State Laws

Claim Files

An insurer must document each claim in enough detail that pertinent events and their dates can be reconstructed.

Standard for Prompt Claim Investigation

An insurer must complete its claim investigation no later than 45 days after its receipt of notification of claim, unless the investigation cannot reasonably be completed within that time.

Standards for Prompt and Fair Settlements

An insurer must advise the claimant of the acceptance or denial of the claim within 30 days after receipt of proofs of loss from a first party claimant.

WORKERS COMPENSATION

Employment Covered: All workers are subject to the Workers' Compensation Law and benefits except the following: 1. Household domestic service or casual employment. 2. Any person engaged as a theatrical or stage performer or in an exhibition. 3. A worker engaged in the transportation in interstate commerce of goods, persons or property for hire by rail, water, aircraft or motor vehicle, and whose employer has no fixed place of business in this state. 4. Firefighter and police employees of any city having a population of more than 200,000 that provides a disability and retirement system by ordinance or charter. 5. Sole proprietors. 6. Members of limited liability companies. 7. Corporate officers who are Directors of the corporation and who have a substantial ownership interest in the corporation. 8. Any person performing services as a voluntary ski patrolman who receives no compensation for services other than meals, lodging, or use of the ski tow or lift facilities. 9. Any person who performs services as a sports official for a nominal fee at an amateur sporting event. 10. A newspaper carrier. 11. A person performing services on a volunteer basis for a nonprofit, religious, charitable or relief organization. -------------------------------- Covered Injuries: 1. A compensable injury is an accidental injury, or accidental injury to prosthetic appliances, arising out of and in the course of employment, which require medical services or result in disability or death. An injury is accidental if the result is an accident, whether or not due to accidental means, if it is established by medical evidence supported by objective findings, subject to the following limitations: --a. No injury or disease is compensable the injury is the major contributing cause of the consequential condition. --b. If an otherwise compensable injury combines at any time with a pre-existing condition, the combined condition is compensable only if the compensable injury is the major contributing cause of the disability or need for treatment. 2. Compensable injury does not include: --a. Injury to any active participant in assaults or combats which are not connected to the job's requirements. --b. Injury incurred while engaging in or performing any recreational or social activities primarily for the worker's personal pleasure. --c. Injury in which the major contributing cause was the worker being under the influence of alcoholic beverages or any controlled substance, unless the employer permitted, encouraged or had actual knowledge of such consumption. ------------------------------ Occupational Diseases: 1. Occupational Disease means any disease or infection arising out of and in the course of employment caused by substances or activities to which an employee is not ordinarily subjected or exposed, except when performing occupational duties. Occupational disease includes: --a. Any disease or infection caused by ingestion of, absorption of, inhalation of or contact with dust, fumes, vapors, gases, radiation or other substances. --b. Any mental disorder, whether sudden or gradual in onset, which requires medical services or results in physical or mental disability or death. --c. Any series of traumatic events or occurrences which requires medical services or results in physical disability or death. 2. Mental Disorder includes any physical disorder caused or worsened by mental stress. However, a mental disorder is not compensable unless the worker establishes all of the following: --a. The employment conditions producing the mental disorder exist in a real and objective sense. --b. The employment conditions producing the mental disorder are not inherent in every working situation. --c. There is a diagnosis of a mental or emotional disorder which is generally recognized in the medical or psychological community. --d. There is clear and convincing evidence that the mental disorder arose out of and in the course of employment. 3. Death, disability or impairment of health of firefighters caused by any disease of the lungs or respiratory tract, hypertension or cardiovascular-renal disease, is an "occupational disease" if 5 or more years of employment as a firefighter have been completed. 4. To be compensated for occupational diseases, the worker must prove that employment conditions were the major contributing cause of the disease. 5. Occupational diseases shall be subject to all of the same limitations and exclusions as accidental injuries under the Covered Injuries section above. ------------------------------- Benefits Provided: 1. Death - If death results from the accidental injury, payments shall be made as follows: --a. The cost of burial, including transportation of the body, shall be paid, not to exceed 10 times the average weekly wage in any case. --b. If the worker is survived by a spouse, monthly benefits shall be paid in an amount equal to 4.35 times 66-2/3% of the average weekly wage to the surviving spouse until remarriage. The payment shall cease at the end of the month in which the remarriage occurs. --c. If the worker is survived by a spouse, monthly benefits also shall be paid in an amount equal to 4.35 times 10 % of the average weekly wage for each child of the deceased who is substantially dependent on the spouse for support, until such child becomes 18 years of age. 2. Upon remarriage, a surviving spouse shall be paid 36 times the monthly benefit in a lump sum as final payment of the claim, but the monthly payments for each child shall continue as before. 3. If the worker leaves a dependent other than a surviving spouse or a child, a monthly payment shall be made to each dependent equal to 50% of the average monthly support actually received by such dependent from the worker during the 12 months next preceding the occurrence of the accidental injury. If a dependent is under the age of 18 years at the time of the accidental injury, the payment to the dependent shall cease when such dependent becomes 18 years of age. 4. Permanent/Total Disability - When permanent total disability results from the injury, the worker shall receive compensation benefits equal to 66-2/3 % of his/her average weekly wages but not less than $50 per week. 5. The worker has the burden of proving permanent total disability status and must establish that the worker is willing to seek regular gainful employment and that the worker has made reasonable efforts to obtain such employment. 6. Temporary Disability - When the total disability is only temporary, the worker shall receive 66-2/3 % of wages, but not less than $50 per week. 7. Impairment Percentages - Impairment benefits awarded shall be expressed as a percentage of the whole person. Impairment benefits for the following body parts may not exceed: a. For the loss of one arm at or above the elbow joint, 60%. b. For the loss of one forearm at or above the wrist joint, or the loss of one hand, 47%. c. For the loss of one leg, at or above the knee joint, 47%. d. For the loss of one foot, 42%. e. For the loss of a big toe, 6%; for loss of any other toe, 1%. f. For partial or complete loss of hearing in one ear, that proportion of 19% which the loss bears to normal monaural hearing. g. For partial or complete loss of hearing in both ears, that proportion of 60% which the combined binaural hearing loss bears to normal combined binaural hearing. Combined binaural hearing loss shall be calculated by taking seven times the hearing loss in the less damaged ear plus the hearing loss in the more damaged ear and dividing that amount by 8. In the case of individuals with compensable hearing loss involving both ears, either the method of calculation for monaural hearing loss or that for combined binaural hearing loss shall be used, depending upon which allows the greater award of impairment. h. For partial or complete loss of vision of one eye, that proportion of 31% which the loss of monocular vision bears to normal monocular vision. For the purposes of this paragraph, the term "normal monocular vision" shall be considered as 20/20 for distance and 14/14 for near vision with full sensory field. i. For partial loss of vision in both eyes, that proportion of 94% which the combined binocular visual loss bears to normal combined binocular vision. In all cases of partial loss of sight, the percentage of said loss shall be measured with maximum correction. Combined binocular visual loss shall be calculated by taking 3 times the visual loss in the less damaged eye plus the visual loss in the more damaged eye and dividing that amount by 4. In the case of individuals with compensable visual loss involving both eyes, either the method of calculation for monocular visual loss or that for combined binocular visual loss shall be used, depending upon which allows the greater award of impairment. j. For the loss of a thumb, 15%. k. For the loss of a first finger, 8%; of a second finger, 7%; of a third finger, 3%; of a fourth finger, 2%. ------------------------------- Exclusive Remedy 1. The liability of every employer who satisfies the requirements of Workers' Compensation laws is exclusive of all other liability arising out of injuries, diseases, symptom complexes or similar conditions arising out of and in the course of employment. This remedy covers subject workers, the workers' beneficiaries and anyone otherwise entitled to recover damages from the employer on account of such conditions or claims. 