insured by the federal government or an instrumentality thereof if the resident agent has an average monthly balance of premium funds received and held for the last 12 months of at least $2 million. A resident agent who keeps a certificate of deposit shall have satisfactory evidence of the certificate available at all times for inspection by the Director of the Department of Consumer and Business Services.

(2) A certificate of deposit authorized under subsection (1) of this section shall be for an amount at least equal to the average monthly balance of premium funds received and held by the resident agent for the last 12 months. Nothing in this subsection requires that the required amount of the certificate of deposit be calculated, or the amount changed, more often than once a month.

(3) The director may adopt rules specifying what constitutes satisfactory evidence for purposes of subsection (1) of this section.

(4) Authorization to use a certificate of deposit may be revoked by the director at any time upon a determination that the resident agent has failed to comply with the provisions of this section or rules adopted under subsection (3) of this section. Upon revocation, the resident agent shall comply immediately with the provisions of ORS 744.083. [Formerly 744.227]

744.085 [1967 c.359 §533; 1971 c.231 §28; 1977 c.174 §1; 1977 c.820 §1; 1979 c.501 §4; 1981 c.817 §1; 1983 c.76 §5; 1989 c.701 §29; 1991 c.810 §8; 1993 c.447 §85; 1995 c.334 §1; repealed by 2001 c.191 §61]

744.086 Applicability of Insurance Code to title insurance agents. The Legislative Assembly finds that it is in the interest of the insurance-buying public that agents authorized to transact title insurance be subject to the Insurance Code. It is declared to be the intent of the Legislative Assembly that the Insurance Code shall apply to such agents only to the extent necessary for the regulation of title insurance ratemaking and unfair trade practices. [Formerly 744.240]

744.087 Filing agents compensation agreements; filing not public record. The Director of the Department of Consumer and Business Services may require the filing by an insurer of any compensation agreements for agents. No such filing shall be deemed a "public record" as defined in ORS 192.410. [Formerly 744.245]

744.089 Report of administrative action taken against agent. (1) An agent shall report to the Director of the Department of Consumer and Business Services any administrative action taken against the agent in another jurisdiction or by another governmental agency in this state not later than the 30th day after the date of the final disposition of the matter. This report shall include a copy of the order, consent to order and other relevant legal documents.

744.090 [Amended by 1967 c.359 §370; renumbered 743.111]

744.095 [1967 c.359 §534; repealed by 1989 c.701 §81]

744.100 [Repealed by 1967 c.359 §704]

744.105 [1967 c.359 §535; 1971 c.231 §29; repealed by 1989 c.701 §81]

744.110 [Repealed by 1967 c.359 §704]

744.115 [1967 c.359 §536; 1971 c.231 §30; 1973 c.515 §3; 1977 c.174 §2; 1979 c.501 §5; 1981 c.817 §2; 1987 c.774 §138; 1987 c.916 §9; 1989 c.331 §25; 1989 c.701 §30; 1991 c.810 §9; 1993 c.265 §7; 1995 c.334 §2; repealed by 2001 c.191 §61]

744.119 [Formerly 744.205; 1991 c.810 §10; 1993 c.447 §86; 1997 c.131 §4; repealed by 2001 c.191 §61]

744.120 [Repealed by 1967 c.359 §704]

744.123 [Formerly 744.195; repealed by 2001 c.191 §61]

744.125 [1959 c.367 §1; 1967 c.359 §501; renumbered 743.666]

744.127 [1989 c.701 §33; 1991 c.810 §11; repealed by 2001 c.191 §61]

744.130 [Amended by 1955 c.226 §1; 1967 c.359 §502; renumbered 743.669]

744.135 [1967 c.359 §537; 1973 c.89 §2; repealed by 1989 c.701 §81]

744.140 [Repealed by 1967 c.359 §704]

744.145 [1967 c.359 §538; 1989 c.701 §35; repealed by 2001 c.191 §61]

744.150 [Repealed by 1967 c.359 §704]

744.155 [1967 c.359 §539; 1971 c.231 §31; 1975 c.769 §5; 1989 c.413 §11; 1989 c.701 §§34,81c; 1993 c.265 §8; repealed by 2001 c.191 §61]

744.160 [Repealed by 1967 c.359 §704]

744.165 [Formerly 739.520; 1971 c.231 §32; 1983 c.265 §1; repealed by 2001 c.191 §61]

744.170 [Repealed by 1967 c.359 §704]

744.175 [1967 c.359 §541; 1975 c.769 §6; 1989 c.692 §§1,2; 1989 c.701 §36; 2001 c.191 §24a; renumbered 744.081 in 2001]

744.180 [Repealed by 1967 c.359 §704]

744.182 [1989 c.701 §37; 1995 c.639 §5; repealed by 2001 c.191 §61]

744.185 [1967 c.359 §542; repealed by 1989 c.701 §81]

744.190 [Repealed by 1967 c.359 §704]

744.195 [1967 c.359 §543; 1989 c.413 §12; 1989 c.701 §§32,81d; renumbered 744.123 in 1989]

744.200 [Repealed by 1967 c.359 §704]

744.205 [1967 c.359 §544; 1977 c.820 §2; 1979 c.501 §6; 1981 c.817 §3; 1983 c.76 §6; 1989 c.701 §31; renumbered 744.119 in 1989]

744.215 [1967 c.359 §545; 1989 c.413 §13; 1989 c.701 §40; renumbered 744.235 in 1989]

744.225 [1987 c.569 §2; 1989 c.701 §38; 1997 c.631 §549; 2001 c.191 §24b; renumbered 744.083 in 2001]

744.227 [1989 c.680 §2; 2001 c.191 §24c; renumbered 744.084 in 2001]

744.231 [1989 c.701 §39; repealed by 2001 c.191 §61]

744.235 [Formerly 744.215; repealed by 1993 c.265 §14]

744.240 [Formerly 744.012; renumbered 744.086 in 2001]

744.245 [Formerly 744.017; 1999 c.55 §4; renumbered 744.087 in 2001]

744.255 [1967 c.359 §546; 1969 c.336 §15; 1983 c.76 §7; 1985 c.697 §15; 1987 c.774 §141; 1989 c.701 §8; renumbered 744.013 in 1989]

744.260 [1971 c.231 §9; 1983 c.76 §8; 1985 c.697 §16; 1989 c.701 §9; renumbered 744.014 in 1989]

744.265 [1967 c.359 §547; 1983 c.76 §9; 1989 c.701 §10; renumbered 744.016 in 1989]

744.300 License and indorsement; managing general agent described. (1) A person shall not act as a managing general agent with respect to risks located in this state for an authorized insurer unless the person holds a license issued under ORS 744.062 authorizing the person to act as an agent and indorsed to authorize the person to act as a managing general agent.

(2) A person shall not act as a managing general agent representing a domestic insurer with respect to risks located outside this state unless the person holds a license issued under ORS 744.062 authorizing the person to act as an agent and indorsed to authorize the person to act as a managing general agent.

(3) For purposes of ORS 744.300 to 744.316, a person acts as a managing general agent when the person:

(a) Negotiates and binds ceding reinsurance contracts on behalf of an authorized insurer or manages all or part of the insurance business of an authorized insurer, including the management of a separate division, department or underwriting office, and acts as an agent for the insurer, whether the person is known as a managing general agent, manager or other similar term; and

(b) With or without the authority, either separately or together with affiliates, produces, directly or indirectly, and underwrites an amount of gross direct written premium equal to or more than five percent of the policyholder surplus as reported in the last annual statement of the insurer in any one quarter or year, together with either or both of the following activities:

(A) Adjusting or paying claims in excess of an amount determined by the Director of the Department of Consumer and Business Services.

(B) Negotiating reinsurance on behalf of the insurer.

(4) The provisions of ORS 744.062 governing application for amendment of a license apply to the indorsement of the license of an agent for authority to act as a managing general agent, except that an examination is not required for the indorsement.

(5) The provisions of this section are subject to exemptions stated in ORS 744.301. [1991 c.495 §2; 2001 c.191 §39]

744.301 Exemptions from license requirement. The following persons are exempt from ORS 744.300:

(1) An employee of an insurer, when the employee is acting as a managing general agent for the insurer.

(2) A United States manager of the United States branch of an alien insurer.

(3) An underwriting manager who, pursuant to contract, manages all the insurance operations of the insurer, is under common control with the insurer and is subject to ORS 732.517 to 732.592, and whose compensation is not based on the volume of premiums written.

(4) The attorney or attorney-in-fact authorized by and acting for the subscribers of a reciprocal insurer or interinsurance exchange under powers of attorney. [1991 c.495 §3; 1993 c.447 §63a]

744.303 Certificate of errors and omissions insurance. (1) A managing general agent must maintain with the Director of the Department of Consumer and Business Services at all times a current certificate of errors and omissions insurance, in an amount established by the director by rule, from an insurer authorized to transact insurance in this state or from any other insurer acceptable to the director according to standards established by rule. The insurance must cover errors and omissions of and any violation of fiduciary responsibility by the managing general agent or its employees, or both.

744.305 [Formerly 750.010; repealed by 1987 c.774 §154]

744.306 Contract between insurer and managing general agent. A person acting as a managing general agent shall not place business with an insurer unless a written contract is in force between the parties. The following requirements apply to such a contract:

(c) That with respect to all funds collected by a managing general agent for the account of an insurer, the managing general agent must comply with ORS 744.083, except that the managing general agent may retain in the account an amount not exceeding three months’ estimated claims payments and allocated loss adjustment expenses.

(d) That the managing general agent shall maintain separate records of business written by the managing general agent. Further, that the managing general agent shall allow the insurer access to all accounts and records related to its business, shall keep all such accounts and records in a form usable by the insurer and shall allow the insurer to copy all such accounts and records.

(e) That the managing general agent shall not assign the contract either in whole or part.

(f) Appropriate underwriting guidelines, including:

(A) The maximum annual premium volume;

(B) The basis of the rates to be charged;

(C) The types of risks that may be written;

(D) Maximum limits of liability;

(E) Applicable exclusions;

(F) Territorial limitations;

(G) Policy cancellation provisions; and

(H) The maximum policy period.

(g) That the insurer may cancel or nonrenew any policy of insurance, subject to applicable statutes and rules governing cancellation and non-renewal of insurance policies.

(h) Provisions addressing the timely transmission of the data, when electronic claims files exist.

(i) That if the contract provides for a sharing of interim profits of the managing general agent and if the managing general agent has the authority to determine the amount of the interim profits by establishing loss reserves or controlling claim payments, or in any other manner, interim profits shall not be paid to the managing general agent until one year after they are earned for property or surety insurance business and five years after they are earned on casualty business and not until the profits have been verified pursuant to ORS 744.313.

(j) That a managing general agent shall not do any of the following:

(A) Bind reinsurance or retrocessions on behalf of the insurer, except that the managing general agent may bind facultative reinsurance contracts pursuant to obligatory facultative agreements if the contract with the insurer contains reinsurance underwriting guidelines that include, for both reinsurance assumed and ceded, a list of reinsurers with which the automatic agreements are in effect, the coverage and amounts or percentages that may be reinsured and commission schedules.

