USA Statutes : oregon
Title : TITLE 56 INSURANCE
Chapter : Chapter 746 Trade Practices
Nothing in this
chapter shall apply to wet marine and transportation insurance or
prohibit any of the following practices:

(1) In the case of life insurance policies, paying bonuses to
policyholders or otherwise abating their premiums in whole or in part out
of surplus accumulated from nonparticipating insurance, provided that any
such bonuses or abatement of premiums shall be fair and equitable to
policyholders and for the best interests of the insurer and its
policyholders;

(2) In the case of industrial life insurance policies, making
allowance to policyholders who have continuously for a specified period
made premium payments directly to an office of the insurer, in an amount
which fairly represents the saving in collection expense;

(3) Readjustment of the rate of premium for a group life or health
insurance policy based on the loss or expense experience thereunder, at
the end of the first or any subsequent policy year, which may be made
retroactive only for such policy year;

(4) Extension of credit for payment of premiums without any service
charge or interest by the insurer or insurance producer for a period of
not more than 90 days after the end of the month in which the policy
becomes effective;

(5) Practices authorized pursuant to ORS 733.220 and 733.230;

(6) The issuing of life or health insurance policies on a salary
savings, bank draft, preauthorized check or payroll deduction plan or
similar plan at a reduced rate reasonably related to the savings made by
use of such plan; or

(7) The issuing of life or health insurance policies at rates less
than the usual premium rates for such policies, or using modifications of
premium rates based on amount of insurance, if such issuance or
modification does not result in reduction in premium rates in excess of
savings in administration and issuance expenses reasonably attributable
to such policies. [Formerly 736.825; 1983 c.740 §254; 2003 c.364 §133] (1) No person shall
make or permit any unfair discrimination between individuals of the same
class and equal expectation of life, or between risks of essentially the
same degree of hazard, in the availability of insurance, in the
application of rates for insurance, in the dividends or other benefits
payable under insurance policies, or in any other terms or conditions of
insurance policies.

(2) Discrimination by an insurer in the application of its
underwriting standards or rates based solely on an individual’s physical
handicap is prohibited, unless such action is based on sound actuarial
principles or is related to actual or reasonably anticipated experience.
For purposes of this subsection, “physical handicap” shall include, but
not be limited to, blindness, deafness, hearing or speaking impairment or
loss, or partial loss, of function of one or more of the upper or lower
extremities.

(3) Discrimination by an insurer in the application of its
underwriting standards or rates based solely upon an insured’s or
applicant’s attaining or exceeding 65 years of age is prohibited, unless
such discrimination is clearly based on sound actuarial principles or is
related to actual or reasonably anticipated experience.

(4)(a) No insurer, on the basis of the status of an insured or
prospective insured as a victim of domestic violence, shall do any of the
following:

(A) Deny, cancel or refuse to issue or renew an insurance policy;

(B) Demand or require a greater premium or payment;

(C) Designate domestic violence as a preexisting condition for
which coverage will be denied or reduced;

(D) Exclude or limit coverage for losses or deny a claim; or

(E) Fix any lower rate for or discriminate in the fees or
commissions of an insurance producer for writing or renewing a policy.

(b) The fact that an insured or prospective insured is or has been
a victim of domestic violence shall not be considered a permitted
underwriting or rating criterion.

(c) Nothing in this subsection prohibits an insurer from taking an
action described in paragraph (a) of this subsection if the action is
otherwise permissible by law and is taken in the same manner and to the
same extent with respect to all insureds and prospective insureds without
regard to whether the insured or prospective insured is a victim of
domestic violence.

(d) An insurer that complies in good faith with the requirements of
this subsection shall not be subject to civil liability due to such
compliance.

(e) For purposes of this subsection, “domestic violence” means the
occurrence of one or more of the following acts between family or
household members:

(A) Attempting to cause or intentionally or knowingly causing
physical injury;

(B) Intentionally or knowingly placing another in fear of imminent
serious physical injury; or

(C) Committing sexual abuse in any degree as defined in ORS
163.415, 163.425 and 163.427.

(5) If the Director of the Department of Consumer and Business
Services has reason to believe that an insurer in the application of its
underwriting standards or rates is not complying with the requirements of
this section, the director shall, unless the director has reason to
believe the noncompliance is willful, give notice in writing to the
insurer stating in what manner such noncompliance is alleged to exist and
specifying a reasonable time, not less than 10 days after the date of
mailing, in which the noncompliance may be corrected.

(6)(a) If the director has reason to believe that noncompliance by
an insurer with the requirements of this section is willful, or if,
within the period prescribed by the director in the notice required by
subsection (5) of this section, the insurer does not make the changes
necessary to correct the noncompliance specified by the director or
establish to the satisfaction of the director that such specified
noncompliance does not exist, the director may hold a hearing in
connection therewith. Not less than 10 days before the date of such
hearing the director shall mail to the insurer written notice of the
hearing, specifying the matters to be considered.

(b) If, after the hearing, the director finds that the insurer’s
application of its underwriting standards or rates violates the
requirements of this section, the director may issue an order specifying
in what respects such violation exists and stating when, within a
reasonable period of time, further such application shall be prohibited.
If the director finds that the violation was willful, the director may
suspend or revoke the certificate of authority of the insurer.

(7) Affiliated workers’ compensation insurers having reinsurance
agreements which result in one carrier ceding 80 percent or more of its
workers’ compensation premium to the other, while utilizing different
workers’ compensation rate levels without objective evidence to support
such differences, shall be presumed to be engaging in unfair
discrimination. [1967 c.359 §568; 1977 c.331 §1; 1979 c.140 §1; 1987
c.676 §2; 1987 c.884 §53; 1997 c.564 §1; 1999 c.59 §229; 2003 c.364 §134](1) In cities of 300,000 or more, and
except as provided in subsection (3) of this section, no insurer shall
make or 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.

(2) Property insured or persons insured against liability arising
out of use or control of real or personal property other than motor
vehicles, if comparable in other respects in exposures to the peril
insured against, shall not be deemed to be of different hazard solely
because of the geographic location of the property or the place of
residence or business of the person to be insured.

(3) Notwithstanding subsection (1) of this section an insurer may
make or permit discrimination between risks of essentially the same
degree of hazard in the issuance of insurance policies described in
subsection (1) of this section if the insurer, at the time of the
discrimination, insures a percentage of the similar risks at least equal
to the ratio that its premiums for the respective line of business as
reported in the annual statement required by ORS 731.574 for the second
preceding calendar year bears to the total premium for the same line of
business as reported by all insurers in the annual statements required by
ORS 731.574 for the second preceding calendar year, within a square one
mile on each side centered upon the location of the property, insurance
in regard to which the insurer declines to issue. [1971 c.522 §2; 1973
c.9 §1]
No person shall sell, agree or offer to sell, or give or offer to give,
directly or indirectly in any manner whatsoever, shares of stock,
securities, bonds, special or advisory board contracts or agreements of
any form or nature promising returns and profits as an inducement to
insurance. No insurer engaging in or permitting its representatives to
engage in such practices in this or any other state may be authorized to
do business in this state. [Formerly 739.535] Except as otherwise
expressly provided by the Insurance Code, no person shall permit, offer
to make or make any contract of insurance, or agreement as to such
contract, unless all agreements or understandings by way of inducement
are plainly expressed in the policy issued thereon. [1967 c.359 §570] No person shall personally or otherwise offer,
promise, allow, give, set off, pay or receive, directly or indirectly,
any rebate of or rebate of part of the premium payable on an insurance
policy or the insurance producer’s commission thereon, or earnings,
profit, dividends or other benefit founded, arising, accruing or to
accrue on or from the policy, or any other valuable consideration or
inducement to or for insurance on any domestic risk, which is not
specified in the policy. [1967 c.359 §571; 2003 c.364 §135] With
respect to title insurance, no commissions, rebates or discounts shall be
paid, allowed or permitted to any person having an interest in or lien
upon real property which is the subject of the title insurance involved,
or to any person acting for or on behalf of a person with such an
interest or lien. [Formerly 748.086] (1) As used in this
section, “personal or controlled insurance” means insurance covering an
insurance producer or:

(a) The spouse of the insurance producer, the employer of the
insurance producer or the employer’s spouse, or any group of employees
under a group policy issued to the employer of the insurance producer;

(b) Any person related to the insurance producer, to the spouse of
the insurance producer, to the employer of the insurance producer or to
the employer’s spouse within the second degree by blood or marriage;

(c) If the employer of the insurance producer is a corporation, any
person directly or indirectly owning or controlling a majority of the
voting stock or controlling interest in such corporation;

(d) If the employer of the insurance producer is a partnership or
association, any person owning any interest in such partnership or
association;

(e) If the insurance producer is a corporation, any person directly
or indirectly owning or controlling a majority of the voting stock or
controlling interest in the insurance producer, and any corporation which
is likewise directly or indirectly controlled by the person who so
directly or indirectly controls the insurance producer; or

(f) If the insurance producer is a corporation, any corporation
making consolidated returns for United States income tax purposes with
any corporation described in paragraph (e) of this subsection.

(2) If premiums on personal or controlled insurance transacted by
an insurance producer payable in one calendar year exceed the premiums or
with respect to life and health insurance twice the premiums, on other
insurance transacted by the insurance producer payable in the same year,
the receipt of commissions upon the excess is an unlawful rebate.

(3) This section shall not apply to an individual licensee who:

(a) Is licensed during all of such calendar year individually as an
insurance producer;

(b) During such calendar year conducts an individual insurance
producer business, not being designated to exercise the powers conferred
by an insurance producer’s license issued to any firm or corporation nor
owning any interest in any firm or corporation transacting an insurance
producer business;

(c) Has been continuously licensed in some manner as an insurance
producer, and has been active as such, for at least 25 years; and

(d) Is at least 65 years of age at the beginning of such calendar
year.

(4) This section does not apply to the writing, issuing or
soliciting by a seller of personal property of insurance covering the
personal property sold by the seller on an installment contract
whereunder the title to the property is reserved by the seller.

(5) This section shall not apply to an insurance producer, whether
an individual, firm or corporation, if:

(a) The insurance producer is controlled or owned by a nonprofit
professional association and offers professional liability and related
business and personal umbrella or excess liability insurance exclusively
to members of the association; and

(b) The primary function of the association is other than marketing
insurance. [1967 c.359 §573; 1987 c.774 §147; 1989 c.701 §73; 2003 c.364
§136] (1) A person may not engage,
directly or indirectly, in any action described in subsection (2) of this
section in connection with:

(a) The offer or sale of any insurance; or

(b) Any inducement or attempted inducement of any insured or person
with ownership rights under an issued life insurance policy to lapse,
forfeit, surrender, assign, effect a loan against, retain, exchange or
convert the policy.

(2) Subsection (1) of this section applies to the following actions:

(a) Making, issuing, circulating or causing to be made, issued or
circulated, any estimate, illustration, circular or statement
misrepresenting the terms of any policy issued or to be issued or the
benefits or advantages therein or the dividends or share of surplus to be
received thereon;

(b) Making any false or misleading representation as to the
dividends or share of surplus previously paid on similar policies;

(c) Making any false or misleading representation as to the
financial condition of any insurer, or as to the legal reserve system
upon which any life insurer operates;

(d) Using any name or title of any policy or class of policies
misrepresenting the true nature thereof;

(e) Employing any device, scheme or artifice to defraud;

(f) Obtaining money or property by means of any untrue statement of
a material fact or any omission to state a material fact necessary in
order to make the statement, in light of the circumstances under which it
was made, not misleading;

(g) Engaging in any other transaction, practice or course of
business that operates as a fraud or deceit upon the purchaser, insured
or person with policy ownership rights; or

(h) Materially misrepresenting the provider network of an insurer
offering managed health insurance or preferred provider organization
insurance as defined in ORS 743.801, including its composition and the
availability of its providers to enrollees in the plan. [1967 c.359 §574;
2001 c.266 §7]In addition to all other powers of the
Director of the Department of Consumer and Business Services with respect
thereto, the director may issue rules:

(1) Requiring persons who replace, or offer or propose to replace,
existing life insurance, to leave with the policyholder written, signed
and dated statements which fully and correctly compare the terms,
conditions and benefits of an existing policy with the proposed policy;
and

(2) Limiting the commission or compensation payable to an insurance
producer on account of a life insurance policy that provides a
nonforfeiture value sold to replace an existing life insurance policy
that provides a nonforfeiture value to the commission or compensation the
insurance producer would have received if both the replaced and the
replacement insurance policies had been carried by the insurer which
issues the replacement policy. [1967 c.359 §575; 1971 c.231 §35; 2003
c.364 §137]No person shall make a false or fraudulent statement or
representation on or relative to an application for insurance, or for the
purpose of obtaining a fee, commission, money or benefit from an insurer
or insurance producer. [Formerly 736.460; 2003 c.364 §138] No person shall
make, publish, disseminate, circulate, or place before the public, or
cause, directly or indirectly, to be made, published, disseminated,
circulated, or placed before the public, in a newspaper, magazine or
other publication, or in the form of a notice, circular, pamphlet, letter
or poster, or over any radio or television station, or in any other way,
an advertisement, announcement or statement containing any assertion,
representation or statement with respect to the business of insurance or
with respect to any person in the conduct of the insurance business,
which is untrue, deceptive or misleading. [Formerly 736.608] (1) An
insurer or licensee who advertises in a language other than English is
not required to provide an insurance policy in any language other than
English so long as the advertisement states clearly that the policy that
is purchased is available only in English.

(2) Advertisements regarding an insurance policy in languages other
than English may not be construed to modify the policy in the event of a
dispute over the provisions of the policy. [1997 c.809 §2; 2003 c.249 §1]Note: 746.115 was added to and made a part of ORS chapter 746 by
legislative action but was not added to any smaller series therein. See
Preface to Oregon Revised Statutes for further explanation. No person shall willfully
collect any sum as premium or charge for insurance which is not then
provided, or is not in due course to be provided subject to acceptance of
the risk by the insurer, under an insurance policy issued by an insurer
in conformity to the Insurance Code. [1967 c.359 §579] (1) As used in
this section:

(a) “Health care service contractor” has the meaning given that
term in ORS 750.005.

(b) “Independent practice association” has the meaning given that
term in ORS 743.801.

(2) An insurer or a health care service contractor that has a
contract with an independent practice association to provide eye care
services may not limit coverage of eye care services only to services
provided by a physician if the eye care services are covered services and
are within the lawful scope of practice of a licensed optometrist. [2005
c.442 §2]Note: 746.125 was added to and made a part of ORS chapter 746 by
legislative action but was not added to any smaller series therein. See
Preface to Oregon Revised Statutes for further explanation.(1) No insurer shall participate in any
plan to offer or effect in this state, as an inducement to the purchase
or rental by the public of any property or services, any insurance for
which there is no separate charge to the insured. No person shall arrange
the sale of any such insurance.

(2) Subsection (1) of this section does not apply to:

(a) Home protection insurance or other insurance offered as a
guarantee of the performance of property and designed to protect the
purchasers or users of such property;

(b) Title insurance; or

(c) Credit life or credit health insurance as defined in ORS
743.371.

(3) The charge for any insurance incidental to the purchase or
rental by the public of any property or services shall be in accordance
with rates on file with the Director of the Department of Consumer and
Business Services. [1967 c.359 §580; 1969 c.336 §16; 1981 c.247 §20; 1993
c.265 §9] (1) If a person asks
an applicant for insurance to take a genetic test in connection with an
application for insurance, the use of the test shall be revealed to the
applicant and the person shall obtain the specific authorization of the
applicant using a form adopted by the Director of the Department of
Consumer and Business Services by rule.

(2) A person may not use favorable genetic information to induce
the purchase of insurance.

(3) A person may not use genetic information to reject, deny,
limit, cancel, refuse to renew, increase the rates of, affect the terms
and conditions of or otherwise affect any policy for hospital or medical
expenses.

(4) A person may not use genetic information about a blood relative
to reject, deny, limit, cancel, refuse to renew, increase the rates of,
affect the terms and conditions of or otherwise affect any policy of
insurance.

(5) For purposes of this section, “blood relative,” “genetic
information” and “genetic test” have the meanings given those terms in
ORS 192.531. [1995 c.680 §8; 2001 c.588 §17](1) Every insurer or insurance producer
soliciting an offer to buy or selling life insurance in correlation with
the sale of securities shall furnish the prospect with a clear and
unambiguous written proposal prior to the signing of the application by
the applicant.

(2) The written proposal shall be dated and signed by the insurance
producer, or by the insurer if no insurance producer is involved, and
left with the prospect. The written proposal shall be on a form which has
been filed with the Director of the Department of Consumer and Business
Services. If a sale is made of both life insurance and securities, a
duplicate copy of the written proposal left with the buyer shall be
retained by the insurer for a period of not less than three years.

(3) Each such proposal shall:

(a) State the name of the insurer in which the life insurance is to
be written;

(b) State that the prospect has the right to purchase the life
insurance only, the securities only or both the life insurance and the
securities;

(c) Contain no misrepresentations or false, deceptive or misleading
words, figures or statements;

(d) State all material facts without which the proposal would have
the capacity or tendency to mislead or deceive; and

(e) Set forth all matters pertaining to life insurance, including
premium charges, separately from matters not pertaining to life insurance.