2. The rights given to a subject worker and his/her beneficiaries for injuries, diseases, symptom complexes or similar conditions arising out of and in the course of employment are in lieu of any remedies they might otherwise against the worker's employer. ------------------------------ Workers' Compensation Handicapped Workers Program: This program is intended to encourage the hiring or rehiring of workers already having disabilities. If an employer hires a worker who disabled and is receiving disability benefits and that worker becomes injured: 1. The Director must determine if the second injury was or was not related to the original disability. 2. If the Director determines that the second injury or death was directly related to the original disability, the Director may reimburse the paying agency for compensation amounts in excess of $1,000 per claimant for all subsequent injuries throughout the claimant's working career, paid as the result of the condition. ------------------------------- Oregon Workers' Compensation Insurance Plan: The Oregon Workers' Compensation Insurance Plan provides for the equitable apportionment among Workers' Compensation insurers who are in good faith entitled to Workers' Compensation insurance, but who are unable to procure such insurance in a regular manner. 1. All insurers authorized to transact Workers' Compensation insurance in Oregon are required to participate in the Plan and subscribe to the organizing principles for Oregon. 2. Failure of an insurer to comply with the Plan is grounds for revocation of the insurer's certificate of authority to transact Workers' Compensation insurance. 3. Each insurance producer who is authorized to transact the class of property and casualty insurance is authorized to transact Workers' Compensation insurance offered by the Plan. The Director of the Department of Consumer and Business Services may terminate a producer's authority under this section for cause. 4. All insurers participating in the Plan through the Reinsurance Agreements provided for in the organizing principles shall share in the writings, expenses, servicing allowance and losses. Each insurer's participation in the Plan shall: --a. Be in the proportion that the total net premiums of all member insurers bear to the aggregate direct premiums of all member insurers participating through the Reinsurance Agreements during the preceding calendar years. --b. Be determined on the basis of the direct premiums as reported in the most recent annual reports filed with the regulatory authority. -------------------------------- Self-Insured Employers/Employer Groups 1. An employer shall establish proof with the Director of the Department of Consumer and Business Services that the employer is qualified either: --a. As a carrier-insured employer by causing proof of coverage provided by an insurer to be filed with the Director, or --b. As a self-insured employer by establishing proof that the employer has an adequate staff qualified to process claims promptly and has the financial ability to make certain the prompt payment of all compensation and other payments that may become due to the Director under this chapter. 2. A self-insured employer shall establish proof of financial ability by providing security of: --a. Not less than the employer's normal expected annual claim liabilities; or --b. Not less than $100,000, whichever is greater. 3. In arriving at the amount of security required, the Director may take into consideration the financial ability of the employer to pay compensation and probable continuity of operation. 4. The security shall be held by the Director to secure the payment of compensation for injuries to subject workers and to secure other payments that may become due from the employer to the Director. 5. Moneys received as security shall be deposited with the State Treasurer in an account separate and distinct from the General Fund. Interest earned by the account shall be credited to the account. The amount of security may be increased or decreased from time to time by the director. 6. Employer Groups - Two or more entities shall not be included in the certification of one employer unless in each entity the same person, or group of persons, or corporation owns a majority interest. If an entity owns a majority interest in another entity which in turn owns the majority interest in another entity, all entities so related may be combined regardless of the number of entities in succession. 7. The Director may certify 5 or more subject employers as a self-insured employer group if: --a. The Director finds that the employers as a group meet the applicable requirements. --b. The Director determines that if the employers as a group have insurance coverage with a retention of $100,000 or more, the employers have a combined net worth of $1 million or more. --c. The Director finds that the grouping is likely to improve accident prevention and claims handling for the employer. -------------------------------- Workers' Compensation Insurance Claim Settlement Standards: 1. An insurer is required to conduct a reasonable investigation based on all available information to determine whether to deny a claim. 2. A reasonable investigation is whatever steps a reasonably prudent person with knowledge of the legal standards for determining compensability would take in a good faith effort to determine the facts underlying a claim. 3. In determining whether an investigation is reasonable, the Director will only look at information contained in the claim record at the time of denial. The insurer may not rely on any fact not documented in the claim record at the time of denial to establish that an investigation was reasonable. ------------------------------- Other Coverages and Options: Surplus Lines 1. Insurance may be procured through a surplus lines licensee from a non-admitted insurer if: --a. The insurer is an eligible surplus lines insurer; --b. A diligent search has first been made among the authorized insurers who are actually writing the particular kind and class of insurance in Oregon and it is determined that the full amount or kind of insurance cannot be obtained from those insurers; and --c. All other requirements of applicable Oregon insurance statutes are met. 2. A surplus lines licensee may not place any coverage with a nonadmitted insurer unless, at the time of placement, the nonadmitted insurer meets the following criteria: --a. Obtained authorization from the insurer's domiciliary jurisdiction to write the kind of insurance to be placed; and; --b. Has the required capital and surplus ------------------------------ Residual Markets: Joint Underwriting Association 1. Each casualty insurer must provide commercial liability coverage through a joint underwriting association as a condition of its authority to transact business in this state. 2. The Director annually holds a public hearing to determine if the coverage the Association provides is still unavailable in the voluntary insurance market. If the coverage is available in the normal market, the Association must cease providing it. 3. The Association must annually file a certified financial statement with the Director. 4. The Association may impose a surcharge for its coverage, subject to the Director's approval. 5. An insurer engaging in joint underwriting may not act unfairly, unreasonably, or illegally. ------------------------------- Oregon FAIR Plan Association: Every insurer writing essential property insurance in Oregon must be a member of the Association as a condition of its authority to transact property insurance in Oregon. The purposes of the Oregon FAIR Plan Association are as follows: 1. To ensure stability in the property insurance market. 2. To ensure the availability of essential property insurance to owners of insurable property. 3. To encourage the attainment of essential property insurance in the normal market. 4. To hold authorized insurers equitably responsible for the insurance issued through the FAIR Plan.