(B) Commit the insurer to participate in insurance or reinsurance syndicates.

(C) Appoint any agent without assuring that the agent is licensed in this state to transact the type of insurance for which the agent is appointed.

(D) Collect any payment from a reinsurer or commit the insurer to any claim settlement with a reinsurer without prior approval of the insurer. The contract must also provide that if prior approval is given, the managing general agent must forward a report to the insurer promptly.

(E) Appoint a submanaging general agent.

(k) Provisions establishing which disputes, if any, arising under the contract shall be decided by arbitration, mediation or other means of dispute resolution.

(L) If the managing general agent will calculate the loss reserves or a portion thereof, provisions:

(A) That the insurer is ultimately responsible for reporting the loss reserves; and

(B) That the insurer shall annually obtain the opinion of an actuary attesting to the adequacy of loss reserves calculated for losses incurred and outstanding on business produced by the managing general agent, in addition to any other required loss reserve actuarial opinion, as provided in ORS 744.313.

(4) In addition to the requirements of subsection (3) of this section, if the contract permits the managing general agent to settle claims on behalf of the insurer, the contract must also include at least the following provisions:

(a) The time requirements within which the managing general agent must report claims to the insurer.

(b) A requirement that the managing general agent must send a copy of the claim file or report of claim to the insurer at its request or as soon as it becomes known to the managing general agent that the claim:

(A) Has the potential of exceeding an amount determined by the Director of the Department of Consumer and Business Services or the limit set by the insurer, whichever is less;

(B) Involves a coverage dispute;

(C) May exceed the claim settlement authority of the managing general agent; or

(D) Is of a serious nature as predetermined by the insurer by written guidelines.

(c) A provision establishing the settlement authority granted the managing general agent for claims in general and specific guidelines for handling claims that exceed the amount established by the director or the insurer, whichever is less.

(d) A provision that all claim files are the joint property of the insurer and managing general agent, except upon an order of liquidation of the insurer, and that in the event of such an order:

(A) The files become the sole property of the insurer or its estate; and

(B) The managing general agent shall have reasonable access to and the right to copy the files on a timely basis.

(e) A provision that the insurer may terminate for cause any settlement authority granted to the managing general agent upon written notice by the insurer to the managing general agent or upon the termination of the contract, and that the insurer may suspend the settlement authority during the pendency of any dispute regarding the cause for termination.

(5) The contract must provide that the insurer may not allow the managing general agent to pay or commit the insurer to pay a claim in excess of a specified amount, net of reinsurance, without approval by the insurer. The amount shall not exceed the amount established in ORS 744.308. [1991 c.495 §5]

744.308 Limitations on authority of insurer and managing general agent. (1) An insurer shall not allow a managing general agent, without prior approval of the insurer, to pay or commit the insurer to pay a claim over the amount, net of reinsurance, specified in the contract under ORS 744.306. The amount established in the contract shall not exceed one percent of the insurer’s policyholder surplus as of December 31 of the last completed calendar year.

(2) Neither an insurer nor a managing general agent may allow a subagent of the managing general agent to serve on the board of directors of the insurer.

(3) An insurer and a managing general agent may not jointly employ any individual. [1991 c.495 §6]

744.310 [Repealed by 1967 c.359 §704]

744.311 Books, bank accounts and records. A managing general agent shall maintain all of its books, bank accounts and records in a form usable by the Director of the Department of Consumer and Business Services. The managing general agent shall allow the director access to all of its books, bank accounts and records. [1991 c.495 §7]

744.313 Financial examination; loss reserves; notification of appointment and termination; acts of managing general agent attributed to insurer. (1) An insurer shall have on file an independently performed financial examination of each managing general agent with which it has done business, in a form prescribed by the Director of the Department of Consumer and Business Services.

(6) An insurer shall review its books and records each calendar quarter to determine if any agent who previously had not produced and underwritten sufficient gross direct written premium to meet the description of a managing general agent in ORS 744.300 has become a managing general agent subject to ORS 744.300 to 744.316. When an insurer determines that an agent has become a managing general agent:

(a) The insurer shall promptly notify the agent and the director of its determination.

(b) The insurer and agent must fully comply with ORS 744.300 to 744.316 not later than the 60th day after the date of notification under paragraph (a) of this subsection.

(7) An insurer shall not appoint to its board of directors an officer, director, employee, subproducer or controlling shareholder of any of its managing general agents. This subsection does not apply to relationships governed by ORS 732.517 to 732.592.

(8) The acts of a managing general agent shall be regarded as the acts of the insurer on whose behalf the managing general agent is acting. The director may examine a managing general agent as if it were the insurer. [1991 c.495 §§8,9]

744.314 Rules. The Director of the Department of Consumer and Business Services may adopt rules to carry out ORS 744.300 to 744.316. [1991 c.495 §10]

744.315 [Formerly 750.020; 1981 c.455 §1; repealed by 1987 c.774 §154]

744.316 Authority of director if managing general agent violates provisions of ORS 744.300 to 744.316. If the Director of the Department of Consumer and Business Services finds that a managing general agent has violated any provision of ORS 744.300 to 744.316, the director may order the managing general agent to reimburse the insurer or the rehabilitator or liquidator of the insurer for losses incurred by the insurer because of the violation. The director may take action under this section in addition to or instead of any other action the director may take under the Insurance Code. [1993 c.447 §63c]

LIFE SETTLEMENT CONTRACTS

744.319 Definitions. As used in ORS 744.319 to 744.358:

(1) "Licensee" means either a life settlement provider or life settlement broker.

(2) "Life settlement broker" means a person who, for another person and for a fee, commission or other consideration:

(3) "Life settlement contract" means an agreement between a life settlement provider and the holder of a group or individual life insurance policy insuring the life of a person with a terminal illness or condition, or between a life settlement provider and the certificate holder of such a policy, in which:

(4) "Life settlement provider" means a person who solicits, enters or negotiates life settlement contracts or offers to enter or negotiate life settlement contracts. [1995 c.342 §2]

744.320 [Amended by 1959 c.369 §5; repealed by 1967 c.359 §704]

744.321 Life settlement providers. (1) A person shall not act as a life settlement provider unless the person holds a license of life settlement provider issued by the Director of the Department of Consumer and Business Services.

(2) The term "life settlement provider" does not apply to any of the following:

(a) Any bank, savings bank, savings and loan association, credit union or other licensed lending institution that takes an assignment of a life insurance policy as collateral for a loan. The exemption in this paragraph applies only with respect to such an assignment.

(b) An insurer issuing a life insurance policy providing accelerated benefits pursuant to ORS 743.154 or pursuant to the laws of the state to which the policy was subject when issued. The exemption in this paragraph applies only with respect to the relationship between the insurer and insured under such a policy.

(c) Any individual who enters into not more than one agreement in a calendar year for the transfer of life insurance policies for any value less than the expected death benefit.

(3) A life settlement provider may use the term "viatical settlement provider" to describe the business transacted under the license and may use the term "viatical settlement contract" instead of "life settlement contract." [1995 c.342 §3]

744.323 Life settlement brokers. (1) A person shall not act as a life settlement broker unless the person holds a license of life settlement broker issued by the Director of the Department of Consumer and Business Services.

(2) The term "life settlement broker" does not apply to an attorney, accountant or financial planner retained to represent the policyholder or certificate holder unless compensation paid to the attorney, accountant or financial planner is paid by the life settlement provider.

(3) A life settlement broker may use the term "viatical settlement broker" to describe the business transacted under the license and may use the term "viatical settlement contract" instead of "life settlement contract." [1995 c.342 §4]

744.325 [1967 c.359 §550; repealed by 1987 c.774 §154]

744.326 License application; fee. (1) In order to obtain a license to transact business as a life settlement provider or as a life settlement broker, an applicant shall apply for the license on a form prescribed by the Director of the Department of Consumer and Business Services, with payment of any fee required for the application.

(2) The director may request biographical, organizational, locational, financial, employment and any other information on the application form that the director determines to be relevant to the evaluation of applications and to the granting of the license. The director may also require a statement of the business plan or plan of operation of the applicant. The director may also require an applicant for a life settlement provider license to file with the application a copy of the life settlement contract that the applicant intends to use in business under the license.

(3) If an applicant is a corporation, the corporation must be incorporated under the laws of this state or must be a foreign corporation authorized to transact business in this state. [1995 c.342 §5]

744.328 Issuance of license. (1) If the Director of the Department of Consumer and Business Services determines that an applicant has satisfied all requirements for the license for which application is made, the director shall issue the license to the applicant. The director may issue a license if the director determines that the applicant, as required to be set forth in the application for the license:

(a) Has not engaged in conduct that would authorize the director to refuse to issue a license under ORS 744.338; and

(b) Is financially responsible and has a good business reputation.

(2) The director may refuse to issue a license in the name of any firm, partnership or corporation if the director is not satisfied that any officer, employee, stockholder or partner thereof who may materially influence the conduct of the applicant meets the standards of this section.

(3) The director may issue a license to a nonresident applicant only if the nonresident applicant files with the director in writing an appointment of the director to be the attorney of the applicant upon whom all legal process in any action or proceeding against the applicant may be served. In the appointment, the applicant shall agree that any lawful process against the applicant that is served upon the director shall be of the same legal force and validity as if served upon the applicant, and that the authority shall continue in force so long as any liability remains outstanding in this state. An appointment under this subsection becomes effective on the date that the director issues the license to the applicant.

(4) If the director denies an application, the director shall so inform the applicant, stating the grounds for the denial. [1995 c.342 §6]

744.330 [Repealed by 1967 c.359 §704]

744.331 Expiration of license; rules for renewal. (1) A license issued under ORS 744.328 expires on its expiration date unless it is renewed on or before its expiration date.

(2) Unless the Director of the Department of Consumer and Business Services designates another date, a license expires on the last day of the month in which the second anniversary of the initial issuance date of the license occurs, and on the second anniversary following each renewal.

(3) The director by rule may establish requirements for renewing licenses. [1995 c.342 §7]

744.333 Individual acting as provider under license of firm or corporation. An individual may act as a life settlement provider under the authority of the license of a firm or corporate life settlement provider, whether or not the individual holds a license as a life settlement provider, if:

(1) The individual is a member or employee of the firm or is an employee, officer or director of the corporation; and

(2) The individual is designated by the firm or corporation on its license application or on an amendatory or supplementary form thereto as authorized to act as a life settlement provider under the authority of the license. [1995 c.342 §8]

744.335 [1967 c.359 §551; 1981 c.455 §2; repealed by 1987 c.774 §154]

744.336 Notification by licensee of material change affecting qualification for license. A licensee shall immediately notify the Director of the Department of Consumer and Business Services of any material change in ownership or control or in any other matter affecting the qualification of the licensee for the license in this state. [1995 c.342 §9]

744.338 Suspension, revocation, refusal to issue or renew license. (1) The Director of the Department of Consumer and Business Services may suspend, revoke, refuse to issue or refuse to renew a license of a licensee if the director finds one or more of the following with respect to the licensee or applicant for a license:

(a) Dishonesty, fraud or gross negligence in the conduct of business as a licensee, or the licensee or applicant is otherwise shown to be untrustworthy or incompetent to act as a licensee.