(4) This section shall not be construed to affect the application
of any other provision of law concerning or regulating securities.
[Formerly 739.562; 2003 c.364 §139](1) Notwithstanding ORS 737.600, but
subject to all other rate filing requirements of ORS chapter 737, an
insurer may combine for dividend purposes the experience of a group of
employers covered for workers’ compensation insurance by the insurer,
subject to applicable rules adopted by the Director of the Department of
Consumer and Business Services, if:

(a) All the employers in the group are members of an organization.

(b) The employers in the group constitute at least 50 percent of
the employers in the organization, unless the number of covered workers
in the group exceeds 500, in which case the employers in the group must
constitute at least 25 percent of the employers in the organization.

(c) The grouping of employers is likely to substantially improve
accident prevention, claims handling for the employers and reduce
expenses.

(2) This section does not apply to an organization of employers for
which organization a workers’ compensation policy was lawfully issued
before October 4, 1977. The guaranty contract required by ORS 656.419
shall contain for each employer covered thereby the information required
by ORS 656.419 (2). When an employer becomes an insured member of the
organization the insurer shall, within 30 days after the date insured
membership commenced, file a notice thereof with the director. [1977
c.405 §3; 1983 c.706 §3; 1990 c.1 §5; 2003 c.170 §11] An
insurer or insurance producer offering workers’ compensation insurance in
Oregon shall not quote projected net insurance premiums based upon
figures that are discretionary or terms that are not guaranteed in the
workers’ compensation insurance policy. [1999 c.868 §3; 2003 c.364 §140]Note: 746.147 was added to and made a part of ORS chapter 746 by
legislative action but was not added to any smaller series therein. See
Preface to Oregon Revised Statutes for further explanation.(1) For property, inland
marine, casualty or surety insurance, an insurer may combine for dividend
purposes the experience of a group of persons or risks any of which are
within this state, except for workers’ compensation insurance done in
compliance with ORS 746.145 and subject to rules adopted by the Director
of the Department of Consumer and Business Services.

(2) The director shall make reasonable rules regarding such
dividend groupings as an aid to the effectuation and enforcement of the
Insurance Code. Such rules shall have as their purpose the prevention of
misrepresentation, unfair discrimination and other unfair trade
practices, and may among other things require that:

(a) Such a grouping comprises substantially homogeneous risks.

(b) The organization under the auspices of which such a grouping is
made has been in existence for at least two years and was formed for
purposes other than that of obtaining insurance.

(c) A substantial improvement in loss prevention or claims handling
will be a likely result of such a grouping.

(d) Information regarding eligibility for participation in the
grouping and the system for allocation of dividends among the
participants be filed with the director.

(3) An insurer shall not unfairly discriminate in the allocation of
dividends among the participants in such a dividend grouping.

(4) The system for allocation of dividends among the participants
may provide for allocation at a fixed percentage of premiums, or may
provide for variations in the percentage of premiums paid as dividends,
or may provide for other variations in determining the amounts of
dividends allocated to participants. The variations may be based on loss
or expense factors or on other reasonable considerations, such as risk
size, risk location or industry or trade hazard classification, that have
a probable effect on losses or expenses.

(5) Failure to apply in a consistent manner the dividend allocation
system specified in an insurer’s dividend declaration shall be prima
facie evidence of unfair discrimination. [1977 c.405 §4; 1983 c.706 §4;
1999 c.59 §230] Except as
otherwise expressly provided by law, no person, either within or outside
of this state, directly or indirectly, shall enter into any contract,
understanding or combination with any insurer or manager, agent or
representative thereof for the purpose of, nor shall any such persons or
insurers, jointly or severally do any act or engage in any practice for
the purpose of:

(1) Controlling the rates to be charged, or the commissions or
other compensations to be paid, for insuring any risk or class of risks
in this state;

(2) Discriminating against or differentiating from any insurer,
manager or agent, by reason of the plan or method of transacting business
or the affiliation or nonaffiliation with any board or association of
insurers, managers, agents or representatives; or

(3) Doing anything which is detrimental to free competition in the
business or injurious to the insuring public. [Formerly 736.615](1) A depository
institution may not:

(a) Solicit the sale of insurance for the protection of real or
personal property after a person indicates interest in securing a loan or
credit extension, until the depository institution has agreed to make the
loan or credit extension;

(b) Refuse to accept a written binder issued by an insurance
producer as proof that temporary insurance exists covering the real or
personal property that is the subject matter of, or security for, a loan
or extension of credit, and that a policy of insurance will be issued
covering that property. A written binder issued by an insurance producer
or insurer covering real or personal property that is the subject matter
of, or security for, a loan or extension of credit shall be effective
until a policy of insurance is issued in lieu thereof, including within
its terms the identical insurance bound under the binder and the premium
therefor, or until notice of the cancellation of the binder is received
by the borrower and the depository institution extending credit or
offering the loan. When a depository institution closes on a binder under
ORS 742.043, the insurance producer or insurer issuing the binder shall
be bound to provide a policy of insurance, equivalent in coverage to the
coverage set forth in the binder, within 60 days from the date of the
binder. The provisions of this paragraph do not apply when prohibited by
federal or state statute or regulations; or

(c) Use or disclose to any other insurance producer, other than the
original insurance producer, the information relating to a policy of
insurance furnished by a borrower unless the original insurance producer
fails to deliver a policy of insurance within 60 days prior to expiration
to the depository institution without first procuring the written consent
of the borrower.

(2) As used in this section, “depository institution” means a
financial institution as that term is defined in ORS 706.008. [1977 c.742
§4; 1987 c.916 §10; 2003 c.363 §12; 2003 c.364 §144a](1) In a contract or
loan agreement, or in a separate document accompanying the contract or
loan agreement and signed by the mortgagor, borrower or purchaser, that
provides for a loan or other financing secured by the mortgagor’s,
borrower’s or purchaser’s real or personal property and that authorizes
the secured party to place insurance on the property when the mortgagor,
borrower or purchaser fails to maintain the insurance as required by the
contract or loan agreement or the separate document, a warning in
substantially the following form shall be set forth in 10-point type:

___________________________________________________________________________
___

WARNING

Unless you provide us with evidence of the insurance coverage as
required by our contract or loan agreement, we may purchase insurance at
your expense to protect our interest. This insurance may, but need not,
also protect your interest. If the collateral becomes damaged, the
coverage we purchase may not pay any claim you make or any claim made
against you. You may later cancel this coverage by providing evidence
that you have obtained property coverage elsewhere.

You are responsible for the cost of any insurance purchased by us.
The cost of this insurance may be added to your contract or loan balance.
If the cost is added to your contract or loan balance, the interest rate
on the underlying contract or loan will apply to this added amount. The
effective date of coverage may be the date your prior coverage lapsed or
the date you failed to provide proof of coverage.

The coverage we purchase may be considerably more expensive than
insurance you can obtain on your own and may not satisfy any need for
property damage coverage or any mandatory liability insurance
requirements imposed by applicable law.

___________________________________________________________________________
___

(2) Substantial compliance by a secured party with subsection (1)
of this section constitutes a complete defense to any claim arising under
the laws of this state challenging the secured party’s placement of
insurance on the real or personal property in which the secured party has
a security interest, for the protection of the secured party’s interest
in the property.

(3) Nothing contained in this section shall be construed to require
any secured party to place or maintain insurance on real or personal
property in which the secured party has a security interest, and the
secured party shall not be liable to the mortgagor, borrower or purchaser
or to any other party as a result of the failure of the secured party to
place or maintain such insurance.

(4) The failure of a secured party prior to January 1, 1996, to
include in a contract or loan agreement, or in a separate document
accompanying the contract or loan agreement, the notice set forth in
subsection (1) of this section shall not be admissible in any court or
arbitration proceeding or otherwise used to prove that a secured party’s
actions with respect to the placement or maintenance of insurance on real
or personal property in which the secured party has a security interest
are or were unlawful or otherwise improper. A secured party shall not be
liable to the mortgagor, borrower or purchaser or to any other party for
placing such insurance in accordance with the terms of an otherwise legal
contract or loan agreement with the mortgagor, borrower or purchaser
entered into prior to January 1, 1996. [1977 c.742 §5; 1995 c.313 §3;
2003 c.363 §13] As used in ORS
746.213 to 746.219:

(1) “Affiliate” means any company that controls, is controlled by
or is under common control with another company.

(2) “Customer” means an individual who purchases, applies to
purchase or is solicited to purchase insurance products primarily for
personal, family or household purposes.

(3) “Depository institution” means a financial institution as that
term is defined in ORS 706.008. [2003 c.363 §2]Note: 746.213 to 746.219 were added to and made a part of the
Insurance Code by legislative action but were not added to ORS chapter
746 or any series therein. See Preface to Oregon Revised Statutes for
further explanation.(1) A depository institution or an
affiliate of a depository institution that lends money or extends credit
may not:

(a) As a condition precedent to the lending of money or extension
of credit, or any renewal thereof, require that the person to whom the
money or credit is extended, or whose obligation a creditor is to acquire
or finance, negotiate any policy or renewal thereof through a particular
insurer or group of insurers or insurance producer or group of insurance
producers.

(b) Reject an insurance policy solely because the policy has been
issued or underwritten by a person who is not associated with the
depository institution or affiliate when insurance is required in
connection with a loan or the extension of credit.

(c) As a condition for extending credit or offering any product or
service that is equivalent to an extension of credit, require that a
customer obtain insurance from a depository institution or an affiliate
of a depository institution, or from a particular insurer or insurance
producer. This paragraph does not prohibit a depository institution or an
affiliate of a depository institution from informing a customer or
prospective customer that insurance is required in order to obtain a loan
or credit, that loan or credit approval is contingent upon the
procurement by the customer of acceptable insurance or that insurance is
available from the depository institution or an affiliate of the
depository institution.

(d) Unreasonably reject an insurance policy furnished by the
customer or borrower for the protection of the property securing the
credit or loan. A rejection is not considered unreasonable if it is based
on reasonable standards that are uniformly applied and that relate to the
extent of coverage required and to the financial soundness and the
services of an insurer. The standards may not discriminate against any
particular type of insurer or call for rejection of an insurance policy
because the policy contains coverage in addition to that required in the
credit transaction.

(e) Require that any customer, borrower, mortgagor, purchaser,
insurer or insurance producer pay a separate charge in connection with
the handling of any insurance policy required as security for a loan on
real estate, or pay a separate charge to substitute the insurance policy
of one insurer for that of another. A charge prohibited in this paragraph
does not include the interest that may be charged on premium loans or
premium advancements in accordance with the terms of the loan or credit
document. This paragraph does not apply to charges that would be required
when the depository institution or an affiliate of a depository
institution is the licensed insurance producer providing the insurance.

(f) Require any procedures or conditions of an insurer or insurance
producer not customarily required of insurers or insurance producers
affiliated or in any way connected with the depository institution.

(g) Use an advertisement or other insurance promotional material
that would cause a reasonable person to mistakenly believe that the
federal government or the state is responsible for the insurance sales
activity of, or stands behind the credit of, the depository institution
or its affiliate.

(h) Use an advertisement or other insurance promotional material
that would cause a reasonable person to mistakenly believe that the
federal government or the state guarantees any returns on insurance
products or is a source of payment on any insurance obligation of or sold
by the depository institution or its affiliate.

(i) Act as an insurance producer unless properly licensed in
accordance with ORS 744.062, 744.063 or 744.064.

(j) Pay or receive any commission, brokerage fee or other
compensation as an insurance producer, unless the depository institution
or affiliate holds a valid insurance producer license for the applicable
class of insurance. However, an unlicensed depository institution or
affiliate may make a referral to a licensed insurance producer if the
depository institution or affiliate does not negotiate, sell or solicit
insurance. In the case of a referral of a customer, however, the
unlicensed depository institution or affiliate may be compensated for the
referral only if the compensation is a fixed dollar amount for each
referral that does not depend on whether the customer purchases the
insurance product from the licensed insurance producer. Any depository
institution or affiliate that accepts deposits from the public in an area
in which such transactions are routinely conducted in the depository
institution may receive for each customer referral no more than a
one-time, nominal fee of a fixed dollar amount for each referral that
does not depend on whether the referral results in a transaction.

(k) Solicit or sell insurance, other than credit insurance or flood
insurance, unless the solicitation or sale is completed through documents
separate from any credit transactions.

(L) Except as provided in ORS 746.201, include the expense of
insurance premiums, other than credit insurance premiums or flood
insurance premiums, in the primary credit transaction without the express
written consent of the customer.

(m) Solicit or sell insurance unless the insurance sales activities
of the depository institution or affiliate are, to the extent
practicable, physically separated from areas where retail deposits are
routinely accepted by depository institutions.

(n) Solicit or sell insurance unless the depository institution or
affiliate maintains separate and distinct books and records relating to
the insurance transactions, including all files relating to and
reflecting consumer complaints.

(2) A depository institution or an affiliate of a depository
institution that lends money or extends credit and that solicits
insurance primarily for personal, family or household purposes shall
disclose to the customer in writing that the insurance related to the
credit extension may be purchased from an insurer or insurance producer
of the customer’s choice, subject only to the depository institution’s
right to reject a given insurer or insurance producer as provided in
subsection (1)(d) of this section. The disclosure shall inform the
customer that the customer’s choice of insurer or insurance producer will
not affect the credit decision or credit terms in any way, except that
the depository institution may impose reasonable requirements concerning
the creditworthiness of the insurer and the extent of coverage chosen as
provided in subsection (1)(d) of this section. [2003 c.363 §3; 2005 c.22
§497]Note: See note under 746.213. (1) A depository institution that
sells insurance, and any person that sells insurance on behalf of a
depository institution, or on the premises of a depository institution
where the depository institution is engaged in the business of taking
deposits or making loans, shall disclose to the customer in writing, when
practicable and in a clear and conspicuous manner, prior to a sale, that
the insurance:

(a) Is not a deposit;

(b) Is not insured by the Federal Deposit Insurance Corporation or
any other federal government agency;

(c) Is not guaranteed by the depository institution or an affiliate
of the depository institution if applicable, or any person that is
selling insurance if applicable; and

(d) When appropriate, involves investment risk, including the
possible loss of value.

(2) The requirements of subsection (1) of this section apply:

(a) To an affiliate of a depository institution only to the extent
that it sells insurance on the premises of a depository institution where
the depository institution is engaged in the business of taking deposits
or making loans or on behalf of a depository institution.

(b) When an individual purchases insurance primarily for personal,
family or household purposes and only to the extent that the disclosure
would be accurate.

(3) For the purpose of subsection (1) of this section, a person is
selling insurance on behalf of a depository institution, whether on the
premises of the depository institution or at another location, if either
one of the following applies:

(a) The person represents to the customer that the sale of the
insurance is by or on behalf of the depository institution; or

(b) The depository institution refers a customer to the person that
sells insurance and the depository institution has a contractual
arrangement to receive commissions or fees derived from the sale of
insurance resulting from the referral. [2003 c.363 §4]Note: See note under 746.213. (1) The Director of the Department of
Consumer and Business Services may examine and investigate the insurance
activities of any person that the director believes may be in violation
of ORS 746.213, 746.215 or 746.217. Upon request and reasonable notice, a
person shall make its insurance books and records available to the
director and the director’s staff for inspection. An affected person may
submit to the director a complaint or material pertinent to the
enforcement of ORS 746.213, 746.215 and 746.217.

(2) Nothing in ORS 746.213, 746.215 or 746.217 prevents a
depository institution or an affiliate of a depository institution that
lends money or extends credit or other lender or seller from placing
insurance on real or personal property in the event the customer,
borrower, mortgagor or purchaser fails to provide insurance required
under the terms of the loan or credit document.

(3) ORS 746.213, 746.215 and 746.217 do not apply to credit-related
insurance. [2003 c.363 §5]Note: See note under 746.213.When credit life insurance or credit health insurance, as
defined in ORS 743.371, is required as additional security for any
indebtedness, the debtor shall, upon request to the creditor, have the
option of furnishing the required amount of insurance through existing
policies of insurance owned or controlled by the debtor or of procuring
and furnishing the required coverage through any authorized insurer.
[Formerly 739.615]No insurer or licensee under the Insurance Code shall refer an
individual to the Oregon Medical Insurance Pool, established under ORS
735.600 to 735.650, for coverage offered by the pool or arrange for the
individual to apply to the pool for the purpose of separating the
individual from health insurance benefits offered or provided in
connection with a group health benefit plan. [1993 c.130 §5; 1999 c.987
§20] (1) No insurer or other
person shall commit or perform any of the following unfair claim
settlement practices:

(a) Misrepresenting facts or policy provisions in settling claims;

(b) Failing to acknowledge and act promptly upon communications
relating to claims;

(c) Failing to adopt and implement reasonable standards for the
prompt investigation of claims;

(d) Refusing to pay claims without conducting a reasonable
investigation based on all available information;

(e) Failing to affirm or deny coverage of claims within a
reasonable time after completed proof of loss statements have been
submitted;

(f) Not attempting, in good faith, to promptly and equitably settle
claims in which liability has become reasonably clear;

(g) Compelling claimants to initiate litigation to recover amounts
due by offering substantially less than amounts ultimately recovered in
actions brought by such claimants;

(h) 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;

(i) Attempting to settle claims on the basis of an application
altered without notice to or consent of the applicant;

(j) Failing, after payment of a claim, to inform insureds or
beneficiaries, upon request by them, of the coverage under which payment
has been made;

(k) 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;

(L) 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; or

(m) 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.