Auto Insurance: Oregon Financial Responsibility Law

Required Limits and Proof of Liability: 1. A driver who fails to show proof of compliance with financial responsibility requirements upon a police officer's request shall be deemed not to be in compliance with financial responsibility requirements. Financial responsibility is established by one of the following being in the applicable vehicle(s) at all times: --a. An unexpired insurance card issued by the auto insurer. --b. Self insurance certification documents approved by the Department of Transportation. --c. The use of an electronic device to display proof of insurance does not constitute consent for a police officer to access other contents of the electronic device. 2. A person may meet financial responsibility requirements by self-insuring, or by obtaining an auto liability policy, providing at least the following minimum limits of liability: --a. $25,000 for bodily injury to any one person in any one accident. --b. $50,000 for bodily injury to all persons in any one accident. --c. $20,000 for damage to the property of others in any one accident. 3. An auto liability policy must designate all autos covered and must cover all insureds and permissive users other than any person specifically excluded from coverage. -------------------------------- Personal Injury Protection: 1. Every motor vehicle liability policy issued for delivery in this state that covers any private passenger motor vehicle must provide personal injury protection benefits to: --a. The person insured. --b. Members of that person's family residing in the same household. --c. Children not related to the insured by blood, marriage or adoption who are residing in the same household as the insured and being reared as the insured's own. --d. Passengers occupying the insured motor vehicle; and --e. Pedestrians struck by the insured motor vehicle. 2. Personal injury protection benefits apply to a person's injury or death resulting from the use, occupancy or maintenance of any motor vehicle, except a motorcycle or moped. 3. Personal injury protection benefits consist of the following payments for the injury or death of each person: --a. All reasonable and necessary expenses of medical, hospital, dental, surgical, ambulance and prosthetic services incurred within 2 years after the date of the person's injury, but not more than $15,000 in the aggregate for all such expenses of the person. --b. If the injured person is usually engaged in an occupation and if disability continues for at least 14 days, 70% of the loss of income from work during the period of the injured person's disability until the date the person is able to return to the person's usual occupation, subject to a maximum payment of $3,000 per month and a maximum payment period in the aggregate of 52 weeks. --c. If the injured person is not usually engaged in an occupation and if disability continues for at least 14 days, the expenses reasonably incurred by the injured person for essential services that were performed by a person who is not related to the injured person or residing in the injured person's household. This benefit is subject to a maximum payment of $30 per day and a maximum payment period in the aggregate of 52 weeks. --d. All reasonable and necessary funeral expenses incurred within one year after the date of the person's injury, subject to a maximum of $5,000. --e. If the injured person is a parent of a minor child and is required to be hospitalized for a minimum of 24 hours, $25 per day for child care, with payments to begin after the initial 24 hours of hospitalization and to be made for as long as the person is unable to return to work, but not to exceed $750. 4. With respect to the insured person and members of that person's family residing in the same household, an insurer may offer forms of coverage for the benefits with deductibles of up to $250. 5. An insurer who denies payment of personal injury protection benefits must: --a. Provide written notice of the denial, within 60 calendar days of receiving a claim from the provider, to the insured, stating the reason for the denial and informing the insured of the method for contesting the denial. --b. Provide a copy of the notice of the denial, within 60 calendar days of receiving a claim from the provider, to a provider of services. 6. The insurer may exclude from the coverage for personal injury protection benefits any injured person who: --a. Intentionally causes self-injury. --b. Is participating in any prearranged or organized racing or speed contest or practice or preparation for any such contest. --c. Willfully conceals or misrepresents any material fact in connection with a claim for personal injury protection benefits. 7. A provider of personal injury protection benefits shall be reimbursed for personal injury protection payments made on behalf of any person only to the extent that the total amount of benefits paid exceeds the economic damages suffered by that person. ------------------------------- Uninsured/Underinsured Motorist's Coverage: 1. Every auto liability insurer must provide uninsured/underinsured motorists coverage with every auto liability policy. 2. The UM/UIM limits must at least equal the bodily injury or death limits of the liability policy unless the named insured elects lower limits in writing. ------------------------------- Aftermarket Crash Parts Act: 1. Aftermarket Crash Part - An auto replacement part that constitutes the auto's visible exterior, is generally repaired or replaced because of a collision, and is not supplied by the OEM. 2. An insurer may not require an auto shop to supply or install any aftermarket crash part without the auto owner's consent unless the part has been independently certified to be at least as good as the part being replaced when considering fit, finish, function, and corrosion resistance. 3. Auto parts supplied by the original equipment manufacturer (OEM) must be under warranty. If crash parts are not supplied by the OEM, the estimate must disclose this fact. 4. Upon the insured's request an insurer must make available crash part warranties for parts that are not OEM. ------------------------------- Total Loss: 1. When an insurer declares a motor vehicle a total loss and offers to make a cash settlement to an insured or third-party owner, the insurer must provide: a. Any valuation or appraisal reports relied upon by the insurer to determine value; and b. A written statement that includes: **1) Information about total loss, vehicle valuation and the duties of the insurer; and **2) The manner in which and under what circumstances the insured may contact the Insurance Division. 2. 'Totaled Vehicle' or 'Totaled', means: a. A vehicle that is declared a total loss by an insurer that will either cover the loss or takes possession of the vehicle or its title; b. A vehicle that is stolen, if it is not recovered within 30 days of the date that it is stolen and if the loss is not covered by an insurer; c. A vehicle that has sustained damage that is not covered by an insurer and the estimated cost to repair the vehicle is equal to at least 80% of the vehicle's retail market value prior to the damage. 'Retail Market Value' shall be as reflected in publications used by financial institutions doing business in Oregon. 3. An insurer is guilty of 'insurer failure to follow procedures for a totaled vehicle' if the insurer declares that the vehicle is a totaled vehicle and does not: a. Obtain the Certificate of Title from the owner as a condition of claim settlement and surrender it to the Department of Transportation within 30 days of its receipt; or b. Notify the owner that s/he must surrender the Certificate to the DOT within 30 days of the insurer declaring the vehicle to be totaled, and c. Notify the registered owner that any subsequent purchaser that the vehicle is a totaled vehicle. 4. The insurer may elect to offer a replacement automobile that is at least comparable to the totaled automobile. A replacement automobile is at least comparable if: a. It is the same make, the same year or newer, b. Is of a similar body style, has similar options and mileage as the insured automobile, c. It is in as good or better overall condition and is available for inspection within a reasonable distance of the insured's residence. NOTE: The insurer shall pay all applicable taxes, license and other fees incident to the transfer of evidence of ownership at no cost other than any deductible provided in the policy. The offer and any rejection must be documented in the claim file. 5. The insurer may elect to make a cash settlement, less any deductible, but including all applicable taxes, license fees and other fees incident to transfer of ownership of another comparable automobile. When an insurer makes a cash settlement, the insurer shall furnish the insured copies of the information used by the insurer for the purpose of determining the amount of the cash settlement. 6. An auto's valuation may be obtained from a computerized database source that produces statistically valid and fair market values for automobiles on the basis of the following criteria: a. The source shall produce values for at least 85% of all makes and models of private passenger automobiles for the last 15 model years; b. The source shall rely upon values of vehicles that are currently available or were available within the last 90 days from the date of loss and shall apply appropriate standards of comparability; c. For all vehicles five or less years old, the values must be derived primarily from verifiable data or inventory from licensed dealers; d. The source shall give primary consideration to the values of vehicles in the local market area and may consider data on vehicles outside the area. 7. The insurer may either pay the insured the difference between the market value (before applicable deductions) and the cost of the comparable automobile that the insured has located, or negotiate and purchase the automobile for the insured; 8. The insured's right to have a claim reopened applies only to first party claims of the insured under the policy. The insured must show that the documentation provided by the insurer at the time of settlement did not include: a. Written notification of the availability and location of a specified automobile that is at least comparable to the totaled automobile, and b. That could have been purchased for the market value determined by the insurer before applicable deductions. Otherwise, the insurer is not required to take any actions. 9. When the issue of liability is reasonably clear, an insurer shall not recommend that a third party claimant make the claim under the claimant's own insurance policy, solely to avoid paying a claim. 10. When the damage amount claimed is reduced because of betterment or depreciation, all information used as the basis for the reduction shall be contained in the insurer's claim file. Such deductions shall be itemized and specified as to dollar amount and shall be appropriate for the amount of betterment or depreciation. ------------------------------- Credit History: 1. An insurer that issues personal insurance policies in this state may not cancel or non-renew personal insurance that has been in effect for more than 60 days based in whole or in part on a consumer's credit history or insurance score. 2. An insurer may use a consumer's credit history to decline coverage of personal insurance in the initial underwriting decision only in combination with other substantive underwriting factors. An offer of placement with an affiliate insurer does not constitute a declination of insurance coverage. 3. If an insurer uses the consumer's credit history or insurance score at any time in the rating of a personal insurance policy, the consumer may request, no more than once per year, that the insurer re-rate the consumer according to the standards that the insurer would apply if the consumer were initially applying for the same insurance policy. 4. The insurer must re-rate the consumer within 30 days after receiving a request from the consumer. After re-rating the consumer based upon the request, the insurer may not use credit information from re-rating to increase the premium on any personal insurance policy the consumer holds. 5. If a request to re-rate a policy is received within 60 days prior to a renewal date, or if the difference between the current rate and the improved rate is less than $10, the insurer may provide the consumer with the difference between the current rate and the improved rate over the remainder of the current period as a credit upon renewal. 6. If the policy is canceled or not renewed, the insurer must refund the unearned premium. Any existing claim-related discounts or surcharges shall carry forward for each re-rated policy. 7. An insurer may only use rating factors other than credit history or insurance score to re-rate the policy at renewal. ------------------------------- Standards for Prompt and Fair Settlements - Automobile Insurance: 1. When an automobile insurance policy provides for the adjustment and settlement of collision or comprehensive coverage total losses on the basis of actual cash value or replacement with another comparable automobile or one of like kind and quality, the insurer may elect to offer a replacement automobile that is at least comparable to the insured automobile. 2. The insurer may elect to make a cash settlement, less any deductible provided in the policy, but including all applicable taxes, license fees and other fees incident to transfer of ownership of another comparable automobile. 3. When the issue of liability is reasonably clear, an insurer shall not recommend that a third-party claimant make claim under the claimant's own insurance policy solely for the recommending insurer to avoid paying a claim. 4. An insurer may not require unreasonable travel of a claimant to inspect a replacement automobile, to obtain a repair estimate or to have the automobile repaired at a repair shop. 5. An insurer may not require that a particular person make the repairs to the first-party claimant's automobile as a condition for recovery under the claimant's policy. ------------------------------ Grounds for Cancellation of Automobile Policies: 1. A notice of cancellation of a policy will be effective only if it is based on one or more of the following reasons: a. Nonpayment of premium; b. Fraud or material misrepresentation or violation of any of the policy terms or conditions; c. The named insured or any operator who is either resident in the same household or who customarily operates an insured automobile: **1) Has had driving privileges suspended or revoked during the policy period, or **2) If the policy is a renewal, during its policy period or the 180 days immediately preceding its effective date. **Note: An insurer may not cancel a policy for the reason that the driving privileges of the named insured or operator were suspended if the suspension was based on a nondriving offense. 2. This section does not apply to any policy or coverage which has been in effect less than 60 days at the time the notice of cancellation is mailed or delivered, unless it is a renewal policy. 3. This section does not apply to nonrenewal.