(b) The life settlement provider demonstrates a pattern of unreasonable payments to policyholders or certificate holders.

(c) Falsification by the applicant or licensee of an application for the license or renewal thereof, or misrepresentation or engagement in any other dishonest act in relation to the application.

(d) Conduct resulting in a conviction of a felony under the laws of any state or of the United States, to the extent that such conduct may be considered under ORS 670.280.

(e) Conviction of any crime, an essential element of which is dishonesty or fraud, under the laws of any state or of the United States.

(f) Refusal to renew or cancellation, revocation or suspension of authority to transact insurance or business as a life settlement provider, life settlement broker or similar entity in another state.

(g) Failure to pay a civil penalty imposed by final order of the director or to carry out terms of probation set by the director.

(h) Refusal by a licensee to be examined or to produce accounts, records or files for examination, refusal by any officers to give information with respect to the affairs of the licensee or refusal to perform any other legal obligation as to the examination when required by the director.

(i) Affiliation with or under the same general management or interlocking directorate or ownership as another life settlement provider or life settlement broker or an insurer, any of which unlawfully transacts business in this state.

(j) Failure at any time to meet any qualification for which issuance of the license could have been refused had the failure then existed and been known to the director.

(k) Violation of any rule or order of the director or any provision of the Insurance Code.

(2) The director may suspend or refuse to renew a license immediately and without hearing if the director determines that one or both of the following circumstances exist:

(a) The licensee is insolvent.

(b) The financial condition or business practices of the licensee otherwise pose an imminent threat to the public health, safety or welfare of the residents of this state.

(3) A life settlement provider or life settlement broker holding a license that has not been renewed or has been revoked shall surrender the license to the director at the director’s request.

(4) The director may take any other administrative action authorized under the Insurance Code in addition to or in lieu of the actions authorized under this section. [1995 c.342 §10]

744.340 [Repealed by 1967 c.359 §704]

744.341 Terms of contract. (1) A life settlement contract must be in writing. A life settlement provider shall establish in the contract the terms under which the life settlement provider will pay compensation or anything of value in return for the policyholder’s or certificate holder’s assignment, transfer, sale, devise or bequest of the death benefit or ownership of the insurance policy or certificate to the life settlement provider.

(2) A life settlement provider shall not use a life settlement contract in this state unless the life settlement provider has filed the contract form with the Director of the Department of Consumer and Business Services and the director has approved the contract form. The director shall disapprove a life settlement contract form if, in the director’s opinion, the contract or any provision of the contract is unreasonable, contrary to the interests of the public, or otherwise misleading or unfair to the policyholder or certificate holder.

(3) Each life settlement contract entered into in this state must contain a provision enabling the policyholder or certificate holder to rescind the contract not later than the 30th day after the date on which the contract is executed by all parties or not later than the 15th day after the policyholder or certificate holder receives the life settlement proceeds, whichever is the lesser period. In order to rescind such a contract, a policyholder or certificate holder who has received the proceeds must return them to the life settlement provider. [1995 c.342 §11]

744.343 Annual report by provider. Each life settlement provider shall file a report for the preceding calendar year with the Director of the Department of Consumer and Business Services on or before March 1 of each year, or within such extension of time therefor as the director may grant. The report shall be in the form and contain such information as the director prescribes and shall be verified as follows:

(1) If the life settlement provider is a corporation, by at least two principal officers of the life settlement provider.

(2) If the life settlement provider is a partnership, by two partners.

(3) If the life settlement provider is neither a corporation nor a partnership, by its president and secretary. [1995 c.342 §12]

744.345 [Formerly 750.040; repealed by 1987 c.774 §154]

744.346 Examination of business and practices of licensee or applicant; records. (1) The Director of the Department of Consumer and Business Services may examine the business and practices of any licensee or applicant for a license when the director determines an examination to be necessary. The director may order a licensee or applicant to produce any records, books, files or other information reasonably necessary to ascertain whether or not the licensee or applicant is acting or has acted in violation of the law or otherwise contrary to the interests of the public. The expenses incurred in conducting any examination shall be paid by the licensee or applicant.

(2) A life settlement provider shall maintain records of all transactions of life settlement contracts of the life settlement provider and must make the records available to the director for inspection during reasonable business hours. The records must be maintained for a period of not later than five years from the date of their creation.

(3) The director at any time may require a licensee to fully disclose the identity of all stockholders, partners, officers and employees.

(4) Names of, and individual identification data for, all policyholders and certificate holders who have entered life settlement contracts with life settlement providers shall be confidential as provided in ORS 705.137. [1995 c.342 §13; 2001 c.377 §15]

744.348 Disclosure of information to policyholder. A life settlement provider shall disclose the information specified in this section to the policyholder or certificate holder entering the life settlement contract, not later than the date on which the life settlement contract is signed by all parties. The disclosure must be in the manner prescribed by the Director of the Department of Consumer and Business Services. The information must include the following:

(1) Possible alternatives to life settlement contracts for persons with terminal illnesses or conditions, including but not limited to accelerated benefits offered by the issuer of the life insurance policy.

(2) The fact that some or all of the proceeds of the life settlement may be taxable, and that assistance should be sought from a personal tax advisor.

(3) The fact that the life settlement could be subject to the claims of creditors.

(4) The fact that receipt of a life settlement may adversely affect the recipient’s eligibility for Medicaid or other government benefits or entitlements, and that advice should be obtained from the appropriate agencies.

(5) The right of a policyholder or certificate holder to rescind a life settlement contract as provided in ORS 744.341. The disclosure shall state the deadlines for rescission and return of proceeds received.

(6) The date by which the funds will be available to the policyholder or certificate holder and the source of the funds. [1995 c.342 §14]

744.350 [Repealed by 1967 c.359 §704]

744.351 Conditions precedent to entering into life settlement contract. (1) Before a life settlement provider enters into a life settlement contract with a policyholder or certificate holder who has a terminal illness or condition, the life settlement provider shall first obtain both of the following:

(a) A written statement from an attending physician that the policyholder or certificate holder is of sound mind and under no constraint or undue influence.

(b) A witnessed document in which the policyholder or certificate holder consents to the life settlement contract, acknowledges the illness or condition is terminal, represents that the policyholder or certificate holder has a full and complete understanding of the life settlement contract, that the policyholder or certificate holder has a full and complete understanding of the benefits of the life insurance policy, releases the medical records of the policyholder or certificate holder relating to the terminal illness or condition and acknowledges that the policyholder or certificate holder has entered into the life settlement contract freely and voluntarily.

(2) A life settlement provider may enter a life settlement contract only after the individual whose life would be the subject of the life settlement contract is determined to have a terminal illness or condition, as follows:

(a) If the individual is the policyholder or certificate holder, an attending physician of the policyholder or certificate holder must make the determination.

(b) If the individual is a person other than the policyholder or certificate holder, an attending physician of the individual or of the policyholder or certificate holder must make the determination.

(3) For the purposes of this section, an attending physician is a medical doctor, doctor of osteopathy or naturopathic physician licensed in this state, who is primarily responsible for the treatment or a portion of treatment of the individual whose life would be the subject of the life settlement contract. [1995 c.342 §15]

744.353 Prohibitions on finder’s fee, solicitations, discrimination. (1) A licensee shall not pay or offer to pay a finder’s fee, commission or other compensation to a person described in this subsection, in connection with a policy insuring the life of an individual with a terminal illness or condition. The prohibition under this subsection applies with respect to payments or offers of payment to:

(a) The physician, attorney or accountant of the policyholder, of the certificate holder or of the insured individual when the individual is other than the policyholder or certificate holder.

(b) Any person other than a physician, attorney or accountant described in paragraph (a) of this subsection, who provides medical, legal or financial planning services to the policyholder, to the certificate holder or to the insured individual when the individual is other than the policyholder or certificate holder.

(c) Any person other than one described in paragraph (a) or (b) of this subsection who acts as an agent of the policyholder, certificate holder or insured individual.

(2) A licensee shall not solicit an investor who could influence the treatment of the illness or condition of the individual whose life would be the subject of a life settlement contract.

(3) All information solicited or obtained from a policyholder or certificate holder by a licensee shall be subject to ORS 746.600 to 746.690. For purposes of this subsection, a licensee shall be considered an insurance-support organization within the meaning of ORS 746.600.

(4) A licensee shall not discriminate in the making of a life settlement contract on the basis of race, age, sex, national origin, creed, religion, occupation, marital or family status, sexual orientation, or discriminate between persons who have dependents and persons who do not have dependents. [1995 c.342 §16]

744.355 [Formerly 750.050; repealed by 1987 c.774 §154]

744.356 Payment to escrow or trust account; lump sum payment. (1) Immediately upon receipt of documents from the policyholder or certificate holder effecting the transfer of the insurance policy or certificate, the life settlement provider shall pay the proceeds of the settlement to an escrow or trust account managed by a trustee or escrow agent in a bank approved by the Director of the Department of Consumer and Business Services, pending acknowledgment of the transfer by the issuer of the life insurance policy. The trustee or escrow agent shall be required to transfer the proceeds due to the policyholder or certificate holder immediately upon receipt of acknowledgment of the transfer from the insurer.

(2) A life settlement provider shall make payment of the proceeds of a life settlement contract in a lump sum, except as provided in this subsection. A life settlement provider shall not retain any portion of the proceeds. A life settlement provider may make installment payments only if the life settlement provider has purchased an annuity issued by an authorized insurer or a similar financial instrument issued by a financial institution authorized to engage in the business of a financial institution in this state.

(3) Failure by the life settlement provider to tender the life settlement by the date disclosed to the policyholder or certificate holder renders the contract void. [1995 c.342 §17]

744.358 Rules; standards; bond. The Director of the Department of Consumer and Business Services may adopt rules for the purpose of carrying out ORS 744.319 to 744.358. In addition:

(1) The director may establish standards for evaluating reasonableness of payments under life settlement contracts. The authority includes but is not limited to regulation of discount rates used to determine the amount paid in exchange for assignment, transfer, sale, devise or bequest of a benefit under a life insurance policy. For the purpose of the standards, the director shall consider payments made in regional and national life settlement markets, to the extent such information is available, as well as model standards developed by the National Association of Insurance Commissioners.

(2) The director may require a bond or an errors and omissions insurance policy of either or both kinds of licensees.