(2) 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 in this state, which
general business practice is 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; or

(c) Other relevant evidence.

(3)(a) No health maintenance organization, as defined in ORS
750.005, shall unreasonably withhold the granting of participating
provider status from a class of statutorily authorized health care
providers for services rendered within the lawful scope of practice if
the health care providers are licensed as such and reimbursement is for
services mandated by statute.

(b) Any health maintenance organization that fails to comply with
paragraph (a) of this subsection shall be subject to discipline under ORS
746.015.

(c) This subsection does not apply to group practice health
maintenance organizations that are federally qualified pursuant to Title
XIII of the Health Maintenance Organization Act. [1967 c.359 §588a; 1973
c.281 §1; 1989 c.594 §1]
No person shall engage in this state in any trade practice that, although
not expressly defined and prohibited in the Insurance Code, is found by
the Director of the Department of Consumer and Business Services to be an
unfair or deceptive act or practice in the transaction of insurance that
is injurious to the insurance-buying public. [1967 c.359 §589; 1973 c.281
§2](1) Except as provided in subsection (4) of this
section, when an individual applies for a policy or a renewal of a policy
of casualty insurance providing automobile liability coverage, uninsured
motorist coverage, automobile medical payments coverage or automobile
physical damage coverage on an individually owned passenger vehicle
including pickup and panel trucks and station wagons, an insurer shall
not consider either the employment driving record or the nonemployment
driving record of the individual in determining whether the policy will
be issued or renewed or in determining the rates for the policy. An
insurer shall not cancel such policy or discriminate in regard to other
terms or conditions of the policy based upon the employment driving
record or the nonemployment driving record of the individual.

(2) As used in this section, “employment driving record” and
“nonemployment driving record” mean the employment driving record and
nonemployment driving record described in ORS 802.200.

(3) This section is not intended to affect the enforcement of the
motor vehicle laws.

(4) An insurer may use the abstract of the individual’s
nonemployment driving record as authorized under ORS 746.265. [1973 c.113
§2; 1979 c.662 §2; 1983 c.338 §969; 1987 c.5 §6](1) Subject to subsection (2) of this section, when an
individual applies for a policy or a renewal of a policy of casualty
insurance providing automobile liability coverage, uninsured motorist
coverage, automobile medical payments coverage or automobile physical
damage coverage on an individually owned passenger vehicle including
pickup and panel trucks and station wagons, the insurer may consider the
abstract of the nonemployment driving record of the individual under ORS
802.220:

(a) For the purpose of determining whether to issue or renew the
individual’s policy.

(b) For the purpose of determining the rates of the individual’s
policy.

(2) For the purposes specified in subsection (1) of this section,
an insurer issuing or renewing a policy described in subsection (1) of
this section shall not consider any:

(a) Accident or conviction for violation of motor vehicle laws that
occurred more than three years immediately preceding the application for
the policy or renewal of the policy;

(b) Diversion agreements under ORS 813.220 that were entered into
more than three years immediately preceding the application for the
policy or renewal of the policy; or

(c) Suspension of driving privileges pursuant to ORS 809.280 (7) or
(9) if the suspension is based on a nondriving offense.

(3) Subsection (2) of this section does not apply if an insurer
considers the nonemployment driving record of an individual under ORS
802.220 for the purpose of providing a discount to the individual. [1987
c.5 §5; 1989 c.853 §1; 1991 c.860 §7; 1999 c.59 §231; 2001 c.327 §1]No person shall
make or use in the offer or sale of a variable life insurance policy any
illustrations of benefits payable that include projections of past
investment experience into the future or predictions of future investment
experience. This section is not intended to prohibit use of hypothetical
assumed rates of investment return to illustrate possible levels of
benefits. [1973 c.435 §26] As used in ORS
746.275 to 746.300:

(1) “Adjuster” means a person authorized to do business under ORS
744.505 or 744.515.

(2) “Motor vehicle liability insurance policy” means an insurance
policy which provides automobile liability coverage, uninsured motorist
coverage, automobile medical payments coverage or automobile physical
damage coverage on motor vehicles, but does not include any insurance
policy:

(a) Covering garage, automobile sales agency, repair shop, service
station or public parking place operation hazards; or

(b) Issued principally to cover personal or premises liability of
an insured, even though such insurance may also provide some incidental
coverage for liability arising out of the ownership, maintenance or use
of a motor vehicle on the premises of such insured or on the ways
immediately adjoining such premises.

(3) “Motor vehicle body and frame repair shop” means a business or
a division of a business organized for the purpose of effecting repairs
to motor vehicles which have been physically damaged. [1977 c.785 §1]Note: 746.275 to 746.300 and 746.991 were enacted into law by the
Legislative Assembly but were not added to or made a part of ORS chapter
746 or any series therein by legislative action. See Preface to Oregon
Revised Statutes for further explanation.An insurer shall not require that a particular person
make the repairs to the insured’s motor vehicle as a condition for
recovery by the insured under a motor vehicle liability insurance policy.
[1977 c.785 §2]Note: See note under 746.275.A person operating a motor vehicle body and frame repair shop
shall display in a conspicuous place in the shop a sign in bold face type
in letters at least two inches high reading substantially as follows:

___________________________________________________________________________
___

PURSUANT TO OREGON INSURANCE LAW, AN INSURANCE COMPANY MAY NOT
REQUIRE THAT REPAIRS BE MADE TO A MOTOR VEHICLE BY A PARTICULAR PERSON OR
REPAIR SHOP.

___________________________________________________________________________
___ [1977 c.785 §3]Note: See note under 746.275.(1) Without the consent of the owner of the vehicle, an
insurer may not require, directly or indirectly, that a motor vehicle
body and frame repair shop supply or install any aftermarket crash part
unless the part has been certified by an independent test facility to be
at least equivalent to the part being replaced.

(2) For purposes of this section, an aftermarket crash part is at
least equivalent to the part being replaced if the aftermarket crash part
is the same kind of part and is at least the same quality with respect to
fit, finish, function and corrosion resistance. [1987 c.622 §3]Note: See note under 746.275. Any insurer which
offers a motor vehicle insurance policy that provides coverage for repair
of the vehicle shall make available to its insured a crash part warranty
for crash parts not made by the original equipment manufacturer as
described in ORS 746.292 when the insured requests one. [1987 c.622 §4]Note: 746.289 was enacted into law by the Legislative Assembly but
was not added to or made a part of ORS chapter 746, ORS 746.275 to
746.300 or any other series by legislative action. See Preface to Oregon
Revised Statutes for further explanation. (1) An
adjuster establishing loss under a motor vehicle liability insurance
policy shall advise the insured of the provisions of ORS 746.280.

(2) Every motor vehicle liability insurance policy issued in this
state after December 31, 1977, and any extension or renewal after that
date of a policy issued before that date shall be accompanied by a
statement in clear and conspicuous language approved by the director of:

(a) The rights and responsibilities of the insured when a claim is
submitted; and

(b) The provisions of ORS 746.280. [1977 c.785 §4]Note: See note under 746.275.(1) All work done by a motor vehicle
body and frame repair shop shall be recorded on an invoice and shall
describe all service work done and parts supplied. If any used parts are
supplied, the invoice shall clearly state that fact. If any component
system installed is composed of new and used parts, such invoice shall
clearly state that fact. One copy of the invoice shall be given to the
customer and one copy shall be retained by the motor vehicle body and
frame repair shop.

(2) Before commencing repair work and upon the request of any
customer, a motor vehicle body and frame repair shop shall make an
estimate in writing of the parts and labor necessary for the repair work,
and shall not charge for the work done or parts supplied in excess of the
estimate without the consent of such customer.

(3)(a) If crash parts to be used in the repair work are supplied by
the original equipment manufacturer, the parts shall be accompanied by a
warranty that guarantees the customer that the parts meet or exceed
standards used in manufacturing the original equipment.

(b) If crash parts to be used in the repair work are not supplied
by the original equipment manufacturer, the estimate shall include a
statement that says:

___________________________________________________________________________
___

This estimate has been prepared based on the use of a motor vehicle
crash part not made by the original equipment manufacturer. The use of a
motor vehicle crash part not made by the original equipment manufacturer
may invalidate any remaining warranties of the original equipment
manufacturer on that motor vehicle part. The person who prepared this
estimate will provide a copy of the part warranty for crash parts not
made by the original equipment manufacturer for comparison purposes.

___________________________________________________________________________
___

(4) No motor vehicle body and frame shop may:

(a) Supply or install used parts, or any component system composed
of new and used parts, when new parts or component systems are or were to
be supplied or installed.

(b) Supply or install, without the owner’s consent, any aftermarket
crash part unless the part has been certified by an independent test
facility to be at least equivalent to the part being replaced. For
purposes of this paragraph, an aftermarket crash part is at least
equivalent to the part being replaced if the aftermarket crash part is
the same kind of part and is at least the same quality with respect to
fit, finish, function and corrosion resistance.

(c) Charge for repairs not actually performed, or add the cost of
repairs not actually to be performed to any repair estimate.

(d) Refuse any insurer, or its insured, or their agents or
employees, reasonable access to any repair facility for the purpose of
inspecting or reinspecting the damaged vehicle during usual business
hours.

(5) As used in ORS 746.287 and this section, “aftermarket crash
part” means a motor vehicle replacement part, sheet metal or plastic,
that constitutes the visible exterior of the vehicle, including an inner
or outer panel, is generally repaired or replaced as the result of a
collision and is not supplied by the original equipment manufacturer.
[1977 c.785 §5; 1987 c.622 §1]Note: See note under 746.275.Nothing in ORS 746.275 to 746.300 or
746.991 shall prohibit an insurer from establishing proof of loss
requirements for motor vehicle liability insurance policies,
investigating and determining the amount of an insured’s loss through its
agents or employees or negotiating with any person for the repair of such
loss. [1977 c.785 §6]Note: See note under 746.275.An insured whose insurer violates ORS 746.280 or
746.290, or a customer whose motor vehicle body and frame repair shop
violates ORS 746.292, may file an action to recover actual damages or
$100, whichever is greater, for each violation. The court may award
reasonable attorney fees to the prevailing party in an action under this
section. [1977 c.785 §7; 1981 c.897 §102; 1995 c.618 §129]Note: See note under 746.275. The Director of the Department of Consumer and
Business Services may adopt rules to carry out the provisions of ORS
746.275 to 746.300 and 746.991. [1987 c.622 §5]Note: 746.305 was enacted into law by the Legislative Assembly but
was not added to or made a part of ORS chapter 746 or any series therein
by legislative action. See Preface to Oregon Revised Statutes for further
explanation.An insurer that violates ORS 819.014 or
819.018 shall be considered to have violated a provision of the Insurance
Code. [1991 c.820 §7]Note: 746.308 was enacted into law by the Legislative Assembly but
was not added to or made a part of ORS chapter 746 or any series therein
by legislative action. See Preface to Oregon Revised Statutes for further
explanation.UNAUTHORIZED INSURANCE(1) No person shall in this state
directly or indirectly with respect to domestic risks act as insurance
producer for or otherwise transact insurance for any insurer not then
authorized to transact such insurance in this state.

(2) In the event of failure of any unauthorized insurer to pay any
claim or loss within the provisions of such insurance policy, any
insurance producer who assisted or in any manner aided in the procurement
of such insurance policy knowing it to be procured through an
unauthorized insurer shall be liable to the insured for the full amount
of the claim or loss.

(3) This section does not apply to:

(a) Matters authorized to be done by the Director of the Department
of Consumer and Business Services under ORS 746.320 to 746.360.

(b) Insurance written under a surplus line license in compliance
with ORS 735.400 to 735.495.

(c) Any transaction with respect to reinsurance when transacted by
an insurer duly authorized by its state of domicile to transact the class
of insurance involved.

(d) A licensed adjuster or attorney at law representing such an
insurer from time to time in such occupational or professional capacity.
[1967 c.359 §591; 1969 c.336 §17; 1987 c.774 §140; 1991 c.810 §27; 2003
c.364 §145](1) When an unauthorized insurer
does any of the acts specified in subsection (2) of this section in this
state, by mail or otherwise, the doing of such acts shall constitute an
appointment by such insurer of the Director of the Department of Consumer
and Business Services, and the successor in office, as its lawful
attorney upon whom all process may be served in any action begun by or on
behalf of an insured or beneficiary and arising out of policies of
insurance between the insurer and persons residing or authorized to do
business in this state. Subject to subsection (4) of this section, the
doing of any such act shall signify the insurer’s consent that service of
process upon the director is of the same legal force and effect as
personal service of process upon such insurer within this state.

(2) The acts referred to in subsection (1) of this section are:

(a) Issuing or delivering policies of insurance to persons residing
or authorized to do business in this state.

(b) Soliciting applications for policies of insurance from such
persons.

(c) Collecting premiums, membership fees, assessments or other
considerations under policies of insurance from such persons.

(d) Any other transaction of business arising out of policies of
insurance with such persons.

(3) Service of process upon the director shall be made by
delivering to and leaving with the director, or with any clerk on duty in
the office, two copies of such process. Immediately after service of
process, the director shall send one of such copies to the defendant
insurer at its principal office. The director shall keep a record of all
processes served upon the director under this section.

(4) Service of process in the manner provided in this section gives
jurisdiction over the person of an insurer provided:

(a) Notice of such service and a copy of the process are sent by
registered mail or by certified mail with return receipt by the
plaintiff, or the attorney of the plaintiff, to the defendant insurer at
its principal office within 10 days after the date of service; and

(b) The defendant insurer’s receipt, or receipt issued by the post
office with which the letter is registered or certified, showing the name
of the sender of the letter and the name and address of the person to
whom the letter is addressed and an affidavit of the plaintiff, or the
attorney of the plaintiff, showing compliance with this section are filed
with the clerk of the court in which the action against such insurer is
pending on or before the date on which such insurer is required to
appear, or within such further time as the court may allow.

(5) Nothing contained in this section shall limit or abridge the
right to serve any process upon an insurer in any other manner then
permitted by law. [Formerly 736.252; 1991 c.249 §71]Until the expiration of 30 days from the date of filing an
affidavit of compliance under ORS 746.320, no plaintiff or complainant
shall be entitled to a judgment by default in any action in which service
of process is made in the manner provided in such section. [Formerly
736.254](1) Except as provided in subsection
(3) of this section, before any unauthorized insurer may file or cause to
be filed any motion or pleading in an action started against it by
service of process in the manner provided in ORS 746.320, the defendant
insurer shall either:

(a) Procure a certificate of authority to transact insurance in
this state; or

(b) Deposit cash or securities or file a bond with good and
sufficient sureties, approved by the court, with the clerk of the court
in which such action is pending in an amount, fixed by the court,
sufficient to secure the payment of any judgment which may be entered in
such action. However, the court may in its discretion make an order
dispensing with such deposit or bond where the insurer makes a showing
satisfactory to such court that the insurer maintains in a state of the
United States funds or securities, in trust or otherwise, sufficient and
available to satisfy any final judgment which may be entered in such
action.

(2) The court may order such postponement as may be necessary to
give such insurer reasonable opportunity to comply with subsection (1) of
this section and to prepare its defense in such action.

(3) Nothing in ORS 746.320 to 746.360 shall be construed to prevent
a defendant unauthorized insurer from filing a motion to set aside
service of process made in the manner provided in ORS 746.320 on the
ground that such insurer has not done any of the acts described in
subsection (2) of such section. [Formerly 736.256] In any action
against an unauthorized insurer in which service of process was made in
the manner provided in ORS 746.320, the court may award reasonable
attorney fees to the prevailing party. [Formerly 736.258; 1981 c.897
§103; 1995 c.618 §130]ORS 746.320 to 746.360 do not apply to an action against
an unauthorized insurer arising out of any policy of:

(1) Reinsurance or wet marine and transportation insurance;

(2) Insurance effected in compliance with ORS 735.400 to 735.495;

(3) Insurance against legal liability arising out of ownership,
operation or maintenance of any property having a permanent situs outside
the state; or

(4) Insurance against loss of or damage to any property having a
permanent situs outside this state, where such policy contains a
provision designating the Director of the Department of Consumer and
Business Services or a bona fide resident of this state as the insurer’s
lawful attorney upon whom all process may be served in any action begun
by or on behalf of an insured or beneficiary and arising out of policies
of insurance between the insurer and persons residing or authorized to do
business in this state. [Formerly 736.260; 2005 c.185 §6] In order that the Director of the
Department of Consumer and Business Services may effectively administer
ORS 746.310 to 746.370, every person for or by whom insurance has been
placed with an unauthorized insurer shall, upon the director’s order,
produce for examination all policies and other documents evidencing the
insurance, and shall disclose to the director the amount of premiums paid
or agreed to be paid for the insurance. [1967 c.359 §597]PREMIUM FINANCING As used in ORS
746.405 to 746.530, unless the context requires otherwise:

(1) “Premium finance agreement” means an agreement by which an
insured or prospective insured promises to pay to a premium finance
company or to its assignee the amount advanced or to be advanced under
the agreement to an insurer or to an insurance producer in payment of
premiums on an insurance policy together with a service charge. No
mortgage, conditional sale contract or other security agreement covering
property which authorizes the lienholder to pay or advance premiums for
insurance with respect thereto shall be deemed to be a premium finance
agreement.