Commercial Liability Policies

1. A commercial liability policy may be cancelled before its expiration date only for one or more of the following reasons: -a. Nonpayment of premium. -b. Fraud or material misrepresentation knowingly made by or for the named insured. -c. Substantial increase in risk. -d. Failure to comply with reasonable recommendation for controlling loss. -e. Substantial breach of contract. -f. The Director's determination that continuing the coverage will jeopardize the insurer financially or result in the insurer breaking any state's insurance law. -g. Decrease in reinsurance covering the risk. -h. Any other reason, as approved by the Director. 2. An insurer may not cancel a commercial liability policy until 10 working days after the insured receives its written notice of cancellation. The notice must state the reason for cancellation and inform the insured of its right to a hearing. 3. An insurer must give an insured 45 days' written notice before implementing, at a commercial liability policy's renewal, any reduction in coverage limits, any new terms, or any change in rates. This does not apply to a rate change based on increased risk or a rate change filed with the Director and applicable to an entire insurance line or business class. **Note: If the insurer fails to provide this notice, the insured may cancel the policy for a pro rata premium refund within 45 days after receiving the notice. 4. Nonrenewal of a commercial liability policy may not be effective until 45 days after the insured receives written notice of the nonrenewal. 5. An insurer may not nonrenew a commercial liability policy or implement a mid-term premium increase if the policy's term exceeds 1 year and the insured has paid an additional premium for guaranteed renewal. 6. Proof that the cancellation notice was mailed is deemed proof of receipt on the 3rd day after mailing. 7. An insured has 30 days after receiving a cancellation notice for a policy in effect for 60 or more days or a renewed policy in which to request a hearing before the Director. This does not apply to Workers' Compensation insurance, insurance from an assigned risk program, or any excess liability policy.

Company Regulation: (Producer Appointment)

1. A producer may not act as an agent unless appointed as an agent by the insurer or transacts insurance on behalf of another insurance producer who is an appointed agent of that insurer according to conditions and limitations established by the Director. 2. Each insurer must maintain a current list of insurance producers contractually authorized to accept applications on behalf of the insurer and make the list available to the Director upon request. 3. A producer may represent as many insurers as may appoint the producer 4. Any person who solicits or procures an application for insurance as an agent of the insurer must be regarded as the agent of insurer issuing the policy and not an agent of the insured. 5. A group contract of insurance may contain provisions stating whether the group policyholder acts as an agent of the individual insured or as an agent of the insurer.

Records Maintenance

1. A resident producer must keep records pertaining to the business under the resident producer license for 3 years following expiration of the policy. All such records shall be kept available and open to the inspection of the Director during business hours. 2. A nonresident insurance producer shall keep at his / her principal place of business, the usual and customary records pertaining to the business transacted under the nonresident insurance producer license. All such records shall be kept available and open to the Director's inspection during business hours. If a nonresident insurance producer has a place of transacting insurance in this state, that place shall be the principal place of business for the nonresident insurance producer. All insurance transaction records will be maintained for 3 years following the completion, cancellation or expiration of a transaction or contract.

Required Claim Communication Practices

1. Acknowledge the notification of a claim or pay the claim within 30 days after receipt of notification of claim. 2. Furnish the Director with an adequate response within 21 days after receipt of an inquiry from the Director about a claim. 3. Make an appropriate reply, not later than the 30th day after receipt, to all other pertinent communications about a claim from a claimant that reasonably indicate a response is expected.