(3) The director may establish trade practice standards by rule for the purpose of regulating advertising and solicitation of life settlement contracts. [1995 c.342 §18]

744.360 [Repealed by 1967 c.359 §704]

744.365 [1967 c.359 §554; repealed by 1987 c.774 §154]

744.370 [Repealed by 1967 c.359 §704]

744.375 [Formerly 750.060; repealed by 1987 c.774 §154]

744.380 [Repealed by 1967 c.359 §704]

744.385 [Formerly 750.100; repealed by 1987 c.774 §154]

744.390 [Repealed by 1967 c.359 §704]

744.395 [Repealed by 1967 c.359 §704]

744.396 [Formerly 750.080; repealed by 1987 c.774 §154]

744.400 [Repealed by 1967 c.359 §704]

744.405 [Formerly 750.090; 1979 c.870 §7; repealed by 1987 c.774 §154]

744.410 [Amended by 1963 c.463 §1; repealed by 1967 c.359 §704]

744.420 [Amended by 1953 c.322 §2; 1963 c.463 §2; repealed by 1967 c.359 §704]

744.430 [Amended by 1955 c.226 §2; 1963 c.463 §3; 1967 c.359 §503; renumbered 743.672]

744.440 [Amended by 1967 c.359 §504; renumbered 743.675]

744.450 [Amended by 1967 c.359 §505; renumbered 743.678]

744.460 [Amended by 1967 c.359 §506; renumbered 743.681]

744.470 [Repealed by 1967 c.359 §704]

744.480 [Repealed by 1967 c.359 §704]

744.490 [Repealed by 1967 c.359 §704]

744.500 [Repealed by 1967 c.359 §704]

744.505 Adjuster license required. (1) Except as provided in ORS 744.515, a person shall not act or attempt to act as an adjuster of losses claimed under insurance policies, whether acting for the insurer or the insured, unless the person holds a valid license issued by the Director of the Department of Consumer and Business Services that authorizes the person to act as an adjuster. A license under this section authorizes an adjuster to adjust losses for or against authorized insurers or insurers with which policies were placed under a surplus line insurance license as provided in ORS 735.400 to 735.495.

(2) A license under this section does not authorize a person to act as an adjuster for any person other than the insurer or insured. [Formerly 736.485; 1983 c.76 §10; 1987 c.774 §139; 1989 c.413 §14; 1989 c.701 §43; 1991 c.810 §12]

744.510 [Repealed by 1967 c.359 §704]

744.515 Exemptions from adjuster licensing requirement. (1) A licensed resident agent or salaried employee or officer of an authorized insurer may adjust and settle losses for the insurer that the agent, employee or officer represents, without obtaining an adjuster’s license.

(3) A person holding a temporary permit under ORS 744.555 may perform acts authorized under ORS 744.555 without obtaining an adjuster’s license.

(4) Any average adjuster or adjuster of maritime losses may adjust maritime losses without obtaining an adjuster’s license.

(5) A person may perform or provide repair or replacement service under home protection insurance without obtaining an adjuster’s license. [1967 c.359 §560; 1971 c.231 §33; 1981 c.247 §19; 1983 c.76 §11; 1989 c.701 §44]

744.520 [Repealed by 1967 c.359 §704]

744.525 Adjuster qualifications. An applicant for a license as a resident adjuster shall apply for the license as provided in ORS 744.001 and must meet the following requirements:

(1) If the applicant is an individual, the applicant must establish a residence or place of transacting insurance business in this state prior to filing an application. If the applicant is a firm or corporation, the applicant must establish an office in this state that employs an individual licensed under ORS 744.002 as an adjuster.

(2) If the applicant is an individual, the applicant must pass any examination required by ORS 744.535.

(3) The applicant must satisfy all other requirements established by the Director of the Department of Consumer and Business Services by rule. [1967 c.359 §561; 1971 c.231 §34; 1973 c.827 §81; 1983 c.76 §12; 1989 c.701 §45]

744.528 Nonresident adjuster license. (1) A person who resides in another state or a province of Canada and is licensed in that state or province as an adjuster may be licensed to act as a nonresident adjuster in this state as provided in this section if the state or province in which the person resides gives the same privilege to a resident adjuster of this state.

(a) Apply for the license on forms designed and furnished by the Director of the Department of Consumer and Business Services as provided in ORS 744.001.

(b) If the applicant is an individual, pass an examination required by ORS 744.535. [1989 c.701 §46; 1991 c.810 §13]

744.530 [1957 c.247 §1; repealed by 1967 c.359 §704]

744.531 Classes of insurance for adjusters. When the director issues a license authorizing a person to act as an adjuster, the director shall indorse on the license the class or classes of insurance described in this section with respect to which the person is authorized to adjust losses. The classes of insurance are as follows:

(2) Health insurance, whether provided by an insurer or a health care service contractor as defined in ORS 750.005.

(3) Any class of insurance designated by the director by rule. [1989 c.701 §47]

Note: 744.531 was enacted into law by the Legislative Assembly but was not added to or made a part of ORS chapter 744 or any series therein by legislative action. See Preface to Oregon Revised Statutes for further explanation.

744.535 Adjuster licensing examination. (1) The Director of the Department of Consumer and Business Services shall give an examination to each individual applicant for a license as an adjuster. The examination must test the qualifications and competence of the applicant and the knowledge of the applicant with respect to the classes of insurance that may be dealt with under the license and with respect to the duties and responsibilities of an adjuster under the laws of this state.

744.538 Change of circumstance of nonresident adjuster. (1) A nonresident adjuster shall not act as an adjuster in this state when the adjuster no longer holds a valid license as an adjuster in the state or province in which the adjuster resides. If the license of the adjuster in the state in which the adjuster resides is reinstated, and if the nonresident adjuster’s license has not expired, the adjuster may apply to the Director of the Department of Consumer and Business Services for reinstatement of the nonresident license.

744.540 [1957 c.247 §2; repealed by 1967 c.359 §704]

744.541 Adjustment of claim under policy issued by unauthorized insurer. An adjuster may adjust a loss claimed under an insurance policy issued by an unauthorized insurer other than a surplus line insurer. The adjuster shall notify the Director of the Department of Consumer and Business Services thereof not later than the 20th day after adjusting the loss. [1989 c.701 §50]

744.545 [1967 c.359 §563; 1983 c.76 §13; 1989 c.413 §16; repealed by 1989 c.701 §81]

744.550 [1957 c.247 §3; repealed by 1967 c.359 §704]

744.555 Temporary adjuster permit. (1) To facilitate the settlement of claims under insurance policies when there is widespread property loss in this state arising out of a catastrophe, the Director of the Department of Consumer and Business Services may issue a temporary permit to any person authorized in another state to adjust losses claimed under insurance policies to act as an adjuster in the catastrophe area for or against an authorized insurer. A temporary permit issued pursuant to this section shall be effective for such time as the director determines necessary and shall be in lieu of the license and fee requirements otherwise applicable.

(3) Such a permit may also be issued in respect to any adjuster who is licensed or permitted to act as such in the state of domicile of the adjuster and who is sent into this state on behalf of an authorized insurer or insured for the purpose of investigating or making adjustment of a particular loss under policies of insurance. [Formerly 736.490; 1989 c.701 §51]

744.560 [1957 c.247 §4; repealed by 1967 c.359 §704]

744.565 [1957 c.247 §5; repealed by 1967 c.359 §704]

744.566 [1967 c.359 §565; repealed by 1969 c.336 §21]

744.570 [1957 c.247 §6; repealed by 1967 c.359 §704]

744.575 Adjusting claims involving credit life or credit health insurance. No plan or arrangement shall be used with respect to credit life or credit health insurance whereby any person other than the insurer or its designated claim representative shall be authorized to settle or adjust claims. The creditor shall not be designated as claim representative for the insurer in adjusting claims, except that a group policyholder may, by arrangement with the group insurer, draw drafts or checks in payment of claims due to the group policyholder subject to audit and review by the insurer. [Formerly 741.455; 1989 c.701 §52]

744.580 [1957 c.247 §7; repealed by 1967 c.359 §704]

744.590 [1957 c.247 §8; repealed by 1967 c.359 §704]

744.600 [1957 c.247 §9; repealed by 1967 c.359 §704]

744.605 Insurance consultant’s license required. (1) A person shall not act as an insurance consultant unless the person holds a valid license issued by the Director of the Department of Consumer and Business Services that authorizes the person to act as an insurance consultant. For purposes of this section, a person acts as an insurance consultant if:

744.609 Exemptions. The following persons are not insurance consultants for the purposes of this chapter, and the prohibition in ORS 744.605 does not apply to them:

(1) Any attorney-at-law rendering services in the performance of duties of an attorney-at-law.

(2) Any certified public accountant or public accountant rendering services in the performance of the duties of a certified public accountant or public accountant, as authorized by law.

(3) Any person who, while conducting an educational seminar, performs any of the activities described in ORS 744.605 (1)(b).

(4) Any financial institution, as defined in ORS 706.008, or consumer finance licensee under ORS chapter 725.

(5) Any actuary who is a member of an organization determined by the Director of the Department of Consumer and Business Services as establishing standards for the actuarial profession.

(6) A person who provides or offers or purports to provide any of the services described in ORS 744.605 only to an agent or an authorized insurer. [1985 c.697 §3; 1989 c.701 §54; 1991 c.810 §16; 1997 c.419 §2; 1999 c.59 §228]

744.610 [1957 c.247 §10; repealed by 1967 c.359 §704]

744.615 [1985 c.697 §4; repealed by 1989 c.701 §81]

744.619 Qualifications for resident insurance consultant’s license. An applicant for a license as a resident insurance consultant shall apply for the license as provided in ORS 744.001 and must meet the following requirements:

(1) The applicant must provide satisfactory evidence to the Director of the Department of Consumer and Business Services that the insurance required under ORS 744.635 has been procured and is in effect.

(2) The applicant, if an individual, must establish a residence or place of transacting insurance business in this state prior to filing an application. If the application is a firm or corporation, the applicant must establish an office in this state that is managed by an individual licensed as an insurance consultant.

(3) The applicant, if an individual, must have had at least five years’ experience in the insurance business relating to the class or classes of insurance for which the applicant is applying to be an insurance consultant or have equivalent educational qualifications as prescribed by the director.

(4) The applicant, if an individual, must pass a written examination given by the director. The examination requirement does not apply to an applicant who is licensed as a resident agent to transact the class or classes of insurance for which the applicant is applying to be an insurance consultant.

(5) The applicant must satisfy any other requirements established by the director by rule. [1985 c.697 §5; 1989 c.701 §57; 1991 c.810 §17]

744.620 [1957 c.247 §11; repealed by 1967 c.359 §704]

744.621 Nonresident insurance consultant license. (1) A person who resides in another state or province of Canada and is licensed in that state or province as an insurance consultant or is registered under a regulatory program of the other state or province similar to the regulatory program for insurance consultants under this chapter, as determined by the Director of the Department of Consumer and Business Services, may be licensed to act as a nonresident insurance consultant in this state as provided in this section if the state or province in which the person resides gives the same privilege to a resident insurance consultant of this state.