(2) “Premium finance company” means a person engaged in the
business of entering into premium finance agreements with insureds or of
acquiring such premium finance agreements from insurance producers or
other premium finance companies. [1969 c.639 §2; 2003 c.364 §146] In the
manner provided in ORS 731.296, the Director of the Department of
Consumer and Business Services may address inquiries to a premium finance
company, and a premium finance company shall reply to such inquiries.
[1993 c.265 §11]

(1) Any insurer authorized to transact business in this state who
finances insurance premiums on domestic risks with a service charge no
greater than that provided in ORS 746.485 and 746.495;

(2) Any bank, trust company, savings and loan association, credit
union or other lending institution authorized to transact business in
this state that does not possess or acquire any right, title or interest
with respect to the insurance policy for which the premiums are financed
other than in the proceeds thereof in the event of loss;

(3) The inclusion of a charge for insurance in connection with an
installment sale in accordance with ORS 83.010 to 83.820 and 83.990; or

(4) Insurance producers financing only their own accounts and whose
aggregate charge for financing does not exceed one and one-half percent
per month on the outstanding balance. [1969 c.639 §4; 1981 c.412 §22;
2003 c.364 §147](1) Every premium finance company shall maintain records of
its premium finance transactions and the records shall be open to
examination and investigation by the Director of the Department of
Consumer and Business Services. The director may at any time require the
company to bring such records as the director may direct to the
director’s office for examination.

(2) Every premium finance company shall preserve its records of
such premium finance transactions, including cards used in a card system,
for at least three years after making the final entry in respect to any
premium finance agreement. The preservation of records in photographic
form shall constitute compliance with this requirement. [1969 c.639 §8]No insurer shall interfere in any way with the right of
any person soliciting or procuring an application for its insurance
policies to recommend to an insured any premium finance company. [1983
c.239 §5](1) A premium finance agreement shall:

(a) Be dated, signed by the insured or by any person authorized in
writing to act in behalf of the insured, and the printed portion thereof
shall be in at least eight-point type;

(b) Contain the name and place of business of the insurance
producer negotiating the related insurance policy, the name and residence
or the place of business of the insured as specified by the insured, the
name and place of business of the premium finance company to which
payments are to be made, a description of the insurance policies involved
and the amount of the premium therefor; and

(c) Set forth the following items where applicable:

(A) The total amount of the premiums.

(B) The amount of the down payment.

(C) The principal balance (the difference between items (A) and
(B)).

(D) The amount of the service charge.

(E) The balance payable by the insured (sum of items (C) and (D)).

(F) The number of payments required, the amount of each payment
expressed in dollars, and the due date or period thereof.

(2) The items set out in subsection (1)(c) of this section need not
be stated in the sequence or order in which they appear in such
paragraph, and additional items may be included to explain the
computations made in determining the amount to be paid by the insured.

(3) The premium finance company or the insurance producer shall
deliver to the insured, or mail to the insured at the address shown in
the agreement, a complete copy of the agreement.

(4) A premium finance company shall give notice of its financing to
the insurer not later than the 30th day after the date the premium
financing agreement is received by the premium finance company. A notice
given under this subsection shall be effective whether or not the
insured’s policy number is set forth in the notice. [1969 c.639 §9; 1971
c.231 §38; 1983 c.239 §3; 2003 c.364 §148](1) A premium finance company shall not
charge, contract for, receive, or collect a service charge other than as
permitted by ORS 746.405 to 746.530.

(2) The service charge is to be computed on the balance of the
premiums due (after subtracting the down payment made by the insured in
accordance with the premium finance agreement) from the effective date of
the insurance coverage, for which the premiums are being advanced, to and
including the date when the final payment of the premium finance
agreement is payable.

(3) The service charge shall not exceed interest at a rate
authorized under this subsection plus an additional charge of 10 percent
of the amount financed or $50, whichever amount is less, per premium
finance agreement. The additional charge need not be refunded upon
cancellation or prepayment. The rate of interest charged by a premium
finance company on the amount of financed premium shall not exceed the
nominal annual rate of five percentage points in excess of the discount
rate, and any surcharge thereon, on 90-day commercial paper in effect at
the Federal Reserve Bank in the Federal Reserve District which includes
Oregon on the effective date of the insurance coverage or 18 percent,
whichever is greater.

(4) Any insured may prepay the premium finance agreement in full at
any time before the due date of the final payment. In such event the
unearned interest shall be refunded. The amount of any such refund shall
be the total amount of interest due on the agreement less the interest
earned to the installment date nearest the date of payment, computed by
applying the actuarial method based on the annual percentage rate set
forth on the premium finance agreement. [1969 c.639 §10; 1971 c.231 §39;
1983 c.239 §1] (1) A premium finance
agreement may provide for the payment by the insured of a delinquency
charge for any payment that is in default for a period of 10 days or
more. Such charge may be made for each month or fraction thereof that the
payment is in default. The amount of such charge may be a minimum of $1
and as a maximum shall be subject to the following limits:

(a) For delinquent payments of less than $250, five percent of the
payment or $5, whichever is less; or

(b) For delinquent payments of $250 or more, two percent of the
payment.

(2) If a payment default results in the cancellation of any
insurance policy listed in the agreement, the agreement may provide for
the payment by the insured of a cancellation charge of $5, less any
delinquency charges imposed in respect to the payment in default. [1969
c.639 §11](1) When a premium finance
agreement contains a power of attorney enabling the premium finance
company to cancel any insurance policy or policies listed in the
agreement, the insurance policy or policies shall not be canceled by the
premium finance company unless such cancellation is effectuated in
accordance with this section.

(2) Not less than 10 days’ written notice shall be mailed to the
insured of the intent of the premium finance company to cancel the
insurance policy unless the default is cured within such 10-day period. A
copy of such notice shall also be mailed to the insurance producer
indicated on the premium finance agreement.

(3) After expiration of such 10-day period, the premium finance
company may thereafter in the name of the insured cancel such insurance
policy or policies by mailing to the insurer a notice of cancellation,
and the insurance policy shall be canceled as if such notice of
cancellation had been submitted by the insured, but without requiring the
return of the insurance policy or policies. The premium finance company
shall also mail a notice of cancellation to the insured at the last-known
address of the insured and to the insurance producer indicated on the
premium finance agreement.

(4) All statutory, regulatory and contractual restrictions
providing that the insurance policy may not be canceled unless notice is
given to a governmental agency, mortgagee, or other third party shall
apply where cancellation is effected under the provisions of this
section. The insurer shall give the prescribed notice on behalf of itself
or the insured to any governmental agency, mortgagee, or other third
party on or before the second business day after the day it receives the
notice of cancellation from the premium finance company and shall
determine the effective date of cancellation taking into consideration
the number of days’ notice required to complete the cancellation. [1969
c.639 §12; 1983 c.239 §2; 2003 c.364 §149] (1) Whenever a
financed insurance policy is canceled, the insurer who has been notified
as provided in ORS 746.475 (4) shall return whatever gross unearned
premiums are due under the insurance policy to the premium finance
company for the account of the insured or insureds not later than the
30th day after the date of cancellation. If the insurer elects to return
the premium through the insurance producer, the insurance producer shall
transmit the unearned premium to the premium finance company within the
30-day period. The insurer, on written notice of any failure of the
insurance producer to transmit the premium and not later than the 30th
day after the notice, shall pay the amount of return premium directly to
the premium finance company.

(2) In calculating the gross unearned premium due under a financed
insurance policy, the insurer shall use the prorate method of calculation.

(3) In the event that the crediting of return premiums to the
account of the insured results in a surplus over the amount due from the
insured, the premium finance company shall refund such excess to the
insured provided that no such refund shall be required if it amounts to
less than $1. [1969 c.639 §13; 1983 c.239 §7; 2003 c.364 §150] No filing of the
premium finance agreement shall be necessary to perfect the validity of
such agreement as a secured transaction as against creditors, subsequent
purchasers, pledgees, encumbrancers, successors or assigns. [1969 c.639
§14] In any action to enforce any right created
by ORS 746.405 to 746.530, the prevailing party may be awarded a
reasonable amount, to be fixed by the court, as attorney fees. The amount
may be taxed as part of the cost of the action and any appeal thereon.
[1983 c.239 §6]USE AND DISCLOSURE OF INSURANCE INFORMATION As used in ORS
746.600 to 746.690:

(1)(a) “Adverse underwriting decision” means any of the following
actions with respect to insurance transactions involving insurance
coverage that is individually underwritten:

(A) A declination of insurance coverage.

(B) A termination of insurance coverage.

(C) Failure of an insurance producer to apply for insurance
coverage with a specific insurer that the insurance producer represents
and that is requested by an applicant.

(D) In the case of life or health insurance coverage, an offer to
insure at higher than standard rates.

(E) In the case of individual health insurance coverage, an offer
to insure the applicant under a health benefit plan other than the health
benefit plan initially elected by the applicant.

(F) In the case of individual health insurance coverage, an offer
to insure the applicant under a health benefit plan that imposes a waiver
of coverage for one or more preexisting conditions for a period of time
that is greater than six months and less than 24 months following the
applicant’s effective date of coverage.

(G) In the case of insurance coverage other than life or health
insurance coverage:

(i) Placement by an insurer or insurance producer of a risk with a
residual market mechanism, an unauthorized insurer or an insurer that
specializes in substandard risks.

(ii) The charging of a higher rate on the basis of information that
differs from that which the applicant or policyholder furnished.

(iii) An increase in any charge imposed by the insurer for any
personal insurance in connection with the underwriting of insurance. For
purposes of this sub-subparagraph, the imposition of a service fee is not
a charge.

(b) “Adverse underwriting decision” does not mean any of the
following actions, but the insurer or insurance producer responsible for
the occurrence of the action must nevertheless provide the applicant or
policyholder with the specific reason or reasons for the occurrence:

(A) The termination of an individual policy form on a class or
statewide basis.

(B) A declination of insurance coverage solely because the coverage
is not available on a class or statewide basis.

(C) The rescission of a policy.

(2) “Affiliate of” a specified person or “person affiliated with” a
specified person means a person who directly, or indirectly, through one
or more intermediaries, controls, or is controlled by, or is under common
control with, the person specified.

(3) “Applicant” means a person who seeks to contract for insurance
coverage, other than a person seeking group insurance coverage that is
not individually underwritten.

(4) “Consumer” means an individual, or the personal representative
of the individual, who seeks to obtain, obtains or has obtained one or
more insurance products or services from a licensee that are to be used
primarily for personal, family or household purposes, and about whom the
licensee has personal information.

(5) “Consumer report” means any written, oral or other
communication of information bearing on a natural person’s
creditworthiness, credit standing, credit capacity, character, general
reputation, personal characteristics or mode of living that is used or
expected to be used in connection with an insurance transaction.

(6) “Consumer reporting agency” means a person that, for monetary
fees or dues, or on a cooperative or nonprofit basis:

(a) Regularly engages, in whole or in part, in assembling or
preparing consumer reports;

(b) Obtains information primarily from sources other than insurers;
and

(c) Furnishes consumer reports to other persons.

(7) “Control” means, and the terms “controlled by” or “under common
control with” refer to, the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of
a person, whether through the ownership of voting securities, by contract
other than a commercial contract for goods or nonmanagement services, or
otherwise, unless the power of the person is the result of a corporate
office held in, or an official position held with, the controlled person.

(8) “Covered entity” means:

(a) A health insurer;

(b) A health care provider that transmits any health information in
electronic form to carry out financial or administrative activities in
connection with a transaction covered by ORS 746.607 or by rules adopted
under ORS 746.608; or

(c) A health care clearinghouse.

(9) “Credit history” means any written or other communication of
any information by a consumer reporting agency that:

(a) Bears on a consumer’s creditworthiness, credit standing or
credit capacity; and

(b) Is used or expected to be used, or collected in whole or in
part, as a factor in determining eligibility, premiums or rates for
personal insurance.

(10) “Customer” means a consumer who has a continuing relationship
with a licensee under which the licensee provides one or more insurance
products or services to the consumer that are to be used primarily for
personal, family or household purposes.

(11) “Declination of insurance coverage” or “decline coverage”
means a denial, in whole or in part, by an insurer or insurance producer
of an application for requested insurance coverage.

(12) “Health care” means care, services or supplies related to the
health of an individual.

(13) “Health care operations” includes but is not limited to:

(a) Quality assessment, accreditation, auditing and improvement
activities;

(b) Case management and care coordination;

(c) Reviewing the competence, qualifications or performance of
health care providers or health insurers;

(d) Underwriting activities;

(e) Arranging for legal services;

(f) Business planning;

(g) Customer services;

(h) Resolving internal grievances;

(i) Creating de-identified information; and

(j) Fundraising.

(14) “Health care provider” includes but is not limited to:

(a) A psychologist, occupational therapist, clinical social worker,
professional counselor or marriage and family therapist licensed under
ORS chapter 675 or an employee of the psychologist, occupational
therapist, clinical social worker, professional counselor or marriage and
family therapist;

(b) A physician, podiatric physician and surgeon, physician
assistant or acupuncturist licensed under ORS chapter 677 or an employee
of the physician, podiatric physician and surgeon, physician assistant or
acupuncturist;

(c) A nurse or nursing home administrator licensed under ORS
chapter 678 or an employee of the nurse or nursing home administrator;

(d) A dentist licensed under ORS chapter 679 or an employee of the
dentist;

(e) A dental hygienist or denturist licensed under ORS chapter 680
or an employee of the dental hygienist or denturist;

(f) A speech-language pathologist or audiologist licensed under ORS
chapter 681 or an employee of the speech-language pathologist or
audiologist;

(g) An emergency medical technician certified under ORS chapter 682;

(h) An optometrist licensed under ORS chapter 683 or an employee of
the optometrist;

(i) A chiropractic physician licensed under ORS chapter 684 or an
employee of the chiropractic physician;

(j) A naturopathic physician licensed under ORS chapter 685 or an
employee of the naturopathic physician;

(k) A massage therapist licensed under ORS 687.011 to 687.250 or an
employee of the massage therapist;

(L) A direct entry midwife licensed under ORS 687.405 to 687.495 or
an employee of the direct entry midwife;

(m) A physical therapist licensed under ORS 688.010 to 688.201 or
an employee of the physical therapist;

(n) A radiologic technologist licensed under ORS 688.405 to 688.605
or an employee of the radiologic technologist;

(o) A respiratory care practitioner licensed under ORS 688.800 to
688.840 or an employee of the respiratory care practitioner;

(p) A pharmacist licensed under ORS chapter 689 or an employee of
the pharmacist;

(q) A dietitian licensed under ORS 691.405 to 691.585 or an
employee of the dietitian;

(r) A funeral service practitioner licensed under ORS chapter 692
or an employee of the funeral service practitioner;

(s) A health care facility as defined in ORS 442.015;

(t) A home health agency as defined in ORS 443.005;

(u) A hospice program as defined in ORS 443.850;

(v) A clinical laboratory as defined in ORS 438.010;

(w) A pharmacy as defined in ORS 689.005;

(x) A diabetes self-management program as defined in ORS 743.694;
and

(y) Any other person or entity that furnishes, bills for or is paid
for health care in the normal course of business.

(15) “Health information” means any oral or written information in
any form or medium that:

(a) Is created or received by a covered entity, a public health
authority, a life insurer, a school, a university or a health care
provider that is not a covered entity; and

(b) Relates to:

(A) The past, present or future physical or mental health or
condition of an individual;

(B) The provision of health care to an individual; or

(C) The past, present or future payment for the provision of health
care to an individual.

(16) “Health insurer” means:

(a) An insurer who offers:

(A) A health benefit plan as defined in ORS 743.730;

(B) A short term health insurance policy, the duration of which
does not exceed six months including renewals;

(C) A student health insurance policy;

(D) A medicare supplemental policy; or

(E) A dental only policy.

(b) The Oregon Medical Insurance Pool operated by the Oregon
Medical Insurance Pool Board under ORS 735.600 to 735.650.

(17) “Homeowner insurance” means insurance for residential property
consisting of a combination of property insurance and casualty insurance
that provides coverage for the risks of owning or occupying a dwelling
and that is not intended to cover an owner’s interest in rental property
or commercial exposures.