Producer Regulation: (Fiduciary Responsibilities)

1. All fiduciary funds received or collected by a producer are trust funds received in a fiduciary capacity. 2. The producer must account for and pay funds to the person entitled to the funds. 3. The producer must establish a separate account for funds belonging to others in order to avoid commingling fiduciary funds with his/her own funds. 4. A producer must deposit premium funds received into a premium fund account no later than the 7th day after they are received. 5. When a payment is owed to an insured, the producer must pay the premium funds no later than the 30th day after the receipt of the funds. 6. A producer may advance return premiums from the producer's funds, other than from a trust account, in anticipation of receiving a credit for the return premium from the insurer. 7. A producer may not deposit any funds, other than premium funds, in a premium fund trust account, except as follows: -a. Funds to pay bank charges. -b. Funds for advancing premiums or establishing reserves for the paying of return premiums. -c. Funds for contingencies that may arise in the course of receiving and transmitting premiums. 8. A producer must establish and maintain records and an appropriate accounting system for all premium funds received. 9. The Director may, at the expense of the producer, examine or audit any trust account and any accounting records of premium funds as the Director determines necessary.

Reporting of Actions

1. An insurance producer must report to the Director no later than 30 days of final disposition any administrative action taken against the producer in any jurisdiction or by another governmental agency in this state. The report must include a copy of the order, consent to order and any other relevant legal documents. 2. An insurance producer must report to the Director no later than 30 days after the pretrial hearing date any criminal prosecution of the producer taken in any jurisdiction. The report must include the initial complaint filed, the order resulting from the hearing and any other relevant documents

Property Insurance Policies

1. An insured canceling a fire insurance policy by surrendering it to the insurer is entitled to a short rate refund of any unearned premium. 2. An insurer must give an insured at least 30 days' written notice before canceling a fire insurance policy, except that only 10 days' written notice is required if canceling for nonpayment of premium. The insurer must refund any unearned premium upon demand.

Termination of Appointment

1. An insurer may terminate an agency appointment at any time without prejudice to the contract's rights of the insurance producer terminated. 2. An insurer must give a producer at least 90 days' written notice prior to the effective date of the termination the producer's appointment. The notice must specify the reasons for the termination and be delivered in person or by mail to the last known address provided by the producer to the insurer. The producer will not have cause of action against the insurer unless any statement in the notice is false and the insurer knew the statement was false when made. 3. An insurer may terminate an agency appointment without notice for the following reasons: a. The insurance producer's license is denied, restricted, revoked, suspended or canceled b. The insurance producer's business is sold, transferred, or merged without an appointed successor c. The insurance producer is insolvent or fails to remit balances to the insurer in accordance with the agreement d. The insurance producer commits fraud or engages in intentional misconduct e. The insurer amends its certificate of Authority in order to discontinue a class of insurance f. The insurer ceases selling in this state g. The insurer and producer mutually agree to terminate the agency appointment 4. An insurance producer may terminate an agency appointment at any time and must give written notice of the termination to the Director and insurer not later than 30 days after the effective date. The Director may require reasonable proof from the insurance producer that such notice was given to the insurer.

Commissions/Service Fees

1. An insurer or producer 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 and is not licensed. 2. No person may accept a commission, service fee, brokerage, or other valuable consideration for selling, soliciting or negotiating insurance in this state if that person is required to be licensed and is not licensed. 3. Renewal or other deferred commissions may be paid to a person for selling, soliciting, or negotiating insurance in this state if: -a. The person was required to be licensed at the time the sale, solicitation, or negotiation of insurance occurred; and -b. The person was licensed when the sale, solicitation, or negotiation of insurance occurred. 4. Any insurance agent may pay or assign a commission, service fee, brokerage, or any other valuable consideration to persons who do not sell, solicit, or negotiate insurance. 5. The Director establishes by rule the conditions under which a person who is licensed as a producer and as an insurance consultant may accept a commission or a fee, or both, in a transaction or in related transactions. 6. Except as otherwise provided by rule, an producer who is not licensed as an insurance consultant may receive only commission. 7. A service fee may not be charged for insurance transactions covering an individual's person, property, or liability. 8. A service fee may be charged for insurance transactions other than those covering an individual's person, property, or liability.

Termination of Relationship with an Insurance Producer

1. An insurer who terminates the appointment, employment, contract, or business relationship with an insurance producer must notify the Director not later than 30 days after the effective date of the termination if the reason for termination is just cause for the Director to place a licensee on probation, or suspend, revoke, refuse to issue or renew a producer license. Upon written request, the insurer must provide additional information, documents, records, or other data pertaining to the termination or activity of the insurance producer. 2. The insurer must notify the Director if, upon further review or investigation, the insurer discovers additional information that would have been reportable to the Director if the insurer had known of its existence. 3. The insurer must mail a copy of the notification to the producer at the producer's last known business address not later than 15 days after required notification to the Director. If the reason for termination is just cause for the Director to place a licensee on probation, or suspend, revoke, refuse to issue or renew a producer license, the insurer must provide a copy of the notification to the insurance producer at the last known business address by certified mail, return receipt requested, postage prepaid or by overnight delivery using a nationally recognized carrier. 4. The insurance producer has no more than 30 days from the notification to file with the Director written comments concerning the substance of the notification. The insurance producer must simultaneously send a copy of the comments to the reporting insurer. The comments will become a part of the director's file and accompany every copy of a report distributed or disclosed for any reason about the insurance producer. 5. 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 or an insurance producer who fails to file notice as required. 6. Any information, documents, or records in possession of the Director that are furnished by an insurer or an insurance producer, or that are obtained by the Director in an investigation will be confidential and not be subject to subpoena nor admissible as evidence in any private civil action. The Director, however, may use the confidential information, documents, or records in administering any other regulatory or legal action brought as a part of the Director's duties.

Maintaining A License: (License Renewal)

1. An producer license remains in effect unless revoked or suspended as long as all applicable fees are paid by the due date and continuing education requirements have been satisfied. 2. The renewal fee is due on the last day of the month of the second anniversary of the date of the license was issued. 3. As a condition for the renewal of an insurance producer license, the Director may require the producer to file information regarding the use of the license during the previous year or 2 years. 4. The Director may require an producer, as a condition for renewal of the producer license, to fulfill any or all of the requirements then applicable to the original issuance of the license. 5. A producer who allows his/her license to lapse may apply to reinstate the same license within 12 months from the due date for renewal without having to take and pass a written examination. 6. A producer who is unable to comply with license renewal procedures due to military service or another extenuating circumstance may request a waiver from compliance with those procedures.

Binders

1. Binders for property or casualty insurance may be made orally or in writing and are valid for up to 90 days unless extended with the Director's written approval. 2. If the policy has not been issued a binder may be extended or renewed beyond such 90 days with the written approval of the Director of the Department of Consumer and Business Services, or in accordance with such rules as the Director may promulgate. 3. This does not apply to life or health insurance.

Maintaining A License: (Continuing Education)

1. Continuing education (CE) is required for all resident Oregon agents with life, health, property, casualty, personal lines, surplus lines, or variable life lines of authority. 2. Each 2-year renewal cycle requires 24 hours of CE credit including: -a. At least 3 hours must be professional ethics -b. At least 3 hours must be on Oregon statutes and administrative rules, including recent changes -c. No more than 4 hours is allowed for approved agency management courses -d. Not more than 8 hours CE credit will be given in any 1 day 3. CE hours are due by the last day of the renewal month. 4. Continuing education is not required for: -a. Adjusters or consultants -b. Any person to whom a license is issued without examination. -c. Any retired person who is authorized to transact life insurance only, if the person is 58 years of age or more, has 10 years of experience as a producer, and will be servicing existing policies only.