(2) An applicant for a license to act as a nonresident insurance consultant shall apply for the license as provided in ORS 744.001 and must meet the following requirements:

(a) The applicant must provide satisfactory evidence to the director that the insurance required under ORS 744.635 has been procured and is in effect.

(b) If the applicant is an individual, the applicant must have had at least five years’ experience in the insurance business relating to the class or classes of insurance for which the applicant is applying to be an insurance consultant or have equivalent educational qualifications as prescribed by the director.

(c) If the applicant is an individual, the applicant must take and pass a written examination given by the director, unless the state or province in which the applicant resides licenses or registers insurance consultants of this state without examination. The examination requirement does not apply to an applicant who is licensed as a nonresident agent to transact the class or classes of insurance for which the applicant is applying to be an insurance consultant.

(d) The applicant must satisfy any other requirements established by the director by rule. [1989 c.701 §58; 1991 c.810 §18]

744.625 [1985 c.697 §6; 1987 c.774 §142; repealed by 1989 c.701 §81]

744.626 Classes of insurance for consultants. When the director issues a license authorizing a person to act as an insurance consultant, the director shall indorse on the license the class or classes of insurance described in this section with respect to which the person is authorized to act as an insurance consultant. The classes of insurance are as follows:

Note: 744.626 was enacted into law by the Legislative Assembly but was not added to or made a part of ORS chapter 744 or any series therein by legislative action. See Preface to Oregon Revised Statutes for further explanation.

744.629 [1985 c.697 §7; repealed by 1989 c.701 §81]

744.630 [1957 c.247 §12; repealed by 1967 c.359 §704]

744.631 Change of circumstance of nonresident insurance consultant. (1) A nonresident insurance consultant shall not act as an insurance consultant in this state when the insurance consultant no longer holds a valid license as an insurance consultant in the state or province in which the insurance consultant resides. If the license of the insurance consultant in the state in which the insurance consultant resides is reinstated and if the nonresident license has not expired, the insurance consultant may apply to the Director of the Department of Consumer and Business Services for reinstatement of the nonresident license.

744.635 Errors and omissions insurance. (1) An insurance consultant shall maintain with the Director of the Department of Consumer and Business Services a current certificate of errors and omissions insurance in an amount established by the director by rule from an insurer authorized to do business in this state or from any other insurer acceptable to the director according to standards established by rule.

744.639 [1985 c.697 §9; repealed by 1989 c.701 §81]

744.640 [1957 c.247 §13; repealed by 1967 c.359 §704]

744.645 [1985 c.697 §10; repealed by 1989 c.701 §81]

744.650 Disclosure by insurance consultants. (1) An insurance consultant shall furnish to each client and prospective client a written disclosure statement containing the following information:

744.655 Rebates prohibited. An insurance consultant may not give or receive or offer to give or receive a rebate of all or a part of any fee or other expenses charged for services or any earnings, profit, dividends or other benefit accruing to the insurance consultant from the services provided by the insurance consultant. [1985 c.697 §12; 1991 c.810 §23]

744.660 [1985 c.697 §13; repealed by 1989 c.701 §81]

744.665 Continuing education. The Director of the Department of Consumer and Business Services by rule may establish requirements for continuing education that each insurance consultant must satisfy as a condition for continuation of the license. [1985 c.697 §14]

744.700 Definitions for ORS 744.700 to 744.740. As used in ORS 744.700 to 744.740:

(1) "Affiliate" of, or person "affiliated" with, a specific person means any person who directly or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, a specified person.

(2) "Control" has the meaning given that term in ORS 732.548.

(3) "Insurer" includes a health care service contractor, a multiple employer welfare arrangement or any other person providing a plan of insurance subject to state insurance regulation. "Insurer" does not include a bona fide employee benefit plan established by an employer or an employee organization, or both, for which the insurance laws of this state are preempted pursuant to the Employee Retirement Income Security Act of 1974.

(4) "Underwrite" or "underwriting" includes the acceptance of employer or individual applications for coverage of individuals in accordance with the written rules of the insurer, the overall planning and coordinating of an insurance program and the ability to procure bonds and excess insurance. [1991 c.812 §2]

744.702 Third party administrator license; description of transacting business as third party administrator. (1) Subject to ORS 744.704, a person shall not transact business or purport or offer to transact business as a third party administrator in this state on and after January 1, 1992, unless the person holds a third party administrator license issued by the Director of the Department of Consumer and Business Services.

(2) For purposes of ORS 744.700 to 744.740, a person transacts or purports or offers to transact business as a third party administrator when the person directly or indirectly solicits or effects coverage of, underwrites, collects charges or premiums from, or adjusts or settles claims on, residents of this state or residents of another state from offices in this state, in connection with life insurance or health insurance coverage.

(3) Nothing in ORS 744.700 to 744.740 exempts a third party administrator from any other applicable licensing requirement when the third party administrator performs the functions of an agent, adjuster or insurance consultant. [1991 c.812 §3]

744.704 Exemptions from license requirement. (1) The following persons are exempt from the licensing requirement for third party administrators in ORS 744.702 and from all other provisions of ORS 744.700 to 744.740 applicable to third party administrators:

(a) A person licensed under ORS 744.002 as an adjuster, whose activities are limited to adjustment of claims and whose activities do not include the activities of a third party administrator.

(b) A person licensed as an agent as required by ORS 744.053 and authorized to transact life or health insurance in this state, whose activities are limited exclusively to the sale of insurance and whose activities do not include the activities of a third party administrator.

(c) An employer acting as a third party administrator on behalf of:

(A) Its employees;

(B) The employees of one or more subsidiary or affiliated corporations of the employer; or

(C) The employees of one or more persons with a dealership, franchise, distributorship or other similar arrangement with the employers.

(d) A union, or an affiliate thereof, acting as a third party administrator on behalf of its members.

(e) An insurer that is authorized to transact insurance in this state with respect to a policy issued and delivered in and pursuant to the laws of this state or another state.

(f) A creditor acting on behalf of its debtors with respect to insurance covering a debt between the creditor and its debtors.

(g) A trust and the trustees, agents and employees of the trust, when acting pursuant to the trust, if the trust is established in conformity with 29 U.S.C. 186.

(h) A trust exempt from taxation under section 501(a) of the Internal Revenue Code, its trustees and employees acting pursuant to the trust, or a voluntary employees beneficiary association described in section 501(c) of the Internal Revenue Code, its agents and employees and a custodian and the custodian’s agents and employees acting pursuant to a custodian account meeting the requirements of section 401(f) of the Internal Revenue Code.

(i) A financial institution that is subject to supervision or examination by federal or state financial institution regulatory authorities, or a mortgage lender, to the extent the financial institution or mortgage lender collects and remits premiums to licensed agents or authorized insurers in connection with loan payments.

(j) A company that issues credit cards and advances for and collects premiums or charges from its credit card holders who have authorized collection. The exemption under this paragraph applies only if the company does not adjust or settle claims.

(k) A person who adjusts or settles claims in the normal course of practice or employment as an attorney at law. The exemption under this subsection applies only if the person does not collect charges or premiums in connection with life insurance or health insurance coverage.

(L) A person who acts solely as an administrator of one or more bona fide employee benefit plans established by an employer or an employee organization, or both, for which the Insurance Code is preempted pursuant to the Employee Retirement Income Security Act of 1974. A person to whom this paragraph applies must comply with the requirements of ORS 744.714.

(m) The Oregon Medical Insurance Pool Board, established under ORS 735.600 to 735.650, and the administering insurer or insurers for the board, for services provided pursuant to ORS 735.600 to 735.650.

(n) An entity or association owned by or composed of like employers who administer partially or fully self-insured plans for employees of the employers or association members.

(o) A trust established by a cooperative body formed between cities, counties, districts or other political subdivisions of this state, or between any combination of such entities, and the trustees, agents and employees acting pursuant to the trust.

(p) Any person designated by the Director of the Department of Consumer and Business Services by rule.

(2) A third party administrator is not required to be licensed as a third party administrator in this state if the following conditions are met:

(a) The third party administrator has its principal place of business in another state;

(b) The third party administrator is not soliciting business as a third party administrator in this state; and

(c) In the case of any group policy or plan of insurance serviced by the third party administrator, the lesser of five percent or 100 certificate holders reside in this state. [1991 c.812 §4; 2001 c.191 §40]

744.706 Application for license. (1) In order to obtain a license to transact business as a third party administrator, an applicant shall apply for the license on a form prescribed by the Director of the Department of Consumer and Business Services, with payment of any fee required for the application.

(2) The director may request biographical, organizational, locational, financial, employment and any other information on the application form that the director determines to be relevant to the evaluation of applications and to the granting of the license, including satisfactory evidence that the insurance required under ORS 744.726 has been procured and is in effect. The director may also require a statement of the business plan of the applicant. [1991 c.812 §5]

744.708 Waiver of information requirement. Upon request from a third party administrator, the Director of the Department of Consumer and Business Services may waive requirements established pursuant to ORS 744.706 for information to be included in or with the application if the third party administrator has a valid license or other document of authority as a third party administrator issued in a state having requirements for third party administrators that the director determines to be sufficiently similar to the requirements established under ORS 744.706 so that the filing of the information would serve little or no regulatory purpose. [1991 c.812 §6]

744.710 Issuance or denial of license. (1) If the Director of the Department of Consumer and Business Services determines that an applicant has satisfied all requirements for a license as a third party administrator, the director shall issue the license to the applicant. The director shall not issue a license if the director determines that the third party administrator, or any individual responsible for the conduct of affairs of the third party administrator, as required to be set forth in the application for the license, is not competent, trustworthy, financially responsible or of good personal and business reputation, or has had a license or other document of authority to transact insurance as an insurer, agent or third party administrator denied or revoked for cause by any state.

(2) If the director denies an application, the director shall so inform the applicant, stating the grounds for the denial. [1991 c.812 §7]

744.712 Expiration and renewal of license. (1) A license of a third party administrator expires on its expiration date unless it is renewed on or before its expiration date.

744.714 Registration of persons exempt from licensure. A person who is exempt from the requirement of a license as a third party administrator under ORS 744.704 because the person acts solely as an administrator of one or more bona fide employee benefit plans established by an employer or an employee organization, or both, for which the Insurance Code is preempted pursuant to the Employee Retirement Income Security Act of 1974, shall register with the Director of the Department of Consumer and Business Services annually, verifying the status of the person as qualifying for the exemption. [1991 c.812 §9]

744.716 Notification of change in ownership or control. A third party administrator shall immediately notify the Director of the Department of Consumer and Business Services of any material change in ownership or control or in any other matter affecting the qualification of the third party administrator for a license as a third party administrator in this state. [1991 c.812 §10]

744.718 Suspension, revocation or refusal of issuance or renewal of license. (1) The Director of the Department of Consumer and Business Services shall suspend, revoke or refuse to renew a license of a third party administrator if the director finds that the third party administrator:

(a) Falsification by the applicant or licensee of an application for the license or renewal thereof, or engagement in any dishonest act in relation to the application;

(b) Dishonesty, fraud or gross negligence in the transaction of insurance or in the conduct of business as a third party administrator;

(c) Conduct resulting in a conviction of a felony under the laws of any state or of the United States, to the extent that such conduct may be considered under ORS 670.280;

(d) Conviction of any crime, an essential element of which is dishonesty or fraud, under the laws of any state or of the United States;

(e) Refusal to renew or cancellation, revocation or suspension of authority to transact insurance or business as a third party administrator or similar entity in another state;

(f) Failure to pay a civil penalty imposed by final order of the director or to carry out terms of probation set by the director;

(g) Refusal to be examined or to produce accounts, records or files for examination, refusal by any officers to give information with respect to the affairs of the third party administrator or refusal to perform any other legal obligation as to the examination when required by the director;

(h) Affiliation with or under the same general management or interlocking directorate or ownership as another administrator or insurer that unlawfully transacts business in this state;

(i) Failure at any time to meet any qualification for which issuance of the license could have been refused had the failure then existed and been known to the director; or

(j) Violation of any rule or order of the director or any provision of the Insurance Code.