(18) “Individual” means a natural person who:

(a) In the case of life or health insurance, is a past, present or
proposed principal insured or certificate holder;

(b) In the case of other kinds of insurance, is a past, present or
proposed named insured or certificate holder;

(c) Is a past, present or proposed policyowner;

(d) Is a past or present applicant;

(e) Is a past or present claimant; or

(f) Derived, derives or is proposed to derive insurance coverage
under an insurance policy or certificate that is subject to ORS 746.600
to 746.690.

(19) “Individually identifiable health information” means any oral
or written health information that is:

(a) Created or received by a covered entity or a health care
provider that is not a covered entity; and

(b) Identifiable to an individual, including demographic
information that identifies the individual, or for which there is a
reasonable basis to believe the information can be used to identify an
individual, and that relates to:

(A) The past, present or future physical or mental health or
condition of an individual;

(B) The provision of health care to an individual; or

(C) The past, present or future payment for the provision of health
care to an individual.

(20) “Institutional source” means a person or governmental entity
that provides information about an individual to an insurer, insurance
producer or insurance-support organization, other than:

(a) An insurance producer;

(b) The individual who is the subject of the information; or

(c) A natural person acting in a personal capacity rather than in a
business or professional capacity.

(21) “Insurance producer” or “producer” means a person licensed by
the Director of the Department of Consumer and Business Services as a
resident or nonresident insurance producer.

(22) “Insurance score” means a number or rating that is derived
from an algorithm, computer application, model or other process that is
based in whole or in part on credit history.

(23)(a) “Insurance-support organization” means a person who
regularly engages, in whole or in part, in assembling or collecting
information about natural persons for the primary purpose of providing
the information to an insurer or insurance producer for insurance
transactions, including:

(A) The furnishing of consumer reports to an insurer or insurance
producer for use in connection with insurance transactions; and

(B) The collection of personal information from insurers, insurance
producers or other insurance-support organizations for the purpose of
detecting or preventing fraud, material misrepresentation or material
nondisclosure in connection with insurance underwriting or insurance
claim activity.

(b) “Insurance-support organization” does not mean insurers,
insurance producers, governmental institutions or health care providers.

(24) “Insurance transaction” means any transaction that involves
insurance primarily for personal, family or household needs rather than
business or professional needs and that entails:

(a) The determination of an individual’s eligibility for an
insurance coverage, benefit or payment; or

(b) The servicing of an insurance application, policy or
certificate.

(25) “Insurer” has the meaning given that term in ORS 731.106.

(26) “Investigative consumer report” means a consumer report, or
portion of a consumer report, for which information about a natural
person’s character, general reputation, personal characteristics or mode
of living is obtained through personal interviews with the person’s
neighbors, friends, associates, acquaintances or others who may have
knowledge concerning such items of information.

(27) “Licensee” means an insurer, insurance producer or other
person authorized or required to be authorized, or licensed or required
to be licensed, pursuant to the Insurance Code.

(28) “Loss history report” means a report provided by, or a
database maintained by, an insurance-support organization or consumer
reporting agency that contains information regarding the claims history
of the individual property that is the subject of the application for a
homeowner insurance policy or the consumer applying for a homeowner
insurance policy.

(29) “Nonaffiliated third party” means any person except:

(a) An affiliate of a licensee;

(b) A person that is employed jointly by a licensee and by a person
that is not an affiliate of the licensee; and

(c) As designated by the director by rule.

(30) “Payment” includes but is not limited to:

(a) Efforts to obtain premiums or reimbursement;

(b) Determining eligibility or coverage;

(c) Billing activities;

(d) Claims management;

(e) Reviewing health care to determine medical necessity;

(f) Utilization review; and

(g) Disclosures to consumer reporting agencies.

(31)(a) “Personal financial information” means:

(A) Information that is identifiable with an individual, gathered
in connection with an insurance transaction from which judgments can be
made about the individual’s character, habits, avocations, finances,
occupations, general reputation, credit or any other personal
characteristics; or

(B) An individual’s name, address and policy number or similar form
of access code for the individual’s policy.

(b) “Personal financial information” does not mean information that
a licensee has a reasonable basis to believe is lawfully made available
to the general public from federal, state or local government records,
widely distributed media or disclosures to the public that are required
by federal, state or local law.

(32) “Personal information” means:

(a) Personal financial information;

(b) Individually identifiable health information; or

(c) Protected health information.

(33) “Personal insurance” means the following types of insurance
products or services that are to be used primarily for personal, family
or household purposes:

(a) Private passenger automobile coverage;

(b) Homeowner, mobile homeowners, manufactured homeowners,
condominium owners and renters coverage;

(c) Personal dwelling property coverage;

(d) Personal liability and theft coverage, including excess
personal liability and theft coverage; and

(e) Personal inland marine coverage.

(34) “Personal representative” includes but is not limited to:

(a) A person appointed as a guardian under ORS 125.305, 419B.370,
419C.481 or 419C.555 with authority to make medical and health care
decisions;

(b) A person appointed as a health care representative under ORS
127.505 to 127.660 or 127.700 to 127.737 to make health care decisions or
mental health treatment decisions;

(c) A person appointed as a personal representative under ORS
chapter 113; and

(d) A person described in ORS 746.611.

(35) “Policyholder” means a person who:

(a) In the case of individual policies of life or health insurance,
is a current policyowner;

(b) In the case of individual policies of other kinds of insurance,
is currently a named insured; or

(c) In the case of group policies of insurance under which coverage
is individually underwritten, is a current certificate holder.

(36) “Pretext interview” means an interview wherein the
interviewer, in an attempt to obtain personal information about a natural
person, does one or more of the following:

(a) Pretends to be someone the interviewer is not.

(b) Pretends to represent a person the interviewer is not in fact
representing.

(c) Misrepresents the true purpose of the interview.

(d) Refuses upon request to identify the interviewer.

(37) “Privileged information” means information that is
identifiable with an individual and that:

(a) Relates to a claim for insurance benefits or a civil or
criminal proceeding involving the individual; and

(b) Is collected in connection with or in reasonable anticipation
of a claim for insurance benefits or a civil or criminal proceeding
involving the individual.

(38)(a) “Protected health information” means individually
identifiable health information that is transmitted or maintained in any
form of electronic or other medium by a covered entity.

(b) “Protected health information” does not mean individually
identifiable health information in:

(A) Education records covered by the federal Family Educational
Rights and Privacy Act (20 U.S.C. 1232g);

(B) Records described at 20 U.S.C. 1232g(a)(4)(B)(iv); or

(C) Employment records held by a covered entity in its role as
employer.

(39) “Residual market mechanism” means an association, organization
or other entity involved in the insuring of risks under ORS 735.005 to
735.145, 737.312 or other provisions of the Insurance Code relating to
insurance applicants who are unable to procure insurance through normal
insurance markets.

(40) “Termination of insurance coverage” or “termination of an
insurance policy” means either a cancellation or a nonrenewal of an
insurance policy, in whole or in part, for any reason other than the
failure of a premium to be paid as required by the policy.

(41) “Treatment” includes but is not limited to:

(a) The provision, coordination or management of health care; and

(b) Consultations and referrals between health care providers.
[1981 c.649 §4; 1987 c.490 §50; 2001 c.191 §50; 2001 c.377 §25; 2003 c.87
§6; 2003 c.364 §151; 2003 c.590 §2; 2003 c.599 §5; 2003 c.788 §1a; 2005
c.253 §6; 2005 c.489 §1]Note: The amendments to 746.600 by section 4, chapter 590, Oregon
Laws 2003, and section 7, chapter 599, Oregon Laws 2003, become operative
January 2, 2008. See section 5, chapter 590, Oregon Laws 2003, and
section 8, chapter 599, Oregon Laws 2003. The text that is operative on
and after January 2, 2008, including amendments by section 7, chapter
253, Oregon Laws 2005, and section 2, chapter 489, Oregon Laws 2005, is
set forth for the user’s convenience.

746.600. As used in ORS 746.600 to 746.690:

(1)(a) “Adverse underwriting decision” means any of the following
actions with respect to insurance transactions involving insurance
coverage that is individually underwritten:

(A) A declination of insurance coverage.

(B) A termination of insurance coverage.

(C) Failure of an insurance producer to apply for insurance
coverage with a specific insurer that the insurance producer represents
and that is requested by an applicant.

(D) In the case of life or health insurance coverage, an offer to
insure at higher than standard rates.

(E) In the case of insurance coverage other than life or health
insurance coverage:

(i) Placement by an insurer or insurance producer of a risk with a
residual market mechanism, an unauthorized insurer or an insurer that
specializes in substandard risks.

(ii) The charging of a higher rate on the basis of information that
differs from that which the applicant or policyholder furnished.

(iii) An increase in any charge imposed by the insurer for any
personal insurance in connection with the underwriting of insurance. For
purposes of this sub-subparagraph, the imposition of a service fee is not
a charge.

(b) “Adverse underwriting decision” does not mean any of the
following actions, but the insurer or insurance producer responsible for
the occurrence of the action must nevertheless provide the applicant or
policyholder with the specific reason or reasons for the occurrence:

(A) The termination of an individual policy form on a class or
statewide basis.

(B) A declination of insurance coverage solely because the coverage
is not available on a class or statewide basis.

(C) The rescission of a policy.

(2) “Affiliate of” a specified person or “person affiliated with” a
specified person means a person who directly, or indirectly, through one
or more intermediaries, controls, or is controlled by, or is under common
control with, the person specified.

(3) “Applicant” means a person who seeks to contract for insurance
coverage, other than a person seeking group insurance coverage that is
not individually underwritten.

(4) “Consumer” means an individual, or the personal representative
of the individual, who seeks to obtain, obtains or has obtained one or
more insurance products or services from a licensee that are to be used
primarily for personal, family or household purposes, and about whom the
licensee has personal information.

(5) “Consumer report” means any written, oral or other
communication of information bearing on a natural person’s
creditworthiness, credit standing, credit capacity, character, general
reputation, personal characteristics or mode of living that is used or
expected to be used in connection with an insurance transaction.

(6) “Consumer reporting agency” means a person that, for monetary
fees or dues, or on a cooperative or nonprofit basis:

(a) Regularly engages, in whole or in part, in assembling or
preparing consumer reports;

(b) Obtains information primarily from sources other than insurers;
and

(c) Furnishes consumer reports to other persons.

(7) “Control” means, and the terms “controlled by” or “under common
control with” refer to, the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of
a person, whether through the ownership of voting securities, by contract
other than a commercial contract for goods or nonmanagement services, or
otherwise, unless the power of the person is the result of a corporate
office held in, or an official position held with, the controlled person.

(8) “Covered entity” means:

(a) A health insurer;

(b) A health care provider that transmits any health information in
electronic form to carry out financial or administrative activities in
connection with a transaction covered by ORS 746.607 or by rules adopted
under ORS 746.608; or

(c) A health care clearinghouse.

(9) “Credit history” means any written or other communication of
any information by a consumer reporting agency that:

(a) Bears on a consumer’s creditworthiness, credit standing or
credit capacity; and

(b) Is used or expected to be used, or collected in whole or in
part, as a factor in determining eligibility, premiums or rates for
personal insurance.

(10) “Customer” means a consumer who has a continuing relationship
with a licensee under which the licensee provides one or more insurance
products or services to the consumer that are to be used primarily for
personal, family or household purposes.

(11) “Declination of insurance coverage” or “decline coverage”
means a denial, in whole or in part, by an insurer or insurance producer
of an application for requested insurance coverage.

(12) “Health care” means care, services or supplies related to the
health of an individual.

(13) “Health care operations” includes but is not limited to:

(a) Quality assessment, accreditation, auditing and improvement
activities;

(b) Case management and care coordination;

(c) Reviewing the competence, qualifications or performance of
health care providers or health insurers;

(d) Underwriting activities;

(e) Arranging for legal services;

(f) Business planning;

(g) Customer services;

(h) Resolving internal grievances;

(i) Creating de-identified information; and

(j) Fundraising.

(14) “Health care provider” includes but is not limited to:

(a) A psychologist, occupational therapist, clinical social worker,
professional counselor or marriage and family therapist licensed under
ORS chapter 675 or an employee of the psychologist, occupational
therapist, clinical social worker, professional counselor or marriage and
family therapist;

(b) A physician, podiatric physician and surgeon, physician
assistant or acupuncturist licensed under ORS chapter 677 or an employee
of the physician, podiatric physician and surgeon, physician assistant or
acupuncturist;

(c) A nurse or nursing home administrator licensed under ORS
chapter 678 or an employee of the nurse or nursing home administrator;

(d) A dentist licensed under ORS chapter 679 or an employee of the
dentist;

(e) A dental hygienist or denturist licensed under ORS chapter 680
or an employee of the dental hygienist or denturist;

(f) A speech-language pathologist or audiologist licensed under ORS
chapter 681 or an employee of the speech-language pathologist or
audiologist;

(g) An emergency medical technician certified under ORS chapter 682;

(h) An optometrist licensed under ORS chapter 683 or an employee of
the optometrist;

(i) A chiropractic physician licensed under ORS chapter 684 or an
employee of the chiropractic physician;

(j) A naturopathic physician licensed under ORS chapter 685 or an
employee of the naturopathic physician;

(k) A massage therapist licensed under ORS 687.011 to 687.250 or an
employee of the massage therapist;

(L) A direct entry midwife licensed under ORS 687.405 to 687.495 or
an employee of the direct entry midwife;

(m) A physical therapist licensed under ORS 688.010 to 688.201 or
an employee of the physical therapist;

(n) A radiologic technologist licensed under ORS 688.405 to 688.605
or an employee of the radiologic technologist;

(o) A respiratory care practitioner licensed under ORS 688.800 to
688.840 or an employee of the respiratory care practitioner;

(p) A pharmacist licensed under ORS chapter 689 or an employee of
the pharmacist;

(q) A dietitian licensed under ORS 691.405 to 691.585 or an
employee of the dietitian;

(r) A funeral service practitioner licensed under ORS chapter 692
or an employee of the funeral service practitioner;

(s) A health care facility as defined in ORS 442.015;

(t) A home health agency as defined in ORS 443.005;

(u) A hospice program as defined in ORS 443.850;

(v) A clinical laboratory as defined in ORS 438.010;

(w) A pharmacy as defined in ORS 689.005;

(x) A diabetes self-management program as defined in ORS 743.694;
and

(y) Any other person or entity that furnishes, bills for or is paid
for health care in the normal course of business.

(15) “Health information” means any oral or written information in
any form or medium that:

(a) Is created or received by a covered entity, a public health
authority, a life insurer, a school, a university or a health care
provider that is not a covered entity; and

(b) Relates to:

(A) The past, present or future physical or mental health or
condition of an individual;

(B) The provision of health care to an individual; or

(C) The past, present or future payment for the provision of health
care to an individual.

(16) “Health insurer” means:

(a) An insurer who offers:

(A) A health benefit plan as defined in ORS 743.730;

(B) A short term health insurance policy, the duration of which
does not exceed six months including renewals;

(C) A student health insurance policy;

(D) A medicare supplemental policy; or

(E) A dental only policy.

(b) The Oregon Medical Insurance Pool operated by the Oregon
Medical Insurance Pool Board under ORS 735.600 to 735.650.

(17) “Homeowner insurance” means insurance for residential property
consisting of a combination of property insurance and casualty insurance
that provides coverage for the risks of owning or occupying a dwelling
and that is not intended to cover an owner’s interest in rental property
or commercial exposures.

(18) “Individual” means a natural person who:

(a) In the case of life or health insurance, is a past, present or
proposed principal insured or certificate holder;

(b) In the case of other kinds of insurance, is a past, present or
proposed named insured or certificate holder;

(c) Is a past, present or proposed policyowner;

(d) Is a past or present applicant;

(e) Is a past or present claimant; or

(f) Derived, derives or is proposed to derive insurance coverage
under an insurance policy or certificate that is subject to ORS 746.600
to 746.690.

(19) “Individually identifiable health information” means any oral
or written health information that is:

(a) Created or received by a covered entity or a health care
provider that is not a covered entity; and

(b) Identifiable to an individual, including demographic
information that identifies the individual, or for which there is a
reasonable basis to believe the information can be used to identify an
individual, and that relates to:

(A) The past, present or future physical or mental health or
condition of an individual;

(B) The provision of health care to an individual; or

(C) The past, present or future payment for the provision of health
care to an individual.

(20) “Institutional source” means a person or governmental entity
that provides information about an individual to an insurer, insurance
producer or insurance-support organization, other than:

(a) An insurance producer;

(b) The individual who is the subject of the information; or

(c) A natural person acting in a personal capacity rather than in a
business or professional capacity.

(21) “Insurance producer” or “producer” means a person licensed by
the Director of the Department of Consumer and Business Services as a
resident or nonresident insurance producer.

(22) “Insurance score” means a number or rating that is derived
from an algorithm, computer application, model or other process that is
based in whole or in part on credit history.