Criminal Penalties

1. Giving known false or misleading information regarding insurance applications or transactions is punishable upon conviction, in the case of an individual, by imprisonment in the county jail for not more than one year or by a fine not exceeding $1,000; or, in the case of a corporation, by a fine not exceeding $10,000. 2. Violation of any provision of the Insurance Code for which a greater penalty is not otherwise provided by the Insurance Code or by other applicable laws of this state, in addition to any applicable prescribed denial, suspension or revocation of any certificate or license or any civil forfeiture, shall be punishable upon conviction as for a misdemeanor.

Auto Liability Policies

1. If an auto liability policy's owner is one or more companies, the insurer does not need the insured's signed consent to decrease the uninsured motorist coverage limits at policy renewal. 2. PIP limits may be reduced by PIP benefits paid. 3. UM/UIM coverage benefit payments may be reduced by PIP benefits paid for the same accident.

Policy Renewal and Refusal to Renew

1. Insurers must offer a policy renewal, contingent upon payment of premium, unless the insurer mails or delivers a notice of nonrenewal at least 30 days before a renewal would take effect. Such notice shall specify the reason(s) for nonrenewal. 2. If the insurer fails to provide a notice of nonrenewal, the policy will still terminate on the effective date of any replacement or succeeding automobile insurance policy. 3. An insurer may not refuse to renew a policy due to the insured's suspension of driving privileges: --a. If the insured is a juvenile aged 13-17 and is convicted of any offense involving the delivery, manufacture or possession of controlled substances. --b. If the insured is a juvenile aged 13-20 and is convicted of any offense involving the possession, use or abuse of alcohol. --c. If the suspension was based on a nondriving offense.

Concealment, Misrepresentation, or Fraud

1. Misrepresentations, omissions, concealment, and incorrect statements may prevent recovery only if they are material, are in a written application attached to the policy at issuance, and are either fraudulent or material to the hazard or to the insurer's acceptance of the risk. 2. A fire policy must provide that: --a. It is void if the insured commits fraud or willfully conceals or misrepresents any material fact about the insurance, the risk, or the presence of insurable interest. --b. All statements made on the insured's behalf, in the absence of fraud, are deemed representations and not warranties. 3. Fraud or material misrepresentation is grounds to cancel a policy. 4. Misrepresentation - No person can make a false or fraudulent statement or representation on an insurance application, or pertaining to one, in order to obtain a fee, commission, money or benefit from an insurer or producer. 5. False, Deceptive or Misleading Statements - No person can make any advertisement or statement by or through any method or medium which contains any assertion, representation or statement which is untrue, deceptive or misleading.

Filing and Approval Forms

1. No basic policy form, or application form, or rider, endorsement or renewal certificate form may be issued until the form has been filed with and approved by the Director. 2. The Director shall approve or disapprove the form within 30 days after the filing. 3. The 30-day period may be extended for an additional period not to exceed 30 days if the Director gives written notice within the first 30-day period to the insurer proposing to deliver the form that the Director needs such additional time for the consideration of such form. 4. This requirement does not apply to: --a. Forms of unique character which are designed for and used with respect to insurance upon a particular risk or subject. --b. Forms issued at the request of a particular life or health insurance policy owner or certificate holder, which relate to the distribution of benefits or to the reservation of rights and benefits of the policy. --c. Forms of group life or health insurance policies, or both, that have been agreed upon as a result of negotiations between the policyholder and the insure. --d. Forms complying with specific requirements regarding policy delivery.

Manner of Giving Cancellation Notice

1. No notice of cancellation is effective unless mailed or delivered to the named insured at least 30 days prior to the cancellation effective date. For nonpayment of premium, the time frame is at least 10 days prior to effective date. The notice must state the reason(s) for cancellation. 2. This section does not apply to nonrenewal.

Unfair Discrimination

1. No person may: --a. Permit individuals of the same class and equal life expectancy to be charged different rates for life insurance or annuities. --b. Permit individuals of the same class and essentially the same hazard to be charged different rates for accident or health insurance. --c. Refuse to insure, or refuse to continue to insure, or limit the amount, extent or kind of coverage available to an individual, or charge an individual a different rate for the same coverage solely because of a physical handicap, or upon attaining/exceeding 65 years of age, unless such action is based on sound actuarial principles or is related to actual or reasonably anticipated experience. • Physical handicaps include blindness, deafness, hearing, speech impairment, and any amount of loss of function to arms or legs --d. Refuse to insure or charge a different rate for life or health insurance to an individual who is, has been, or may be a victim of domestic abuse. Domestic abuse is any occurrence of one or more of the following acts between family or household members: *1) Intentionally or knowingly causing or attempting to cause physical injury; *2) Intentionally or knowingly placing another in fear of imminent serious physical injury; or *3) Committing sexual abuse. 2. In cities of 300,000 or more, no insurer may permit any unfair discrimination between risks of essentially the same degree of hazard in the issuance of burglary and theft or robbery insurance policies or casualty insurance policies which insure against liability to persons arising out of the use or control of real or personal property other than motor vehicles.

Ratemaking Standards

1. Rates may not be excessive, inadequate or unfairly discriminatory. 2. Rate are considered to be excessive if: --a. Such rate is unreasonably high for the insurance provided. --b. A reasonable degree of competition does not exist with respect to the classification to which the rate is applicable. 3. Rates are inadequate if: --a. They are unreasonably low for the insurance provided. --b. The use of such rate endangers the solvency of the insurer. --c. The use of such rate has the effect of destroying competition or creating a monopoly. 4. Rates for each classification of coverage must be based on claims experience of the insurers within Oregon. Rates are intended to encourage and be the result of competition among insurers on a sound financial basis.

Unfair Trade Practices

1. Rebating -a. Offering any rebate of premiums payable, any special favor in dividends or other benefits, or any valuable consideration or inducement not specified in the policy. -b. Any applicant or insured who knowingly receives a rebate, upon conviction, is guilty of a misdemeanor punishable by a fine of up to $1,000. 2. Misrepresentations - Making, issuing, or circulating any statement that misrepresents the benefits, advantages, conditions, or terms of any insurance policy. 3. False Advertising - Publishing or disseminating in any fashion, or through any media, any untrue, deceptive, or misleading statement about the business of insurance or, with respect to any person, in the conduct of such person's insurance business. 4. Unfair Discrimination -a. Permitting individuals of the same class and equal life expectancy to be charged different rates for life insurance or annuities. -b. Permitting individuals of the same class and essentially the same hazard to be charged different rates for accident or health insurance. -c. Basing eligibility for insurance on the applicant's age, sex, race, creed, national origin, or marital status. -d. Refusing to insure or charging a different rate for life or health insurance to an individual who is, has been, or may be a victim of, domestic abuse. -e. Physical Disability - Refusing to insure, or refusing to continue to insure, or limiting the amount, extent or kind of coverage available to an individual, or charging an individual a different rate for the same coverage solely because of a physical disability, including blindness, except where based on sound actuarial principles or actual or reasonably anticipated experience. 5. Illegal Inducement - No person shall permit, offer to make, or make any contract or agreement of insurance unless all terms, conditions, benefits or understandings by way of inducement are plainly expressed in the policy, contract or agreement.