(3) The director may suspend or refuse to renew a license immediately and without hearing if the director determines that one or more of the following circumstances exist:

(a) The third party administrator is insolvent;

(b) A proceeding for receivership, conservatorship or rehabilitation or other delinquency proceeding regarding the third party administrator has been commenced in any state; or

(c) The financial condition or business practices of the third party administrator otherwise pose an imminent threat to the public health, safety or welfare of the residents of this state.

(4) A third party administrator holding a license that has not been renewed or has been revoked shall surrender the license to the director at the director’s request.

(5) The director may take any other administrative action authorized under the Insurance Code in addition to or in lieu of the actions authorized under this section. [1991 c.812 §11]

744.720 Agreement between insurer and third party administrator. (1) A third party administrator licensed under ORS 744.702 may transact business as a third party administrator only pursuant to a written agreement between the third party administrator and the insurer. The agreement shall contain all provisions required by this section. However, any provision that does not apply to the functions to be performed by the third party administrator need not be included.

(2) An insurer and a third party administrator transacting business under an agreement required in subsection (1) of this section shall each retain the agreement with its records for the duration of the agreement and for five years following the date of its termination.

(3) An agreement required by this section shall include at least the following, in addition to any other requirements of ORS 744.700 to 744.740:

(a) A statement of duties that the third party administrator is expected to perform on behalf of the insurer and the lines, classes or types of insurance for which the third party administrator is to be authorized to administer;

(b) Provisions with respect to underwriting or other standards pertaining to the business underwritten by the insurer. The agreement shall also state the responsibilities of the third party administrator for determining the benefits, premium rates, underwriting criteria and claims payment procedures, and for securing any reinsurance, subject to the responsibilities of the insurer established in ORS 744.740;

(c) Provisions for the third party administrator to periodically render an accounting to the insurer detailing all transactions performed by the administrator pertaining to the business underwritten by the insurer;

(d) Provisions governing withdrawals from the fiduciary account required under ORS 744.730, and provisions otherwise relating to the fiduciary account, addressing at least the following matters:

(A) Remittance to an insurer entitled to the remittance;

(B) Deposit in an account maintained in the name of the insurer;

(C) Transfer to and deposit in a claims-paying account, with claims to be paid as provided in ORS 744.730;

(D) Payment to a group policyholder for remittance to the insurer entitled to the remittance;

(E) Payment to the third party administrator of its commission fees or charges; and

(F) Remittance of return premiums to the person entitled to the return premium; and

(e) Provisions establishing which disputes, if any, arising under the contract shall be decided by arbitration, mediation or other means of dispute resolution.

(4) Upon written notice, the insurer or third party administrator may terminate the written agreement for cause as provided in the agreement. The insurer may suspend the underwriting authority of the third party administrator during any dispute regarding the cause for termination of the written agreement. The insurer must fulfill any lawful obligations with respect to policies affected by the agreement, regardless of any dispute between the insurer and the third party administrator.

(5) A third party administrator shall make available for inspection to the Director of the Department of Consumer and Business Services copies of all contracts, and amendments thereto, with insurers or other persons using its services. [1991 c.812 §12]

744.722 Relationship of insurer and third party administrator regarding payments. (1) When an insurer uses the services of a third party administrator:

(a) Payment to the third party administrator of any premiums or charges for insurance by or on behalf of the insured party shall be considered to have been received by the insurer.

(b) Payment of return premiums or claim payments forwarded by the insurer to the third party administrator shall not be considered to have been paid to the insured party or claimant until the payment is received by the insured party or claimant.

(2) Nothing in this section limits any right of the insurer against the third party administrator resulting from failure by the third party administrator to make payments to the insurer, insured parties or claimants. [1991 c.812 §13]

744.724 Books and records. (1) Except as provided in subsection (4) of this section, a third party administrator shall maintain and make available to the insurer complete books and records of each transaction performed on behalf of the insurer. The books and records shall be maintained in accordance with prudent standards of insurance recordkeeping and must be maintained for a period of not less than five years from the date of their creation.

(2) The Director of the Department of Consumer and Business Services shall have access to the books and records maintained under subsection (1) of this section for the purpose of examination, audit and inspection. Any document, material or other information in the possession or control of the director that is furnished by a third party administrator, an insurer, an agent or an employee or an agent acting on behalf of the third party administrator, insurer or agent, or that is obtained by the director in an investigation, shall be confidential as provided in ORS 705.137.

(3) An insurer that has entered into an agreement with a third party administrator shall own the records generated by the third party administrator pertaining to the insurer. However, the third party administrator has the right to continuing access to the books and records to permit the third party administrator to fulfill all of its contractual obligations to insured parties, claimants and the insurer.

(4) If an insurer and third party administrator cancel their agreement, the third party administrator may agree in writing with the insurer to transfer all records to a successor third party administrator. If the agreement includes provisions to transfer the records, the third party administrator is no longer responsible for retaining the records for the five-year period. The successor third party administrator shall acknowledge in writing as part of its agreement with the insurer that it is responsible for retaining the records of the prior third party administrator as required in subsection (1) of this section. [1991 c.812 §14; 2001 c.377 §16]

744.726 Errors and omissions insurance. (1) A third party administrator must maintain with the Director of the Department of Consumer and Business Services at all times a current certificate of errors and omissions insurance, in an amount established by the director by rule, from an insurer authorized to transact insurance in this state or from any other insurer acceptable to the director according to standards established by rule. The insurance must cover errors and omissions of and any violation of fiduciary responsibility by the third party administrator or its employees, or both.

(2) If the director determines that insurance required under this section is not generally available at a reasonable cost, the director by rule may suspend the requirement of insurance, but must reimpose the requirement when the insurance becomes available. [1991 c.812 §15]

744.728 Advertising. A third party administrator may use only such advertising pertaining to the business underwritten by an insurer that the insurer has approved in advance of its use. [1991 c.812 §16]

744.730 Disposition of charges and premiums. (1) A third party administrator shall hold in a fiduciary capacity all insurance charges or premiums collected by the third party administrator on behalf of or for an insurer, and all return premiums received from the insurer. The third party administrator shall immediately remit all charges, premiums or return premiums to the person entitled to them or shall deposit them promptly in a fiduciary account established and maintained by the third party administrator in a federally or state insured financial institution. The fiduciary account may be used only for deposits authorized under this subsection.

(2) If the charges or premiums deposited in a fiduciary account have been collected on behalf of or for one or more insurers, a third party administrator shall keep records clearly recording the deposits in and withdrawals from the account on behalf of each insurer. The third party administrator shall keep copies of all such records and, upon request of an insurer, shall furnish the insurer with copies of the records pertaining to such deposits and withdrawals.

(3) A third party administrator shall not pay any claim by withdrawals from a fiduciary account in which premiums or charges are deposited.

(4) All claims by a third party administrator from funds collected on behalf of the insurer shall be paid only on drafts of and as authorized by the insurer.

(5) A third party administrator that is an agent licensed under this chapter need not comply with this section if the third party administrator is in compliance with ORS 744.083 with respect to the premiums, charges and return premiums referred to in this section. [1991 c.812 §17]

744.732 Contingent fee agreements. (1) A third party administrator shall not enter into any agreement or understanding with an insurer the effect of which is to make the amount of the third party administrator’s commissions, fees or charges contingent upon savings effected in the adjustment, settlement and payment of losses covered by the obligations of the insurer.

(2) This section does not prohibit:

(a) A third party administrator from receiving performance-based compensation for providing hospital or other auditing services; or

(b) A third party administrator from receiving compensation based on premiums or charges collected or on the number of claims processed.

(3) The third party administrator shall disclose to the insurer all charges, fees and commissions received from all sources in connection with the provision of administrative services for the insurer, including any fees or commissions paid by insurers providing reinsurance. [1991 c.812 §18]

744.734 Notice to insureds regarding third party administrator. (1) When an insurer uses the services of a third party administrator, the third party administrator shall provide to covered individuals a written notice approved by the insurer that advises them of the identity of and relationship among the third party administrator, the policyholder and the insurer.

(2) When a third party administrator collects funds, the reason for collection of each item must be identified to the insured party and each item must be shown separately from any premium. Additional charges may not be made for services to the extent the services have been paid for by the insurer. [1991 c.812 §19]

744.736 Delivery from insurer to insured. When the third party administrator receives policies, certificates, booklets, termination notices or other written communications from the insurer for delivery to insured parties or covered individuals, the third party administrator shall promptly make the delivery after receiving instructions from the insurer. [1991 c.812 §20]

744.738 Annual report. (1) Each third party administrator shall file an annual report for the preceding calendar year with the Director of the Department of Consumer and Business Services on or before March 1 of each year, or within such extension of time therefor as the director may grant. The report shall be in the form and contain such information as the director prescribes and shall be verified by at least two officers of the third party administrator if the third party administrator is a corporation, and by two partners if the third party administrator is a partnership.

744.740 Responsibility of insurer using third party administrator. (1) An insurer who uses the services of a third party administrator is responsible for determining the benefits, premium rates, underwriting criteria and claims payment procedures applicable to the coverage and for securing any reinsurance. The rules pertaining to such matters must be provided in writing by the insurer to the third party administrator.

(2) An insurer is solely responsible for providing competent administration of its programs.

(3) When a third party administrator administers benefits for more than 100 certificate holders on behalf of an insurer, the insurer shall conduct a review of the operations of the third party administrator at least annually. [1991 c.812 §22]

REINSURANCE INTERMEDIARIES

744.800 Qualifications for intermediary brokers and managers. (1) For purposes of this section:

(a) An intermediary broker is a person who solicits, negotiates or places reinsurance cessions or retrocessions on behalf of a ceding insurer without the authority or power to bind reinsurance on behalf of the insurer.

(b) An intermediary manager is a person who has authority to bind a reinsurer or who manages all or part of the assumed reinsurance business of a reinsurer, including the management of a separate division, department or underwriting office, and acts as an agent for the reinsurer, regardless of the title or designation of the person.