(23)(a) “Insurance-support organization” means a person who
regularly engages, in whole or in part, in assembling or collecting
information about natural persons for the primary purpose of providing
the information to an insurer or insurance producer for insurance
transactions, including:

(A) The furnishing of consumer reports to an insurer or insurance
producer for use in connection with insurance transactions; and

(B) The collection of personal information from insurers, insurance
producers or other insurance-support organizations for the purpose of
detecting or preventing fraud, material misrepresentation or material
nondisclosure in connection with insurance underwriting or insurance
claim activity.

(b) “Insurance-support organization” does not mean insurers,
insurance producers, governmental institutions or health care providers.

(24) “Insurance transaction” means any transaction that involves
insurance primarily for personal, family or household needs rather than
business or professional needs and that entails:

(a) The determination of an individual’s eligibility for an
insurance coverage, benefit or payment; or

(b) The servicing of an insurance application, policy or
certificate.

(25) “Insurer” has the meaning given that term in ORS 731.106.

(26) “Investigative consumer report” means a consumer report, or
portion of a consumer report, for which information about a natural
person’s character, general reputation, personal characteristics or mode
of living is obtained through personal interviews with the person’s
neighbors, friends, associates, acquaintances or others who may have
knowledge concerning such items of information.

(27) “Licensee” means an insurer, insurance producer or other
person authorized or required to be authorized, or licensed or required
to be licensed, pursuant to the Insurance Code.

(28) “Loss history report” means a report provided by, or a
database maintained by, an insurance-support organization or consumer
reporting agency that contains information regarding the claims history
of the individual property that is the subject of the application for a
homeowner insurance policy or the consumer applying for a homeowner
insurance policy.

(29) “Nonaffiliated third party” means any person except:

(a) An affiliate of a licensee;

(b) A person that is employed jointly by a licensee and by a person
that is not an affiliate of the licensee; and

(c) As designated by the director by rule.

(30) “Payment” includes but is not limited to:

(a) Efforts to obtain premiums or reimbursement;

(b) Determining eligibility or coverage;

(c) Billing activities;

(d) Claims management;

(e) Reviewing health care to determine medical necessity;

(f) Utilization review; and

(g) Disclosures to consumer reporting agencies.

(31)(a) “Personal financial information” means:

(A) Information that is identifiable with an individual, gathered
in connection with an insurance transaction from which judgments can be
made about the individual’s character, habits, avocations, finances,
occupations, general reputation, credit or any other personal
characteristics; or

(B) An individual’s name, address and policy number or similar form
of access code for the individual’s policy.

(b) “Personal financial information” does not mean information that
a licensee has a reasonable basis to believe is lawfully made available
to the general public from federal, state or local government records,
widely distributed media or disclosures to the public that are required
by federal, state or local law.

(32) “Personal information” means:

(a) Personal financial information;

(b) Individually identifiable health information; or

(c) Protected health information.

(33) “Personal insurance” means the following types of insurance
products or services that are to be used primarily for personal, family
or household purposes:

(a) Private passenger automobile coverage;

(b) Homeowner, mobile homeowners, manufactured homeowners,
condominium owners and renters coverage;

(c) Personal dwelling property coverage;

(d) Personal liability and theft coverage, including excess
personal liability and theft coverage; and

(e) Personal inland marine coverage.

(34) “Personal representative” includes but is not limited to:

(a) A person appointed as a guardian under ORS 125.305, 419B.370,
419C.481 or 419C.555 with authority to make medical and health care
decisions;

(b) A person appointed as a health care representative under ORS
127.505 to 127.660 or 127.700 to 127.737 to make health care decisions or
mental health treatment decisions;

(c) A person appointed as a personal representative under ORS
chapter 113; and

(d) A person described in ORS 746.611.

(35) “Policyholder” means a person who:

(a) In the case of individual policies of life or health insurance,
is a current policyowner;

(b) In the case of individual policies of other kinds of insurance,
is currently a named insured; or

(c) In the case of group policies of insurance under which coverage
is individually underwritten, is a current certificate holder.

(36) “Pretext interview” means an interview wherein the
interviewer, in an attempt to obtain personal information about a natural
person, does one or more of the following:

(a) Pretends to be someone the interviewer is not.

(b) Pretends to represent a person the interviewer is not in fact
representing.

(c) Misrepresents the true purpose of the interview.

(d) Refuses upon request to identify the interviewer.

(37) “Privileged information” means information that is
identifiable with an individual and that:

(a) Relates to a claim for insurance benefits or a civil or
criminal proceeding involving the individual; and

(b) Is collected in connection with or in reasonable anticipation
of a claim for insurance benefits or a civil or criminal proceeding
involving the individual.

(38)(a) “Protected health information” means individually
identifiable health information that is transmitted or maintained in any
form of electronic or other medium by a covered entity.

(b) “Protected health information” does not mean individually
identifiable health information in:

(A) Education records covered by the federal Family Educational
Rights and Privacy Act (20 U.S.C. 1232g);

(B) Records described at 20 U.S.C. 1232g(a)(4)(B)(iv); or

(C) Employment records held by a covered entity in its role as
employer.

(39) “Residual market mechanism” means an association, organization
or other entity involved in the insuring of risks under ORS 735.005 to
735.145, 737.312 or other provisions of the Insurance Code relating to
insurance applicants who are unable to procure insurance through normal
insurance markets.

(40) “Termination of insurance coverage” or “termination of an
insurance policy” means either a cancellation or a nonrenewal of an
insurance policy, in whole or in part, for any reason other than the
failure of a premium to be paid as required by the policy.

(41) “Treatment” includes but is not limited to:

(a) The provision, coordination or management of health care; and

(b) Consultations and referrals between health care providers.The purpose of ORS 746.600 to 746.690 is to:

(1) Establish standards for the collection, use and disclosure of
personal information gathered in connection with insurance transactions
by insurers, insurance producers or insurance-support organizations;

(2) Maintain a balance between the need for personal information by
those conducting the business of insurance and the public’s need for
fairness in insurance information practices, including the need to
minimize intrusiveness;

(3) Establish a regulatory mechanism to enable natural persons to
ascertain what personal information is being or has been collected about
them in connection with insurance transactions and to have access to this
personal information for the purpose of verifying or disputing its
accuracy;

(4) Limit the disclosure of personal information collected in
connection with insurance transactions; and

(5) Enable insurance applicants and policyholders to obtain the
reasons for any adverse underwriting decision. [1981 c.649 §2; 1987 c.490
§51; 2003 c.87 §7; 2003 c.364 §152] ORS
746.607 and 746.608 establish standards for health insurers that are
subject to the information privacy provisions of both the federal Health
Insurance Portability and Accountability Act of 1996 (P.L. 104-191) and
the federal Gramm-Leach-Bliley Act (P.L. 106-102). These standards
address:

(1) Use and disclosure of personal information;

(2) Access of individuals to personal information;

(3) Notice of privacy practices for personal information;

(4) Amendment of personal information; and

(5) Accounting of disclosures of personal information. [2003 c.87
§2] A health
insurer:

(1) May use or disclose personal information of an individual in a
manner that is consistent with an authorization provided by the
individual or a personal representative of the individual.

(2) May use or disclose protected health information of an
individual without obtaining an authorization from the individual or a
personal representative of the individual:

(a) For its own treatment, payment or health care operations; or

(b) As otherwise permitted or required by state or federal law or
by order of the court.

(3) May disclose, subject to any requirements established by rule
under ORS 746.608 and consistent with federal law, protected health
information of an individual without obtaining an authorization from the
individual or a personal representative of the individual:

(a) To another covered entity for health care operations activities
of the entity that receives the information if:

(A) Each entity has or had a relationship with the individual who
is the subject of the protected health information; and

(B) The protected health information pertains to the relationship
and the disclosure is for the purpose of:

(i) Health care operations listed in ORS 746.600 (13)(a) or (b); or

(ii) Health care fraud and abuse detection or compliance;

(b) To another covered entity or any other health care provider for
treatment activities of a health care provider; or

(c) To another covered entity or any other health care provider for
the payment activities of the entity that receives the information.

(4) May use or disclose personal financial information of an
individual:

(a) To perform a business, professional or insurance function,
subject to any requirements established by rule under ORS 746.608 for an
authorization by an individual or a personal representative of an
individual; or

(b) Without obtaining an authorization by the individual or the
personal representative of the individual as otherwise permitted or
required by state or federal law or by order of the court.

(5) May charge a reasonable, cost-based fee, provided that the fee
includes only the cost of:

(a) Copying personal information requested by an individual or a
personal representative of the individual, including the cost of supplies
for and labor of copying;

(b) Postage, when an individual or a personal representative of the
individual has requested that copies of personal information or an
explanation or summary of protected health information be mailed; or

(c) Preparing an explanation or summary of personal information if
requested by an individual or a personal representative of the individual.

(6) Shall provide adequate notice of the uses and disclosures of
personal information that may be made by the health insurer and of the
individual’s rights and the health insurer’s legal duties with respect to
personal information.

(7) Shall permit an individual or a personal representative of an
individual to request:

(a) Access to inspect or obtain a copy of the individual’s personal
financial information or protected health information that is maintained
in a designated record set about the individual; or

(b) That the health insurer correct, amend or delete personal
information. [2003 c.87 §3] (1) The Director of the Department of Consumer and
Business Services shall adopt rules implementing ORS 746.607. In adopting
rules under this section, the director shall consider the information
privacy provisions of the federal Health Insurance Portability and
Accountability Act of 1996 (P.L. 104-191) and the federal
Gramm-Leach-Bliley Act (P.L. 106-102).

(2) The rules adopted under subsection (1) of this section shall
include but are not limited to:

(a) Permitted uses and disclosures of:

(A) Personal financial information for business, professional or
insurance purposes; and

(B) Protected health information for treatment, payment and health
care operations.

(b) Requirements for notice of privacy practices for protected
health information and notice of information practices for personal
financial information. [2003 c.87 §4]ORS 746.620, 746.630,
746.640, 746.645 and 746.665 do not apply to health insurers. [2003 c.87
§5] (1) Except as
otherwise provided in ORS 746.606, 746.607, 746.608 and 746.609, the
obligations imposed by ORS 746.600 to 746.690 apply to those insurers,
insurance producers and insurance-support organizations that:

(a) In the case of life or health insurance:

(A) Collect, receive or maintain personal information, in
connection with insurance transactions, that pertains to natural persons
who are residents of this state; or

(B) Engage in insurance transactions with applicants, individuals
or policyholders who are residents of this state.

(b) In the case of other kinds of insurance:

(A) Collect, receive or maintain personal information in connection
with insurance transactions involving policies or certificates of
insurance delivered, issued for delivery or renewed in this state; or

(B) Engage in insurance transactions involving policies or
certificates of insurance delivered, issued for delivery or renewed in
this state.

(2) The rights granted by ORS 746.600 to 746.690 extend to:

(a) In the case of life or health insurance, the following persons
who are residents of this state:

(A) Natural persons who are the subject of personal information
collected, received or maintained in connection with insurance
transactions; and

(B) Applicants, individuals or policyholders who engage in or seek
to engage in insurance transactions.

(b) In the case of other kinds of insurance, the following persons:

(A) Natural persons who are the subject of personal information
collected, received or maintained in connection with insurance
transactions involving policies or certificates of insurance delivered,
issued for delivery or renewed in this state; and

(B) Applicants, individuals or policyholders who engage in or seek
to engage in insurance transactions involving policies or certificates of
insurance delivered, issued for delivery or renewed in this state.

(3) For purposes of this section, a person is considered a resident
of this state if the person’s last-known mailing address, as shown in the
records of the insurer, insurance producer or insurance-support
organization, is located in this state.

(4) Notwithstanding subsections (1) and (2) of this section, ORS
746.600 to 746.690 do not apply to personal information collected from
the public records of a governmental authority and maintained by an
insurer or its representatives for the purpose of insuring the title to
real property located in this state. [1981 c.649 §3; 1987 c.490 §52; 2003
c.87 §8; 2003 c.364 §153] If no person
has been appointed as a personal representative under ORS chapter 113 or
a person appointed as a personal representative under ORS chapter 113 has
been discharged, the personal representative of a deceased individual
shall be the first of the following persons, in the following order, who
may be located upon reasonable effort by the covered entity and who is
willing to serve as the personal representative:

(1) A person appointed as guardian under ORS 125.305, 419B.370,
419C.481 or 419C.555 with authority to make medical and health care
decisions at the time of the individual’s death.

(2) The individual’s spouse.

(3) An adult designated in writing by the persons listed in this
section, if no person listed in this section objects to the designation.

(4) A majority of the adult children of the individual who can be
located.

(5) Either parent of the individual or an individual acting in loco
parentis to the individual.

(6) A majority of the adult siblings of the individual who can be
located.

(7) Any adult relative or adult friend. [2005 c.253 §5]Nothing in ORS 746.607 may be construed
to create a new private right of action against a health insurer. [2003
c.87 §18a] An insurer, insurance
producer or insurance-support organization may not use or authorize the
use of pretext interviews to obtain personal information in connection
with an insurance transaction. However, a pretext interview may be
undertaken to obtain information from a person or institution that does
not have a generally recognized or statutorily recognized privileged
relationship with the person about whom the information relates, for the
purpose of investigating a claim where, based upon specific information
available for review by the Director of the Department of Consumer and
Business Services, there is a reasonable basis for suspecting criminal
activity, fraud, material misrepresentation or material nondisclosure in
connection with the claim. [1981 c.649 §5; 2003 c.87 §9; 2003 c.364 §154] (1) A
licensee must provide a clear and conspicuous notice of personal
information practices to individuals in connection with insurance
transactions under the circumstances and at the times as follows:

(a) Except as provided in this paragraph, to a consumer who becomes
a customer of the licensee, not later than the date that the licensee
establishes a continuing relationship under which the licensee provides
one or more insurance products or services to the consumer that are to be
used primarily for personal, family or household purposes. A licensee may
provide the notice within a reasonable time after the date the licensee
establishes a customer relationship if:

(A) Establishing the customer relationship is not at the customer’s
election; or

(B) Providing notice not later than the date that the licensee
establishes a customer relationship would substantially delay the
customer’s transaction and the customer agrees to receive the notice at a
later time.

(b) To a consumer other than as described in paragraph (a) of this
subsection, before the licensee discloses any personal information about
the consumer pursuant to the requirements of ORS 746.665, unless the
disclosure meets one or more of the conditions specified in ORS 746.665.

(2) A licensee shall provide a clear and conspicuous notice to a
customer that accurately reflects the privacy policies and practices not
less than annually during the continuation of the relationship described
in subsection (1)(a) of this section. For the purpose of this subsection,
a notice is given annually if it is given at least once in any period of
12 consecutive months during which the relationship exists. A licensee
may define the period of 12 consecutive months, but the licensee must
apply the period to the customer on a consistent basis.

(3) The privacy notice required by subsections (1) and (2) of this
section must be in writing and clear and conspicuous. The notice may be
provided in electronic form if the recipient agrees. In addition to any
other personal information the licensee wishes to provide, the notice
shall include the following items of personal information that apply to
the licensee and to the individuals to whom the licensee sends the notice:

(a) The categories of personal information that the licensee
collects.

(b) The categories of personal information that the licensee
discloses.

(c) The categories of affiliates and nonaffiliated third parties to
whom the licensee discloses personal information other than persons to
whom the licensee discloses information under ORS 746.665.

(d) The categories of personal information about former customers
of the licensee that the licensee discloses and the categories of
affiliates and nonaffiliated third parties to whom the licensee discloses
personal information about the licensee’s former customers, other than
persons to whom the licensee discloses personal information under ORS
746.665.

(e) If a licensee discloses personal information to a nonaffiliated
third party under ORS 746.665, a separate description of the categories
of personal information the licensee discloses and the categories of
nonaffiliated third parties with whom the licensee has contracted.

(f) An explanation of the individual’s right under ORS 746.630 to
authorize disclosure of personal information, including the methods by
which the individual may exercise that right.

(g) Any disclosure that the licensee makes under section
603(d)(2)(A)(iii) of the federal Fair Credit Reporting Act (15 U.S.C.
1681a(d)(2)(A)(iii)) regarding the ability to opt out of disclosures of
personal information among affiliates.

(h) The policies and practices of the licensee with respect to
protecting the confidentiality and security of personal information.

(i) Any disclosure that the licensee makes under subsection (4) of
this section.

(j) A description of the rights established under ORS 746.640 and
746.645 and the manner in which such rights may be exercised.

(4) If a licensee discloses personal information as authorized
under ORS 746.665, the licensee is not required to list those exceptions
in the privacy notices required by this section. When describing the
categories of parties to whom disclosure is made, the licensee must state
only that the licensee makes disclosures to other affiliated parties or
nonaffiliated third parties, as applicable, as authorized by law.

(5) In lieu of the notice required in subsection (3) of this
section, the licensee may provide to a consumer an abbreviated notice, in
writing or in electronic form if the consumer agrees, informing the
consumer that:

(a) Personal information may be collected from persons other than
the consumer proposed for coverage;

(b) Such information as well as other personal or privileged
information subsequently collected by the licensee may in certain
circumstances be disclosed to third parties without authorization;

(c) A right of access and correction exists with respect to all
personal information collected; and

(d) The notice prescribed in subsection (3) of this section shall
be furnished to the consumer upon request.