Maintaining a License: (Reinstatement)

1. The Director may modify the suspension of a license, a category of insurance business or a class of insurance and reinstate the license, category or class. 2. The Director of the Department of Consumer and Business Services may reinstate a revoked license, any revoked category of insurance business or any revoked class of insurance. 3. An individual insurance producer who allows his / her license to lapse may apply to the Director to reinstate the same license within 12 months from the due date for renewal without having to take and pass a written examination. However, the insurance producer must: -a. Pay a reinstatement fee that is double the normal renewal fee. -b. Complete any continuing education requirements not satisfied to date, including the period for which the license was lapsed.

Oregon Insurance Guaranty Association

1. The Oregon Insurance Guaranty Association provides protection to policyowners and beneficiaries in the event of insurer impairment or insolvency. -a. Impaired Insurer - A member insurer that is not insolvent, but potentially unable to fulfill its obligations. -b. Insolvent Insurer - A member insurer which is placed under an order of liquidation by a court of competent jurisdiction with a finding of insolvency. -c. The Association must notify the Director of any member being financially impaired, and the Director must notify the Association within 3 days after being notified that a member has become insolvent. 2. All insurers authorized to transact property and casualty insurance in Oregon are required to be members of the Association. The Association reimburses members designated as servicing facilities for performing the Association's duties. 3. If a member insurer becomes impaired or insolvent, an assessment will be made against the other members to provide money for the claims of the insolvent insurer. 4. The maximum amount the Association will pay for a covered claim (excluding Workers' Compensation insurance) is $300,000 per covered claim. **Note: Association coverage does not apply to any claimant whose net worth exceeds $25,000,000. 5. Coverage from a solvent insurer must pay first, with any guaranty association's coverage being secondary. If two or more guaranty associations are liable, the association in the insured's state of residence pays first, with the following exceptions: -a. For Workers' Compensation claims, the association in the claimant's state of residence pays first. -b. For claims to damaged property at a permanent location, the association of the state in which the property is located pays first.

Privacy of Consumer Information

1. When a consumer becomes a licensee's customer or before a licensee discloses a consumer's personal information, the licensee must disclose how it receives, manages, and discloses personal information. 2. The privacy notice must be provided in writing annually as long as the consumer-licensee relationship continues. The notice may be delivered by email if the recipient agrees. 3. The notice must state: -a. The categories of information collected. -b. The categories disclosed; whether they are disclosed to affiliated or unaffiliated parties, or both; and whether the licensee is affiliated with the recipient. -c. The individual's right to authorize disclosure or opt out of disclosure. -d. How the licensee protects the information's confidentiality and security. -e. Any other information required by law. 4. If the licensee is an insurer who assumes responsibility for meeting legal requirements concerning privacy notices, the producer, if any, may not also be required to do so. 5. A licensee providing notice to a group life policy's holder and who does not disclose an insured's information to a nonaffiliated third party need not provide this notice to each insured.

Notifying Insured of Insurance Pool Eligibility

1. When automobile bodily injury and property damage liability coverage is canceled for other than nonpayment of premium, or for reasons stated the Policy Renewal/Refusal to Renew section above, the insurer shall notify the named insured of possible eligibility for automobile liability insurance through any insurance pool operating in Oregon. 2. Such notice shall be included in the notice of cancellation or the notice of intent not to renew.

Suits Against Insurers

A fire insurance policy shall contain a provision stating that no suit or action on the policy for the recovery of any claim shall be sustainable in any court of law or equity unless: 1. All the requirements of this policy shall have been complied with. 2. The suit has been filed within 24 months after the loss occurred.

Adjuster

A person licensed to adjust property and casualty insurance, health insurance, or any class of insurance designated by the Director.

Nonresident Producer

A person living in another state may obtain a producer license if he/she applies and pays the fees for the license and holds the same license in good standing in his/her home state, which grants nonresident producer licenses to Oregon residents on the same basis. Notes: The NAIC's Producer Database allows the Director to confirm that a license held in another state is in good standing. A title insurance producer may not obtain a nonresident producer license from Oregon. b. Any producer who moves from Oregon to another state must notify the Director of the change in address within 30 days after the change. c. A person holding a nonresident producer license is deemed to have appointed the Director to receive service of due legal process against the producer on the producer's behalf.

Limited Class Credit Insurance Producer

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. Limited class credit insurance includes, but is not limited to: a. Credit. b. Mortgage. c. Automobile dealer guaranteed automobile protection. d. Any other form of insurance designated by the Director as a form of limited class insurance.

Insurance Consultant

A person who claims to be a consultant or who, for compensation, offers or provides insurance information, unless the person does so under another license or profession or does so only for an insurance producer or authorized insurer. Note: A consultant may be licensed in life, health, property and casualty, or any class designated by the Director and must maintain $500,000 of errors and omissions insurance.

Maintaining A License: (Assumed Business Name)

A producer must notify the Director prior to transacting business under any name other than the producer's legal name and prior to changing, deleting or adding an assumed business name in connection with the insurance producer's business under the producer license. An adjuster or insurance consultant must notify the Director within 30 days of the change in, deletion or addition of an assumed business name under which such a licensee transacts business.

Examination of Records

A resident and nonresident insurance producer must keep at the principal place of business the usual and customary records pertaining to the business under the producer license. All records must be kept available and open to the inspection of the Director during business hours. Records of insurance transacted by the producer must be kept for 3 years following the expiration of the policy.

Civil Penalties

Any person who violates any provision of the Insurance Code, any lawful rule or final order of the Director of the Department of Consumer and Business Services, or any judgment made by any court upon application of the Director, must: 1. Pay a civil penalty of up to $10,000 for each offense. In the case of individual producers, adjusters or insurance consultants, the civil penalty is not more than $1,000 for each offense. Each violation is deemed a separate offense. 2. Pay a civil penalty in an amount determined by the Director, but not to exceed the amount by which the person profited in any transaction, which violates any such provision, rule, order or judgment.

Disciplinary Actions: (Cease and Desist Orders)

If the Director determines that a person has engaged in an unfair method of competition, or an unfair or deceptive act or practice, the Director issues an order requiring the person to cease and desist from engaging in the method of competition, act or practice. 2. The copy of the order sets forth a statement of the specific charges and the fact that the person may request a hearing within 20 days of the date of mailing. 3. When a hearing is requested, the Director sets a date for the hearing to be held within 30 days after receipt of the request, and gives the person involved advance written notice of at least seven days. 4. The person requesting the hearing must satisfy the Director that the order should not be complied with. 5. The order becomes final 20 days after the date of mailing unless, within a 20-day period, the person to whom it is directed files a written request for a hearing. 6. No order of the Director or order of a court to enforce the order in any way relieves or absolves any person affected by the order from any liability under any other laws of this state.

License Probation, Suspension, Revocation, or Refusal to Issue or Renew

In addition to any other actions, the Director may place a licensee on probation, or suspend, revoke, refuse to issue or renew a producer license if the licensee did any one or more of the following: 1. Provided incorrect, incomplete, or materially untrue information in the license application. 2. Violated any insurance law, regulation, subpoena, or order of the Director, or of another state's insurance Director. 3. Obtained the license through fraud or misrepresentation. 4. Improperly withheld, misappropriated, or converted any monies or properties received in the course of doing business. 5. Misrepresented the provisions, terms, and conditions of an insurance policy. 6. Has been convicted of a felony or misdemeanor involving breach of trust. 7. Admitted to or was found to have committed any insurance unfair trade practice. 8. Had an insurance agent license denial, suspension, or revocation in any other state. 9. Forged another person's name in an application or document related to insurance. 10. Improperly used notes or reference material to complete an examination. 11. Knowingly accepts business from a producer who is not licensed. 12. Failed to comply with continuing education requirements.