(c) "Business entity" has the meaning given that term in ORS 731.116.

(2) A person may act as an intermediary broker in this state only as follows:

(a) If a person maintains an office in this state either in the person’s own name or in the name of an agent that is a business entity, the person must meet either of the following requirements:

(A) If the person is an individual or a business entity, the person must hold a license issued under this chapter authorizing the person to act as an agent and indorsed with the designation of intermediary broker.

(B) If the person is an individual, the person must be authorized to act as an intermediary broker as provided in subsection (4) of this section under a license issued under this chapter to an agent that is a business entity and holds a license as an intermediary broker.

(b) If a person maintains an office in another state either in the person’s own name or in the name of an agent that is a business entity, the person must meet one of the following requirements:

(A) If the person is an individual or a business entity, the person must hold a license issued under this chapter authorizing the person to act as an agent and indorsed with the designation of intermediary broker.

(B) If the person is an individual, the person must be authorized to act as an intermediary broker as provided in subsection (4) of this section under a license issued under this chapter to an agent that is a business entity and holds a license as an intermediary broker.

(C) If the person is an individual or a business entity, the person must hold a license as an intermediary broker or intermediary manager issued by another state having a law substantially similar to the requirements of this chapter that apply to intermediary brokers and intermediary managers.

(3) A person may act as an intermediary manager only as follows:

(a) A person may act as an intermediary manager for a reinsurer domiciled in this state if the person meets either of the following requirements:

(A) If the person is an individual or a business entity, the person must hold a license issued under this chapter authorizing the person to act as an agent and indorsed with the designation of intermediary manager.

(B) If the person is an individual, the person must be authorized to act as an intermediary manager as provided in subsection (4) of this section under a license issued under this chapter to an agent that is a business entity and holds a license as an intermediary manager.

(b) A person may act as an intermediary manager in this state, when the person maintains an office in this state either in the person’s own name or in the name of an agent that is a business entity, if the person meets either of the following requirements:

(A) If the person is an individual or a business entity, the person holds a license issued under this chapter authorizing the person to act as an agent and indorsed with the designation of intermediary manager.

(B) If the person is an individual, the person is authorized to act as an intermediary manager as provided in subsection (4) of this section under a license issued under this chapter to an agent that is a business entity and holds a license as an intermediary manager.

(c) A person may act as an intermediary manager in another state for an authorized foreign or alien insurer transacting insurance in this state if the person meets one of the following requirements:

(A) If the person is an individual or a business entity, the person must hold a license issued under this chapter authorizing the person to act as an agent and indorsed with the designation of intermediary manager.

(B) The person, if an individual, is authorized to act as an intermediary manager as provided in subsection (4) of this section under a license issued under this chapter to an agent that is a business entity and holds a license as an intermediary manager.

(C) If the person is an individual or a business entity, the person must hold a license as an intermediary broker or intermediary manager issued by another state having a law substantially similar to the requirements of this chapter that apply to intermediary brokers and intermediary managers.

(4) An individual may act as an intermediary broker or an intermediary manager under the authority of the license of an agent that is a business entity, whether or not the individual holds a license as an agent, if the license of the agent that is a business entity is indorsed to authorize the agent that is a business entity to act as an intermediary broker or intermediary manager and if:

(a) The individual is a member, employee, officer or director of the business entity; and

(b) The individual is designated by the agent that is a business entity on its license application or an amendatory form or supplementary form thereto as authorized to act as an intermediary broker or intermediary manager under the authority of the license of the agent that is a business entity.

(5) In order to obtain and maintain the indorsement of intermediary manager, a person must satisfy the requirements of ORS 744.818 regarding errors and omissions insurance.

(6) A person may obtain a license to act as a nonresident agent authorized to act in this state as an intermediary broker or intermediary manager, or both as provided in ORS 744.063.

(7) For purposes of ORS 744.078:

(a) An intermediary broker is an agent of the ceding insurer on whose behalf the intermediary broker acts, and not an agent of the reinsurer.

(b) An intermediary manager is an agent of the reinsurer. [1993 c.447 §74; 2001 c.191 §41]

744.802 Exemptions from application of requirements for intermediary brokers and managers. (1) An officer or employee of a ceding insurer is not subject to the requirements of this chapter that apply to intermediary brokers, with respect to the ceding insurer.

(2) When engaged in a relationship described in this subsection, the following persons are not subject, with respect to the reinsurer in the relationship, to the requirements of this chapter that apply to intermediary managers:

(a) An employee of the reinsurer.

(b) A United States manager of the United States branch of an alien reinsurer.

(c) An underwriting manager who, pursuant to contract, manages all of the reinsurance operations of the reinsurer, is under common control with the reinsurer and subject to ORS 732.517 to 732.592, and whose compensation is not based on the volume of premiums written.

(d) The manager of a group, association, pool or organization of insurers who engage in joint underwriting or joint reinsurance and who are subject to examination by the insurance regulatory official of the state in which the manager’s principal business office is located.

(3) An attorney-at-law rendering services in the performance of duties of an attorney-at-law is not subject to the requirements of this chapter that apply to intermediary brokers or intermediary managers. [1993 c.447 §75]

744.804 Conditions under which intermediary broker and insurer may enter into transactions. An intermediary broker and the insurer it represents in the capacity of an intermediary broker may enter one or more transactions between them only pursuant to a written authorization that specifies the responsibilities of each party. The authorization must at least provide that:

(1) The insurer may terminate the authority of the intermediary broker at any time.

(2) The intermediary broker must render to the insurer accounts accurately detailing all material transactions, including information necessary to support all commissions, charges and other fees received by or owing to the intermediary broker, and remit all funds due to the insurer not later than the 30th day following the date of receipt.

(3) All funds collected for the account of the insurer must be held by the intermediary broker in a fiduciary capacity in a qualified United States financial institution. For purposes of this subsection, a "qualified United States financial institution" is an institution that:

(a) Is organized, or, in the case of a United States office of a foreign banking organization, is licensed, under the laws of the United States or any state thereof;

(b) Is regulated, supervised and examined by authorities of the United States or of any state thereof having regulatory authority over banks and trust companies; and

(c) Has been determined by the Director of the Department of Consumer and Business Services to meet standards of financial condition and standing that are necessary and appropriate for regulating the quality of financial institutions whose letters of credit will be acceptable to the director. The director may consider standards and classifications of institutions established by the Securities Valuation Office of the National Association of Insurance Commissioners for the purpose of making determinations under this paragraph.

(4) The intermediary broker must comply with ORS 744.806.

(5) The intermediary broker must comply with the written standards established by the insurer for the cession or retrocession of all risks.

(6) The intermediary broker must disclose to the insurer any relationship with any reinsurer to which business will be ceded or retroceded. [1993 c.447 §76]

744.806 Records required to be kept by intermediary brokers. (1) An intermediary broker must keep a complete record for each transaction of a contract of reinsurance as provided in this subsection. For each contract of reinsurance transacted by the intermediary broker that is limited to first party property coverages, the intermediary broker must keep the record for not less than five years after expiration of the contract of reinsurance. For all other contracts of reinsurance transacted by the intermediary broker, the intermediary broker must keep the record for not less than 10 years after expiration of each contract of reinsurance. The record must show all of the following:

(k) The following written evidence, when the intermediary broker procures a reinsurance contract on behalf of an authorized ceding insurer:

(A) When the contract is procured directly from any assuming reinsurer, written evidence that the assuming reinsurer has agreed to assume the risk.

(B) When the contract is placed through a representative of the assuming reinsurer other than an employee, written evidence that the reinsurer has delegated binding authority to the representative.

(2) The insurer must have access to and the right to copy and audit all accounts and records maintained by the intermediary broker and related to its business. The intermediary broker must maintain the accounts and records in a form usable by the insurer. [1993 c.447 §77]

744.808 Prohibition on use of unlicensed intermediary broker; requirement that insurer obtain financial statement of intermediary broker. (1) An insurer may not engage the services of any person to act as an intermediary broker on its behalf unless the person is licensed as an intermediary broker as required by ORS 744.800.

(2) An insurer may not employ an individual who is employed by an intermediary broker with which it transacts business unless the intermediary broker is under common control with the insurer and subject to ORS 732.517 to 732.592.

(3) The insurer must annually obtain a copy of statements of the financial condition of each intermediary broker with which it transacts business. [1993 c.447 §78]

744.810 Conditions under which intermediary manager and reinsurer may enter into transactions. An intermediary manager and the reinsurer it represents in that capacity may enter a transaction only pursuant to a written contract that specifies the responsibilities of each party and otherwise satisfies the requirements of this section. The contract must be approved by the board of directors of the reinsurer. Not later than the 30th day before the reinsurer assumes or cedes business through the intermediary manager, a true copy of the approved contract must be filed with the Director of the Department of Consumer and Business Services for approval. The contract must at least provide that:

(1) The reinsurer may terminate the contract for cause upon written notice to the intermediary manager, and the reinsurer may immediately suspend the authority of the intermediary manager to assume or cede business during the pendency of any dispute regarding the cause for termination.

(2) The intermediary manager must render accounts to the reinsurer, accurately detailing all material transactions and including information necessary to support all commissions, charges and other fees received by or owing to the intermediary manager and remit all funds due under the contract to the reinsurer on not less than a monthly basis.

(3) All funds collected for the account of the reinsurer must be held by the intermediary manager in a fiduciary capacity in a qualified United States financial institution as that term is described in ORS 744.804. The intermediary manager may retain not more than three months’ estimated claims payments and allocated loss adjustment expenses. The intermediary manager must maintain a separate bank account for each reinsurer that it represents.

(4) An intermediary manager must keep a complete record for each transaction of a contract of reinsurance as provided in this subsection. For each contract of reinsurance transacted by the intermediary manager that is limited to first party property coverages, the intermediary manager must keep the record for not less than five years after expiration of the contract of reinsurance. For all other contracts of reinsurance transacted by the intermediary manager, the intermediary manager must keep the record for not less than 10 years after expiration of each contract of reinsurance. The record must show all of the following:

(a) The type of contract, limits, underwriting restrictions, classes or risks and territory.

(b) The period of coverage, including effective and expiration dates, cancellation provisions and notice required of cancellation, and disposition of outstanding reserves on covered risks.

(c) Reporting and settlement requirements of balances.

(d) The rate used to compute the reinsurance premium.

(e) Names and addresses of reinsurers.

(f) The rates of all reinsurance commissions, including the commissions on any retrocessions handled by the intermediary manager.

(g) Related correspondence and memoranda.

(h) Proof of placement.

(i) Specific information regarding retrocessions handled by the intermediary manager, including the identity of retrocessionaires and percentage of each contract assumed or ceded.

(j) Financial records, including premium and loss accounts.

(k) The following written evidence, when the intermediary manager places a reinsurance contract on behalf of a ceding insurer:

(A) When the contract is procured directly from any assuming reinsurer, written evidence that the assuming reinsurer has agreed to assume the risk; or

(B) When the contract is placed through a representative of the assuming reinsurer, other than an employee, written evidence that the reinsurer has delegated binding authority to the representative.