(6) The Director of the Department of Consumer and Business
Services by rule may apply the categories of consumer and customer as
defined in ORS 746.600 for the purpose of establishing specific
requirements for notice of personal information practices, authorization
for disclosure of personal information, conditions for disclosure of
personal information under this section and ORS 746.630 and 746.665, and
exceptions. The director shall consider applicable definitions and terms
used in the federal Gramm-Leach-Bliley Act (P.L. 106-102), applicable
definitions and requirements used in the model “Privacy of Consumer
Financial and Health Information Regulation” adopted by the National
Association of Insurance Commissioners and other sources as may be needed
so that the terms defined in ORS 746.600 and applicable to this section
and ORS 746.630 and 746.665:

(a) Facilitate compliance with requirements in federal law and the
laws of other states that establish protections of nonpublic personal
information; and

(b) Establish separate and discrete requirements relating to the
privacy notice and its contents and delivery for customers and consumers,
so that the requirements provide reasonable notice and facilitate
compliance with requirements in federal law and in the laws of other
states.

(7) The director shall determine by rule:

(a) When a privacy notice must be provided to a certificate holder
or beneficiary of a group policy and to a third-party claimant.

(b) When the obligation to provide annual notice ceases.

(c) Requirements for revision of the notice by a licensee.

(8) An insurance producer is not subject to the requirements of
this section when the insurer on whose behalf the insurance producer acts
otherwise complies with the requirements of this section and the
insurance producer does not disclose any personal information to any
person other than the insurer or its affiliate, or as otherwise
authorized by law.

(9) A licensee may provide a joint notice from the licensee and one
or more of its affiliates or other financial institutions, as identified
in the notice, as long as the notice is accurate with respect to the
licensee and the other institutions. A licensee may also provide a notice
on behalf of a financial institution.

(10) The obligations imposed by this section upon a licensee may be
satisfied by another licensee authorized to act on behalf of the first
licensee.

(11) For purposes of this section and ORS 746.630 and 746.665, an
individual is not the consumer of a licensee solely because the
individual is covered under a group life insurance policy issued by the
licensee or is a participant or beneficiary of an employee benefit plan
that the licensee administers or sponsors or for which the licensee acts
as a trustee, insurer or fiduciary, if:

(a) The licensee provides to the policyholder the initial, annual
and revised notices under this section; and

(b) The licensee does not disclose to a nonaffiliated third party
personal information about the individual other than as permitted by ORS
746.665.

(12) When an individual becomes a consumer of a licensee under
subsection (11) of this section, this section and ORS 746.630 and 746.665
apply to the licensee with respect to the individual. [1981 c.649 §6;
2001 c.377 §26; 2003 c.87 §10; 2003 c.364 §155] An insurer or insurance
producer shall clearly identify those questions that are designed to
obtain personal information solely for marketing or research purposes
from an individual in connection with an insurance transaction. [1981
c.649 §7; 2003 c.87 §11; 2003 c.364 §156](1) Notwithstanding any other law of this state, a licensee
or insurance-support organization may not use as its disclosure
authorization form in connection with insurance transactions a form or
statement that authorizes the disclosure of personal or privileged
information about an individual to the licensee or insurance-support
organization unless the form or statement is clear and conspicuous, and
contains all of the following:

(a) The identity of the individual who is the subject of the
personal information.

(b) A general description of the categories of personal information
to be disclosed.

(c) General descriptions of the parties to whom the licensee
discloses personal information, the purpose of the disclosure and how the
personal information may be used.

(d) The signature of the individual who is the subject of the
personal information or the individual who is legally empowered to grant
authority and the date signed.

(e) Notice of the length of time for which the authorization is
valid, that the individual may revoke the authorization at any time and
the procedure for making a revocation.

(2) An authorization is not valid for more than 24 months.

(3) An individual who is the subject of personal information may
revoke an authorization provided pursuant to this section at any time,
subject to the rights of any individual who acted in reliance on the
authorization prior to notice of the revocation.

(4) A licensee must retain the authorization of an individual or a
copy thereof in the record of the individual who is the subject of the
personal information.

(5) A disclosure authorization obtained by an insurer, insurance
producer or insurance-support organization from an individual prior to
January 1, 1983, is considered to be in compliance with this section.
[1981 c.649 §8; 2001 c.377 §27; 2003 c.87 §12; 2003 c.364 §157] (1) No insurer, insurance
producer or insurance-support organization may prepare or request an
investigative consumer report about an individual in connection with an
insurance transaction involving an application for insurance, a policy
renewal, a policy reinstatement or a change in insurance benefits unless
the insurer or insurance producer informs the individual:

(a) That the individual may request to be interviewed in connection
with the preparation of the investigative consumer report; and

(b) That upon a request pursuant to ORS 746.640, the individual is
entitled to receive a copy of the investigative consumer report.

(2) If an investigative consumer report is to be prepared by an
insurer or insurance producer, the insurer or insurance producer shall
institute reasonable procedures to conduct a personal interview requested
by the individual.

(3) If an investigative consumer report is to be prepared by an
insurance-support organization, the insurer or insurance producer
desiring the report shall inform the insurance-support organization
whether a personal interview has been requested by the individual. The
insurance-support organization shall institute reasonable procedures to
conduct such requested interviews. [1981 c.649 §9; 2003 c.364 §158] (1) If any
individual, after proper identification, submits a written request to an
insurer, insurance producer or insurance-support organization for access
to recorded personal information about the individual that is reasonably
described by the individual and reasonably locatable and retrievable by
the insurer, insurance producer or insurance-support organization, the
insurer, insurance producer or insurance-support organization within 30
business days from the date the request is received shall:

(a) Inform the individual of the nature and substance of the
recorded personal information in writing, by telephone or by other oral
communication, whichever the insurer, insurance producer or
insurance-support organization prefers;

(b) Permit the individual to see and copy, in person, the recorded
personal information or to obtain a copy of the recorded personal
information by mail, whichever the individual prefers, unless the
recorded personal information is in coded form, in which case an accurate
translation in plain language shall be provided in writing;

(c) Disclose to the individual the identity, if recorded, of the
persons to whom the insurer, insurance producer or insurance-support
organization has disclosed the recorded personal information within two
years prior to the request, and if such identity is not recorded, the
names of the insurers, insurance producers, insurance-support
organizations and other persons to whom such information is normally
disclosed; and

(d) Provide the individual with a summary of the procedures by
which the individual may request correction, amendment or deletion of
recorded personal information.

(2) Any personal information provided pursuant to this section must
identify the source of the information if the source is an institutional
source.

(3) If an individual requests individually identifiable health
information supplied by a health care provider, the insurer, insurance
producer or insurance-support organization shall provide the information,
including the identity of the health care provider either directly to the
individual or to a health care provider designated by the individual and
licensed to provide health care with respect to the condition to which
the information relates, whichever the insurer, insurance producer or
insurance-support organization prefers. If the insurer, insurance
producer or insurance-support organization elects to disclose the
information to a health care provider designated by the individual, the
insurer, insurance producer or insurance-support organization shall
notify the individual, at the time of the disclosure, that the insurer,
insurance producer or insurance-support organization has provided the
information to the health care provider.

(4) Except for personal information provided under ORS 746.650, an
insurer, insurance producer or insurance-support organization may charge
a reasonable fee to cover the costs incurred in providing a copy of
recorded personal information to an individual.

(5) The obligations imposed by this section upon an insurer or
insurance producer may be satisfied by another insurer or insurance
producer authorized to act on its behalf. With respect to the copying and
disclosure of recorded personal information pursuant to a request under
this section, an insurer, insurance producer or insurance-support
organization may make arrangements with an insurance-support organization
or a consumer reporting agency to copy and disclose recorded personal
information on its behalf.

(6) The rights granted to individuals by this section shall extend
to all natural persons to the extent personal information about them is
collected and maintained by an insurer, insurance producer or
insurance-support organization in connection with an insurance
transaction. The rights granted to all natural persons by this subsection
shall not extend to personal information about them that relates to and
is collected in connection with or in reasonable anticipation of a claim
or a civil or criminal proceeding involving them.

(7) For purposes of this section, the term “insurance-support
organization” does not include “consumer reporting agency.” [1981 c.649
§10; 2003 c.87 §13; 2003 c.364 §159a](1) Within 30 business days from the date of receipt of a
written request from an individual to correct, amend or delete any
recorded personal information about the individual within its possession,
an insurer, insurance producer or insurance-support organization shall
either:

(a) Correct, amend or delete the portion of the recorded personal
information in dispute; or

(b) Notify the individual of:

(A) Its refusal to make the correction, amendment or deletion;

(B) The reasons for the refusal; and

(C) The individual’s right to file a statement as provided in
subsection (3) of this section.

(2) If the insurer, insurance producer or insurance-support
organization corrects, amends or deletes recorded personal information in
accordance with subsection (1) of this section, the insurer, insurance
producer or insurance-support organization shall so notify the individual
in writing and furnish the correction, amendment or fact of deletion to:

(a) Each person specifically designated by the individual who may
have, within the preceding two years, received the recorded personal
information;

(b) Each insurance-support organization whose primary source of
personal information is insurers, if the insurance-support organization
has systematically received recorded personal information from the
insurer within the preceding seven years. However, the correction,
amendment or fact of deletion need not be furnished if the
insurance-support organization no longer maintains recorded personal
information about the individual; and

(c) Each insurance-support organization that furnished the recorded
personal information that has been corrected, amended or deleted.

(3) Whenever an individual disagrees with an insurer’s, insurance
producer’s or insurance-support organization’s refusal to correct, amend
or delete recorded personal information, the individual shall be
permitted to file with the insurer, insurance producer or
insurance-support organization:

(a) A concise statement setting forth what the individual thinks is
the correct, relevant or fair information; and

(b) A concise statement of the reasons why the individual disagrees
with the insurer’s, insurance producer’s or insurance-support
organization’s refusal to correct, amend or delete recorded personal
information.

(4) In the event an individual files either or both of the
statements described in subsection (3) of this section, the insurer,
insurance producer or insurance-support organization shall:

(a) File the statements with the disputed personal information and
provide a means by which anyone reviewing the disputed personal
information will be made aware of the individual’s statements and have
access to them;

(b) In any subsequent disclosure by the insurer, insurance producer
or insurance-support organization of the recorded personal information
that is the subject of the disagreement, clearly identify the matter or
matters in dispute and provide the individual’s statements along with the
recorded personal information being disclosed; and

(c) Furnish the statements to the persons and in the manner
specified in subsection (2) of this section.

(5) The rights granted to individuals by this section shall extend
to all natural persons to the extent information about them is collected
and maintained by an insurer, insurance producer or insurance-support
organization in connection with an insurance transaction. The rights
granted to all natural persons by this subsection shall not extend to
information about them that relates to and is collected in connection
with or in reasonable anticipation of a claim or a civil or criminal
proceeding involving them.

(6) For purposes of this section, the term “insurance-support
organization” does not include “consumer reporting agency.” [1981 c.649
§11; 2003 c.364 §160] (1) In the
event of an adverse underwriting decision, the insurer or insurance
producer responsible for the decision must:

(a) Either provide the consumer proposed for coverage with the
specific reason or reasons for the adverse underwriting decision in
writing or advise the consumer that upon written request the consumer may
receive the specific reason or reasons in writing; and

(b) Provide the consumer proposed for coverage with a summary of
the rights established under subsection (2) of this section and ORS
746.640 and 746.645.

(2) Upon receipt of a written request within 90 business days from
the date of the mailing of notice or other communication of an adverse
underwriting decision to a consumer proposed for coverage, the insurer or
insurance producer shall furnish to the consumer within 21 business days
from the date of receipt of the written request:

(a) The specific reason or reasons for the adverse underwriting
decision, in writing, if this information was not initially furnished in
writing pursuant to subsection (1) of this section;

(b) The specific items of personal information and privileged
information that support these reasons, subject to the following:

(A) The insurer or insurance producer is not required to furnish
specific items of privileged information if the insurer or insurance
producer has a reasonable suspicion, based upon specific information
available for review by the Director of the Department of Consumer and
Business Services, that the consumer proposed for coverage has engaged in
criminal activity, fraud, material misrepresentation or material
nondisclosure; and

(B) Specific items of individually identifiable health information
supplied by a health care provider shall be disclosed either directly to
the consumer about whom the information relates or to a health care
provider designated by the consumer and licensed to provide health care
with respect to the condition to which the information relates, whichever
the insurer or insurance producer prefers; and

(c) The names and addresses of the institutional sources that
supplied the specific items of information described in paragraph (b) of
this subsection. However, the identity of any health care provider must
be disclosed either directly to the consumer or to the designated health
care provider, whichever the insurer or insurance producer prefers.

(3) The obligations imposed by this section upon an insurer or
insurance producer may be satisfied by another insurer or insurance
producer authorized to act on its behalf.

(4) When an adverse underwriting decision results solely from an
oral request or inquiry, the explanation of reasons and summary of rights
required by subsection (1) of this section may be given orally.

(5) Notwithstanding subsection (1) of this section, when an adverse
underwriting decision is based in whole or in part on credit history or
insurance score, the insurer or insurance producer responsible for the
decision must provide the consumer proposed for coverage with the
specific reason or reasons for the adverse underwriting decision in
writing. The notice must include the following:

(a) A summary of no more than four of the most significant credit
reasons for the adverse underwriting decision, listed in decreasing order
of importance, that clearly identifies the specific credit history or
insurance score used to make the adverse underwriting decision. An
insurer or insurance producer may not use “poor credit history” or a
similar phrase as a reason for an adverse underwriting decision.

(b) The name, address and telephone number, including a toll-free
telephone number, of the consumer reporting agency that provided the
information for the consumer report.

(c) A statement that the consumer reporting agency used by the
insurer or insurance producer to obtain the credit history of the
consumer did not make the adverse underwriting decision and is unable to
provide the consumer with specific reasons why the insurer or insurance
producer made an adverse underwriting decision.

(d) Information on the right of the consumer:

(A) To obtain a free copy of the consumer’s consumer report from
the consumer reporting agency described in paragraph (b) of this
subsection, including the deadline, if any, for obtaining a copy; and

(B) To dispute the accuracy or completeness of any information in a
consumer report furnished by the consumer reporting agency.

(6) Notwithstanding subsection (1) of this section, an insurer or
insurance producer responsible for an adverse underwriting decision that
is based in whole or in part on credit history or insurance score must
provide the notice required by subsection (5) of this section only when
the insurer or insurance producer makes the initial adverse underwriting
decision regarding a consumer.

(7) Notwithstanding subsection (1) of this section, when an adverse
underwriting decision relating to homeowner insurance is based in whole
or in part on a loss history report, the insurer or insurance producer
responsible for the decision must provide the consumer proposed for
coverage with the specific reason or reasons for the adverse underwriting
decision in writing. The notice must include the following:

(a) A description of a specific claim or claims that are the basis
for the specific loss history report used to make the adverse
underwriting decision.

(b) The name, address and telephone number, including a toll-free
telephone number, of the consumer reporting agency that provided the
information for the loss history report.

(c) A statement that the consumer reporting agency used by the
insurer or insurance producer to obtain the loss history report of the
consumer did not make the adverse underwriting decision and is unable to
provide the consumer with specific reasons why the insurer or insurance
producer made an adverse underwriting decision.

(d) Information on the right of the consumer:

(A) To obtain a free copy of the consumer’s loss history report
from the consumer reporting agency described in paragraph (b) of this
subsection, including the deadline, if any, for obtaining a copy; and

(B) To dispute the accuracy or completeness of any information in a
loss history report furnished by the consumer reporting agency.

(8) When an adverse underwriting decision relating to homeowner
insurance is based in part on credit history and in part on a loss
history report, the insurer or insurance producer responsible for the
adverse underwriting decision may provide the notices required by
subsections (5) and (7) of this section in a single notice. [1981 c.649
§12; 2003 c.87 §15; 2003 c.364 §161; 2003 c.788 §2a; 2005 c.489 §7]No insurer, insurance producer or insurance-support
organization may seek information in connection with an insurance
transaction concerning any previous adverse underwriting decision
experienced by an individual, or any previous insurance coverage obtained
by an individual through a residual market mechanism, unless the inquiry
also requests the reasons for any previous adverse underwriting decision
or the reasons why insurance coverage was previously obtained through a
residual market mechanism. [1981 c.649 §13; 2003 c.364 §162]No insurer or insurance producer may base an adverse
underwriting decision in whole or in part on:

(1) The fact of a previous adverse underwriting decision or on the
fact that an individual previously obtained insurance coverage through a
residual market mechanism. However, an insurer or insurance producer may
base an adverse underwriting decision on further information obtained
from an insurer or insurance producer responsible for a previous adverse
underwriting decision.

(2) Personal information received from an insurance-support
organization whose primary source of information is insurers. However, an
insurer or insurance producer may base an adverse underwriting decision
on further personal information obtained as the result of information
received from such an insurance-support organization. [1981 c.649 §14;
2003 c.364 §163] (1) An insurer
that issues personal insurance policies in this state:

(a) May not cancel or nonrenew 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.