Unfair Claim Settlement Practices

No insurer or other person shall commit or perform any of the following unfair claim settlement practices: 1. Misrepresenting facts or policy provisions in settling claims. 2. Failing to acknowledge and act promptly upon communications relating to claims. 3. Failing to adopt and implement reasonable standards for the prompt investigation of claims. 4. Refusing to pay claims without conducting a reasonable investigation based on all available information. 5. Failing to affirm or deny coverage of claims within a reasonable time after completed proof of loss statements have been submitted. 6. Not attempting, in good faith, to promptly and equitably settle claims in which liability has become reasonably clear. 7. Compelling claimants to initiate litigation to recover amounts due by offering substantially less than amounts ultimately recovered in actions brought by such claimants. 8. Attempting to settle claims for less than the amount to which a reasonable person would believe a reasonable person was entitled after referring to written or printed advertising material accompanying or made part of an application. 9. Attempting to settle claims on the basis of an application altered without notice to or consent of the applicant. 10. Failing, after payment of a claim, to inform insureds or beneficiaries, upon request by them, of the coverage under which payment has been made. 11. Delaying investigation or payment of claims by requiring a claimant or the physician of the claimant to submit a preliminary claim report and then requiring subsequent submission of loss forms when both require essentially the same information. 12. Failing to promptly settle claims under one coverage of a policy where liability has become reasonably clear in order to influence settlements under other coverages of the policy. 13. Failing to promptly provide the proper explanation of the basis relied on in the insurance policy in relation to the facts or applicable law for the denial of a claim. 14. No insurer shall refuse, without just cause, to pay or settle claims arising under coverages provided by its policies with such frequency as to indicate a general business practice, as evidenced by: -a. A substantial increase in the number of complaints against the insurer received by the Department of Consumer and Business Services. -b. A substantial increase in the number of lawsuits filed against the insurer or its insureds by claimants. -c. Other relevant evidence.

Selected Homeowners Policy Endorsements

Special Provisions - Oregon (HO 01 36) 1. Amends definition of "named insured" to include the insured's spouse or domestic partner. 2. Limit of $2,500 on property used primarily for business purposes other than as a home day care business. 3. Limit of $1,500 on property away from the residence premises used primarily for business purposes. 4. Excludes business data and property used primarily for home day care business. 5. Proof of loss must be submitted within 90 days of the insurer's request. 6. The insurer and insured will each choose, pay for and bear the expenses of an appraiser. 7. Decision agreed to by each party will set the amount of loss. 8. Interest in the policy may be cancelled by giving 10 days' notification of cancellation to a designated mortgagee. 9. Insurer cannot cancel or decide not to renew policy solely because the home day care business is operated on the residence premises. 10. Amends conditions relating to concealment or fraud. ----------------------------- Permitted Incidental Occupancies-Residence Premises - Oregon (HO 05 42) 1. This endorsement covers a structure of the residence premises for direct physical loss by an insured peril for a specified limit of insurance when used for conducting a business. 2. This endorsement also allows the Coverage C, Personal Property special limit of $2,500 to apply to the described business. ------------------------------ Home Day Care - Oregon (HO 05 97) 1. Property and Liability coverage becomes available for a home day care business. 2. Personal property of a home day care business becomes insured under Coverage C (Personal Property). 3. Limit of $1,500 on property away from the residence premises used primarily for business purposes.

Temporary License

The Director may issue a temporary producer license for up to 180 days without requiring a written exam if the Director determines the license is necessary to service an insurance business in the following cases: a. To the surviving spouse or court-appointed representative of a producer who dies or becomes disabled. b. To the member or employee of a business entity that is a producer, when the entity's designated individual dies or becomes disabled. c. To the designee of a producer entering active service in the U.S. armed forces. d. When the Director determines that issuing a temporary license is in the public's interest. Note: The Director may place additional conditions upon the license as appropriate to protect the public's interest.

Maintaining A License: (Notice of Change of Address or Telephone Number)

The Director must be notified within 30 days of the following changes: 1. A change of address or telephone number of the principal place of business or any location in this state at which a producer, adjuster, or insurance consultant transacts business under the license. 2. The opening or closing of a location in this state at which a producer, adjuster, or insurance consultant transacts business under the license. 3. A change of residence for resident producers, adjusters or insurance consultants. 4. The commencement or termination of the authority given to an individual insurance producer to act on behalf of a business entity.

Grounds for Policy Form Disapproval

The Director will not approve any form if he/she finds: 1. It does not comply with the law; 2. Any portion of it to be unintelligible, uncertain, ambiguous or abstruse, or likely to mislead a person to whom the policy is offered, delivered or issued; 3. Its use would be prejudicial to the policyholders' interests; 4. It contains provisions which are unjust, unfair or inequitable; 5. The form is using disapproved sales presentation material; or 6. The benefits provided are not reasonable in relation to the premium charged.

Controlled Business

This practice is defined as using a license chiefly to procure insurance on the life or property of one's own self, one's spouse, or one's employees or employer. 1. An agent is deemed to be writing controlled business if the premiums payable in any calendar year exceed the premiums, or twice the premiums in the case of life and health, on all other insurance transacted. 2. The receipt of commissions on controlled business is an unlawful rebate. 3. A person may not injure the public by deterring free competition, which includes: -a. Controlling premium amounts or producer compensation amounts. -b. Discriminating against any insurer, manager, or agent based on how business is transacted or based on the insurer, manager, or agent's affiliation with an insurer, manager, agent, or representative.

Misrepresentation and Other Prohibited Claim Practices

An insurer may not: 1. Fail to fully disclose to a first party claimant all pertinent benefits, coverages and other provisions of an insurance policy under which the claim is filed. 2. Conceal from a first party claimant any insurance policy benefits, coverages or other provisions that are pertinent to the claim. 3. Deny a claim on the grounds of the claimant's failure to exhibit the relevant property without proof of the insurer's demand and the claimant's refusal. 4. Make statements that require a claimant to give written notice of loss or proof of loss within a specified time and that seek to relieve the insurer of its obligations if the time limit is not complied with, unless the failure to comply with the specified time limit prejudices the insurer's rights. 5. Request a first party claimant to sign a release that extends beyond the subject matter that gave rise to the claim payment. 6. Issue checks or drafts in partial settlement of a loss or claim under a specific policy coverage that contain language releasing the insurer or its insured from its total liability.

Selected Dwelling Policy Endorsements

Special Provisions - Oregon (DP 01 36) 1. Amends definition of "named insured" to include the insured's spouse or domestic partner. 2. Amends conditions relating to concealment or fraud. 3. Proof of loss must be submitted within 90 days of the insurer's request. 4. The insurer and insured will each choose, pay for and bear the expenses of an appraiser. 5. Decision agreed to by each party will set the amount of loss. 6. Interest in the policy may be cancelled by giving 10 days' notification of cancellation to a designated mortgagee. 7. Insurer cannot cancel or decide not to renew policy solely because the home day care business is operated on the described location.