(5) The reinsurer must have access to and the right to copy all accounts and records maintained by the intermediary manager that are related to its business. The intermediary manager must maintain the accounts and records in a form usable by the reinsurer.

(6) The contract cannot be assigned in whole or in part by the intermediary manager.

(7) The intermediary manager must comply with the written underwriting and rating standards established by the insurer for the acceptance, rejection or cession of all risks.

(8) The contract must set forth the rates, terms and purposes of commissions, charges and other fees that the intermediary manager may levy against the reinsurer.

(9) If the contract permits the intermediary manager to settle claims on behalf of the reinsurer, all of the following provisions must apply:

(a) All claims must be reported to the reinsurer in a timely manner.

(b) A copy of the claim file must be sent to the reinsurer at its request or as soon as it becomes known that the claim:

(A) Has the potential of exceeding the lesser of an amount determined by the director or the limit set by the reinsurer;

(B) Involves a coverage dispute;

(C) May exceed the claims settlement authority of the intermediary manager;

(D) Is open for more than six months; or

(E) Is closed by payment of the lesser of an amount set by the director or an amount set by the reinsurer.

(c) All claim files must be the joint property of the reinsurer and the intermediary manager. However, upon an order of liquidation of the reinsurer, the files shall become the sole property of the reinsurer or its estate but the intermediary manager shall have reasonable access to and the right to copy the files on a timely basis.

(d) Any settlement authority granted to the intermediary manager may be terminated for cause upon written notice by the reinsurer to the intermediary manager or upon the termination of the contract. The reinsurer may suspend the settlement authority during the pendency of the dispute regarding the cause of termination.

(10) If the contract provides for a sharing of interim profits by the intermediary manager, the interim profits must not be paid until one year after the end of each underwriting period for property business and five years after the end of each underwriting period for casualty business, or a later period set by the director for specified lines of insurance, and not until the adequacy of loss reserves on remaining claims has been attested to by an actuary pursuant to ORS 744.814.

(11) The intermediary manager must annually provide the reinsurer with a statement of its financial condition that is prepared by an independent certified public accountant.

(12) Periodically, but not less frequently than semiannually, the reinsurer shall conduct an on-site review of the underwriting and claims processing operations of the intermediary manager.

(13) The intermediary manager must disclose to the reinsurer any relationship it has with any insurer prior to ceding or assuming any business with such insurer pursuant to the contract.

(14) Within the scope of the actual or apparent authority of the intermediary manager, the acts of the intermediary manager are considered to be the acts of the reinsurer on whose behalf it is acting. [1993 c.447 §79]

744.812 Prohibitions on actions of intermediary managers. An intermediary manager shall not do any of the following:

(6) Jointly employ an individual who is employed by the reinsurer, unless the intermediary manager is under common control with the reinsurer subject to ORS 732.517 to 732.592.

(7) Appoint a subintermediary manager. [1993 c.447 §80]

744.814 Prohibition on use of unlicensed intermediary manager; requirement that reinsurer obtain financial statement of intermediary manager and opinion of actuary. (1) A reinsurer may not engage the services of any person to act as an intermediary manager on its behalf unless the person is licensed to act as an intermediary manager as required by ORS 744.800.

(2) A reinsurer shall annually obtain a copy of statements of the financial condition of each intermediary manager that the reinsurer has engaged. Each statement must be prepared by an independent certified public accountant in a form acceptable to the Director of the Department of Consumer and Business Services.

(3) If an intermediary manager establishes loss reserves, the reinsurer shall annually obtain the opinion of an actuary who is in good standing of the American Academy of Actuaries, attesting to the adequacy of loss reserves established for losses incurred and outstanding on business produced by the intermediary manager. The opinion must be in addition to any other required loss reserve certification.

(4) Binding authority for all retrocessional contracts or participation in reinsurance syndicates must rest with an officer of the reinsurer who is not affiliated with the intermediary manager.

(5) Not later than the 30th day after termination of a contract with an intermediary manager, the reinsurer shall provide written notification of the termination to the director.

(6) A reinsurer may not appoint to its board of directors any officer, director, employee, controlling shareholder or subproducer of its intermediary manager. This subsection does not apply to relationships governed by ORS 732.517 to 732.592. [1993 c.447 §81]

744.816 Director access to books, accounts and records. (1) The Director of the Department of Consumer and Business Services may examine any intermediary broker and any intermediary manager. The director shall have access to all books, bank accounts and records of an intermediary broker or intermediary manager being examined. All such books, bank accounts and records must be maintained in a form usable to the director.

744.818 Errors and omissions insurance for intermediary manager. (1) In addition to the requirements for licensure of an agent, an intermediary manager shall maintain with the Director of the Department of Consumer and Business Services a current certificate of errors and omissions insurance in an amount established by the director by rule from an insurer authorized to do business in this state or from any other insurer acceptable to the director according to standards established by rule.

(2) If the director determines that errors and omissions insurance required under this section is not generally available at a reasonable cost, the director by rule may suspend the requirement of insurance, but must reimpose the requirement when the insurance becomes available once again. [1993 c.447 §83]

744.820 Director authority if intermediary broker or manager violates provisions of ORS 744.800 to 744.818. If the Director of the Department of Consumer and Business Services finds that an intermediary broker or an intermediary manager has violated any provision of ORS 744.800 to 744.818, the director may order the intermediary broker or intermediary manager to reimburse the insurer, reinsurer, rehabilitator or liquidator for losses incurred by the insurer or reinsurer because of the violation. The director may take action under this section in addition to or instead of any other action that the director may take under the Insurance Code. [1993 c.447 §83a]

VEHICLE RENTAL COMPANIES

744.850 Definitions for ORS 744.850 to 744.858. As used in ORS 744.850 to 744.858:

(1) "Limited license" means a license issued under ORS 744.852 that authorizes a rental company to offer or sell insurance as provided in ORS 744.854.

(2) "Rental agreement" means a written agreement setting forth the terms and conditions governing use of a vehicle provided by a rental company for rent.

(3) "Rental company" means a person or entity in the business of providing motor vehicles to the public under a rental agreement for a period of 90 days or less.

(4) "Renter" means a person obtaining the use of a vehicle from a rental company for a period of 90 days or less.

(5) "Vehicle" means an automobile, van, minivan, sports utility vehicle, cargo van, pickup truck or truck with a gross vehicle weight of less than 26,000 pounds that does not require a commercial driver license to operate. [1999 c.485 §2]

Note: 744.850 to 744.858 were added to and made a part of the Insurance Code by legislative action but were not added to ORS chapter 744 or any series therein. See Preface to Oregon Revised Statutes for further explanation.

744.852 Limited license for rental companies; application; rules. (1) The Director of the Department of Consumer and Business Services shall adopt rules establishing information required to be submitted by rental companies applying for a limited license.

(2) A rental company that intends to offer insurance as described in ORS 744.854 shall file a limited license application with the director in such form and containing such information as the director requires.

(3) Upon receipt of an application, if the director is satisfied that the application is complete, the director may issue a limited license to the rental company. [1999 c.485 §3]

Note: See note under 744.850.

744.854 Kinds of insurance authorized by limited license. A limited license issued under ORS 744.852 authorizes a rental company to offer and sell the following kinds of insurance in connection with the rental of vehicles:

(1) Personal accident insurance covering the risks of travel, including but not limited to accident and health insurance that provides coverage to renters and other occupants of the rental vehicle for accidental death or dismemberment and reimbursement for medical expenses resulting from an accident that occurs during the rental period.

(2) Liability insurance that provides coverage to renters and other authorized drivers of the rental vehicle for liability arising from the operation of the rental vehicle. Liability insurance shall include uninsured and underinsured motorist coverage, insofar as required by state law or rule.

(3) Personal effects insurance that provides coverage to renters and other vehicle occupants for loss of and damage to personal effects during the rental period.

(4) Roadside assistance and emergency sickness insurance. [1999 c.485 §4]

Note: See note under 744.850.

744.856 Conditions for issuance of insurance; training; filing officer. (1) A rental company issued a limited license under ORS 744.852 may not issue insurance pursuant to ORS 744.854 unless:

(a) The rental agreement is for a period of 90 consecutive days or less.

(b) At every location where rental agreements are executed, there is written material available to prospective renters that:

(A) Summarizes clearly and correctly the material terms of the coverage offered and identifies the insurer;

(B) Discloses that the coverage offered by the rental company may duplicate coverage already provided by a renter’s personal motor vehicle liability insurance policy, personal liability insurance policy or other source of coverage;

(C) States that the purchase of the coverage offered is not required in order to rent a vehicle; and

(D) Describes the process for filing a claim.

(c) The written material referred to in paragraph (b) of this subsection has been filed with and approved by the Director of the Department of Consumer and Business Services.

(d) The rental agreement separately discloses the price for the coverage purchased.

(2) A rental company issued a limited license under ORS 744.852 must conduct a training program for employees concerning kinds of coverage offered by the company. The syllabus for the training program shall be filed annually with the Director of the Department of Consumer and Business Services by the rental company and is subject to approval by the director. The rental company shall certify annually to the director that all employees involved in the sale or offer of coverage to members of the public have completed or will complete the training program prior to conducting such sales or offers. The rental company shall also certify annually to the director that all such employees will receive continuing education on a regular basis concerning the topics covered in the training program. The rental company’s compliance with its certification to the director and with the filed training program syllabus is subject to audit by the Department of Consumer and Business Services.

(3) A rental company issued a limited license under ORS 744.852 may not advertise, represent or otherwise hold itself or its employees out as licensed insurers, insurance agents or insurance brokers.

(4) A rental company issued a limited license under ORS 744.852 may offer and sell insurance only in connection with and incidental to the rental of vehicles.

(5) A rental company issued a limited license under ORS 744.852 shall designate an executive as the statewide filing officer for the rental company. [1999 c.485 §5]

Note: See note under 744.850.

744.858 Revocation or suspension of limited license; other penalties; application of Insurance Code; rules. (1) If a rental company issued a limited license under ORS 744.852 offers or sells insurance not authorized by ORS 744.854, or violates any provision of ORS 744.856, the Director of the Department of Consumer and Business Services may, after notice and hearing, revoke or suspend the limited license or may impose such other penalties as the director prescribes, including but not limited to suspension of transaction of insurance at specific rental locations where violations of ORS 744.854 or 744.856 have occurred.

(2) All provisions of the Insurance Code apply to rental companies issued limited licenses under ORS 744.852 unless specifically rendered inapplicable by statute or by rule adopted by the director.

(3) The director may adopt any rules necessary for the implementation of ORS 744.850 to 744.858, including rules establishing license fees to defray the cost to the Department of Consumer and Business Services of administering the limited licensure program. [1999 c.485 §6]

Note: See note under 744.850.

744.990 [Repealed by 1967 c.359 §704]