(b) 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.

(c) May not use the following types of credit history to decline
coverage of personal insurance, calculate an insurance score or determine
personal insurance premiums or rates:

(A) The absence of credit history or the inability to determine the
consumer’s credit history, if the insurer has received accurate and
complete information from the consumer, unless the insurer does one of
the following:

(i) If the insurer presents information that the absence of credit
history or the inability to determine the consumer’s credit history
relates to the risk for the insurer, uses the absence of a credit history
or inability to determine a consumer’s credit history as allowed by rules
adopted by the Director of the Department of Consumer and Business
Services;

(ii) Treats the consumer as if the applicant or insured has neutral
credit history, as defined by the insurer; or

(iii) Excludes the use of credit information as a factor and uses
only other underwriting criteria.

(B) Credit inquiries not initiated by the consumer or inquiries
requested by the consumer for the consumer’s own credit information.

(C) Inquiries identified on a consumer’s credit report relating to
insurance coverage.

(D) Multiple lender inquiries identified as being from the home
mortgage industry and made within 30 days of one another, unless only one
inquiry is considered.

(E) Multiple lender inquiries identified as being from the
automobile lending industry and made within 30 days of one another,
unless only one inquiry is considered.

(F) The consumer’s total available line of credit. However, an
insurer may consider the total amount of outstanding debt in relation to
the total available line of credit.

(d) May not rerate an existing policy or rerate a customer based on
a customer’s credit history or the credit history component of a
customer’s insurance score when the marital status of the customer
changes due to death or divorce.

(2) If an insurer assigns a consumer to a less favorable rating
category for a policy of personal insurance based in whole or in part on
the consumer’s credit history or insurance score, the consumer may
request, no more than once annually, that the insurer rerate the consumer
according to the standards that the insurer would apply to the consumer
if the consumer were initially applying for the same personal insurance.

(3) If an insurer uses disputed credit history to determine
eligibility for coverage of personal insurance and places a consumer with
an affiliate that charges higher premiums or offers less favorable policy
terms:

(a) The insurer shall rerate the policy retroactive to the
effective date of the current policy term; and

(b) The policy, as reissued or rerated, shall provide the premiums
and policy terms for which the consumer would have been eligible if
accurate credit history had been used to determine eligibility.

(4) If an insurer charges higher premiums due to disputed credit
history, the insurer shall rerate the policy retroactive to the effective
date of the current policy term. As rerated, the insurer shall charge the
consumer the same premiums the consumer would have been charged if
accurate credit history had been used to calculate an insurance score.

(5) Subsections (3) and (4) of this section apply only if the
consumer resolves the credit dispute under the process set forth in the
federal Fair Credit Reporting Act (15 U.S.C. 1681) and notifies the
insurer in writing that the dispute has been resolved.

(6) Except as provided in subsections (2), (3) and (4) of this
section, an insurer may only use rating factors other than credit history
or insurance score to rerate the policy at renewal. [2003 c.788 §4; 2005
c.464 §1] (1) An insurer may not
use credit history to determine personal insurance eligibility, premiums
or rates for coverage unless the insurer has filed the insurance scoring
models used by the insurer with the Director of the Department of
Consumer and Business Services. An insurance scoring model includes all
attributes and factors used in the calculation of an insurance score.

(2) Insurance scoring models filed with the director under
subsection (1) of this section are confidential and not subject to
disclosure under ORS 192.410 to 192.505. [2003 c.788 §5](1) An insurer that issues
personal insurance policies in this state may not cancel or nonrenew a
policy of personal insurance based in whole or in part on a consumer’s
credit history or insurance score.

(2) If, prior to January 1, 2004, an insurer has assigned a
consumer to a less favorable rating category for a policy of personal
insurance based in whole or in part on the consumer’s credit history or
insurance score, the consumer may request, no more than once annually,
that the insurer rerate the consumer according to the standards that the
insurer would apply to the consumer if the consumer were initially
applying for the same personal insurance on or after January 1, 2004.

(3) An insurer that receives a request under subsection (2) of this
section may not consider that the consumer was assigned to a less
favorable rate category when the insurer rerates the consumer.

(4) If an insurer uses disputed credit history to determine
eligibility for coverage of personal insurance and places a consumer with
an affiliate that charges higher premiums or offers less favorable policy
terms:

(a) The insurer shall rerate the policy retroactive to the
effective date of the current policy term; and

(b) The policy, as reissued or rerated, shall provide the premiums
and policy terms for which the consumer would have been eligible if
accurate credit history had been used to determine eligibility.

(5) If an insurer charges higher premiums due to disputed credit
history, the insurer shall rerate the policy retroactive to the effective
date of the current policy term. As rerated, the insurer shall charge the
consumer the same premiums the consumer would have been charged if
accurate credit history had been used to calculate an insurance score.

(6) Subsections (4) and (5) of this section apply only if the
consumer resolves the credit dispute under the process set forth in the
federal Fair Credit Reporting Act (15 U.S.C. 1681) and notifies the
insurer in writing that the dispute has been resolved.

(7) Except as provided in subsections (2), (4) and (5) of this
section, an insurer may only use rating factors other than credit history
or insurance score to rerate the policy at renewal. [2003 c.788 §7](1) A licensee or insurance-support organization may not
disclose any personal or privileged information about an individual
collected or received in connection with an insurance transaction unless
the disclosure meets one or more of the following conditions:

(a) Is with the written authorization of the individual, and:

(A) If the authorization is submitted by another licensee or
insurance-support organization, the authorization meets the requirements
of ORS 746.630; or

(B) If the authorization is submitted by a person other than a
licensee or insurance-support organization, the authorization is:

(i) Dated;

(ii) Signed by the individual; and

(iii) Obtained one year or less prior to the date a disclosure is
sought pursuant to this subsection.

(b) Is to a person other than a licensee or insurance-support
organization, if the disclosure is reasonably necessary to enable the
person to:

(A) Perform a business, professional or insurance function for the
disclosing licensee or insurance-support organization and the person
agrees not to disclose the information further without the individual’s
written authorization unless the further disclosure:

(i) Would otherwise be permitted by this section if made by a
licensee or insurance-support organization; or

(ii) Is reasonably necessary for the person to perform its function
for the disclosing licensee or insurance-support organization; or

(B) Provide information to the disclosing licensee or
insurance-support organization for the purpose of:

(i) Determining an individual’s eligibility for an insurance
benefit or payment; or

(ii) Detecting or preventing criminal activity, fraud, material
misrepresentation or material nondisclosure in connection with an
insurance transaction.

(c) Is to a licensee, insurance-support organization or
self-insurer, if the information disclosed is limited to that which is
reasonably necessary:

(A) To detect or prevent criminal activity, fraud, material
misrepresentation or material nondisclosure in connection with insurance
transactions; or

(B) For either the disclosing or receiving licensee or
insurance-support organization to perform its function in connection with
an insurance transaction involving the individual.

(d) Is to a health care provider and discloses only such
information as is reasonably necessary to accomplish one or more of the
following purposes:

(A) Verifying insurance coverage or benefits.

(B) Informing an individual of a medical problem of which the
individual may not be aware.

(C) Conducting an operations or services audit.

(e) Is to an insurance regulatory authority.

(f) Is to a law enforcement or other governmental authority:

(A) To protect the interests of the licensee or insurance-support
organization in preventing or prosecuting the perpetration of fraud upon
it; or

(B) If the licensee or insurance-support organization reasonably
believes that illegal activities have been conducted by the individual.

(g) Is otherwise permitted or required by law.

(h) Is in response to a facially valid administrative or judicial
order, including a search warrant or subpoena.

(i) Is made for the purpose of conducting actuarial or research
studies, if:

(A) No individual may be identified in any resulting actuarial or
research report;

(B) Materials allowing the individual to be identified are returned
or destroyed as soon as they are no longer needed; and

(C) The actuarial or research organization agrees not to disclose
the information unless the disclosure would otherwise be permitted by
this section if made by a licensee or insurance-support organization.

(j) Is to a party or a representative of a party to a proposed or
consummated sale, transfer, merger or consolidation of all or part of the
business of the licensee or insurance-support organization, if:

(A) Prior to the consummation of the sale, transfer, merger or
consolidation only such information is disclosed as is reasonably
necessary to enable the recipient to make business decisions about the
purchase, transfer, merger or consolidation; and

(B) The recipient agrees not to disclose the information unless the
disclosure would otherwise be permitted by this section if made by a
licensee or insurance-support organization.

(k) Is to a nonaffiliated third party whose only use of the
information will be in connection with the marketing of a product or
service, if all of the following conditions are met:

(A) No privileged information or personal information is disclosed,
and no classification derived from such information may be disclosed.

(B) The individual must have been given the notice described in ORS
746.620 and an opportunity to indicate that the individual does not want
personal information disclosed for marketing purposes and must have given
no indication that the individual does not want the information
disclosed. The individual need not have been given the opportunity
described in this subparagraph if the disclosure is made pursuant to a
joint marketing agreement. As used in this subparagraph, “joint marketing
agreement” means a formal written contract pursuant to which an insurer
jointly offers, endorses or sponsors a financial product or service with
a financial institution. When the opportunity is required, the statement
that offers the opportunity must state that the insurer may disclose
personal information to nonaffiliates and that the individual has a right
to indicate that the individual does not want personal information
disclosed for marketing purposes, and must describe the method for
exercising that right. The statement must be in writing but may be in an
electronic form if the individual agrees. The individual who is given the
opportunity must be provided a reasonable time to exercise the
opportunity. An individual may exercise the opportunity at any time. A
statement by an individual barring disclosure of personal information
remains effective until the individual who made the statement revokes the
statement in writing or, if the individual agrees, in electronic form.

(C) The person receiving the information must agree not to use it
except in connection with the marketing of a product or service.

(L) Is to an affiliate whose only use of the information will be in
connection with an audit of the licensee or the marketing of a financial
product or service, and the affiliate agrees not to disclose the
information for any other purpose or to unaffiliated persons. This
paragraph does not apply to the disclosure of individually identifiable
health information for the purpose of marketing a financial product or
service.

(m) Is by a consumer reporting agency, and the disclosure is to a
person other than a licensee.

(n) Is to a group policyholder for the purpose of reporting claims
experience or conducting an audit of the licensee’s operations or
services, and the information disclosed is reasonably necessary for the
group policyholder to conduct the review or audit.

(o) Is to a professional peer review organization for the purpose
of reviewing the service or conduct of a health care provider.

(p) Is to a governmental authority for the purpose of determining
the individual’s eligibility for health benefits for which the
governmental authority may be liable.

(q) Is to a policyholder or certificate holder for the purpose of
providing information regarding the status of an insurance transaction.

(2) Personal or privileged information may be acquired by a group
practice prepayment health care service contractor from providers which
contract with the contractor and may be transferred among providers which
contract with the contractor for the purpose of administering plans
offered by the contractor. The information may not be disclosed otherwise
by the contractor except in accordance with ORS 746.600 to 746.690. [1981
c.649 §15; 1987 c.490 §53; 2001 c.377 §28; 2003 c.87 §14]Nothing in ORS 746.620, 746.630 or 746.665 may
be construed to modify, limit or supersede the operation of the federal
Fair Credit Reporting Act (15 U.S.C. 1681 et seq.) and no inference may
be drawn on the basis of ORS 746.620, 746.630 or 746.665 regarding
whether personal information is transaction information or experience
information under section 603 of the federal Fair Credit Reporting Act
(15 U.S.C. 1681 et seq.). [2001 c.377 §28c; 2003 c.87 §16] (1) The Director of the Department of
Consumer and Business Services may examine and investigate into the
affairs of any insurer or insurance producer transacting insurance in
this state to determine whether it has been or is engaged in any conduct
in violation of ORS 746.600 to 746.690.

(2) The director may examine and investigate into the affairs of
any insurance-support organization acting on behalf of an insurer or
insurance producer which either transacts insurance in this state or
transacts insurance outside this state which has an effect on a person
residing in this state, in order to determine whether the
insurance-support organization has been or is engaged in any conduct in
violation of ORS 746.600 to 746.690. [1981 c.649 §16; 1987 c.490 §54;
2003 c.87 §17; 2003 c.364 §164]For the purpose of ORS 746.600 to 746.690 and 750.055, an
insurance-support organization transacting business outside this state
which has an effect on a person residing in this state shall be
considered to have appointed the Director of the Department of Consumer
and Business Services to accept service of process on its behalf. Notice
of such service shall be given forthwith by the director as provided for
orders and notices under ORS 731.248 (3). [1981 c.649 §17; 1987 c.490 §55] (1) A person whose rights granted under ORS
746.607 (7), 746.640, 746.645 or 746.650 are violated may apply to the
circuit court for the county in which the person resides, or any other
court of competent jurisdiction, for appropriate equitable relief if an
insurer, insurance producer or insurance-support organization fails to
comply with ORS 746.607 (7), 746.640, 746.645 or 746.650.

(2) A licensee or insurance-support organization that discloses
information in violation of ORS 746.665 or a health insurer that uses or
discloses information in violation of ORS 746.607 (1) or (2) is liable
for damages sustained by the individual about whom the information
relates. However, an individual is not entitled to a monetary award that
exceeds the actual damages sustained by the individual as a result of the
violation of ORS 746.607 (1) or (2) or 746.665.

(3) In any action brought pursuant to this section, the court may
award the cost of the action and reasonable attorney fees to the
prevailing party.

(4) An action under this section must be brought within two years
from the date the alleged violation is or should have been discovered.

(5) Except as specifically provided in this section, there shall be
no remedy or recovery available to individuals, in law or in equity, for
occurrences constituting a violation of any provision of ORS 746.600 to
746.690. [1981 c.649 §18; 1987 c.490 §56; 1995 c.618 §131; 2001 c.377
§28a; 2003 c.87 §18; 2003 c.364 §165a] No cause of action
in the nature of defamation, invasion of privacy or negligence shall
arise against any person for disclosing personal or privileged
information in accordance with ORS 746.600 to 746.690 and 750.055, nor
shall such a cause of action arise against any person for furnishing
personal or privileged information to an insurer, insurance producer or
insurance-support organization. However, this section shall provide no
immunity for disclosing or furnishing false information with malice or
willful intent to injure any person. [1981 c.649 §19; 1987 c.490 §57;
2003 c.364 §166](1) When a consumer applies for
a homeowner insurance policy, an insurer may not use:

(a) A prior claim of the consumer or a claim relating to the
property to be insured, when the date of loss of the claim is more than
five years preceding the date of application, to determine whether to
issue the policy or to determine rates or other terms and conditions of
the policy. This paragraph does not apply when the insurer uses claim
experience of the consumer or of the property to provide a discount to
the consumer.

(b) The first claim that the consumer made on a homeowner insurance
policy within the five-year period immediately preceding the date of
application to determine whether to issue the policy.

(c) A prior claim relating to the property to be insured that
occurred prior to purchase of the property by the consumer, when the
consumer demonstrates to the insurer’s satisfaction that the risk
associated with damage resulting from the accident or occurrence that
gave rise to the prior claim has been mitigated, to determine whether to
issue the policy or to determine rates or other terms and conditions of
the policy. For purposes of this paragraph, a risk is mitigated if the
consumer has fully restored the damaged property and has repaired,
replaced, restored or eliminated the condition, system or use of the
property that was the underlying cause of the loss.

(2) When renewing a homeowner insurance policy, an insurer may not
use:

(a) A prior claim of the consumer or a claim relating to the
property to be insured, when the date of loss of the claim is more than
five years before the upcoming renewal date, to determine whether to
renew the policy or to determine rates or other terms and conditions of
the policy. This paragraph does not apply when the insurer uses claim
experience of the consumer or of the property to provide a discount to
the consumer at renewal.

(b) The first claim of the consumer made within the five-year
period immediately preceding the upcoming renewal date to determine
whether to renew the policy.

(3) An insurer or insurance producer may not use an inquiry made by
any means by the consumer to the insurer or to an insurance producer
regarding the terms, conditions or coverage of an insurance policy,
including an inquiry about an actual loss or claim filing process, to
determine whether to issue or renew a policy or to determine rates or
other terms and conditions of a policy if the consumer is not making a
claim as part of the inquiry. An insurer or insurance producer may verify
whether the consumer is making a claim as part of the inquiry. If the
consumer affirms that the inquiry is not a claim, the insurer or
insurance producer may rely on the affirmation to rebut a later assertion
to the contrary. This subsection does not apply to an inquiry by a
consumer relating to the possibility of a third party claim against the
consumer. The Director of the Department of Consumer and Business
Services may adopt rules establishing procedures to implement this
subsection.

(4) This section does not prohibit an insurer from taking any
underwriting or rating action that is:

(a) Based on the known condition or use of the property;

(b) Based on fraudulent acts of the consumer; or

(c) Otherwise allowed by law. [2005 c.489 §4] (1) Except as
provided in subsection (6) of this section, an insurer may cancel a
homeowner insurance policy before the expiration of the policy only for
one or more of the following reasons:

(a) Nonpayment of premium;

(b) Fraud or material misrepresentation affecting the policy or in
the presentation of a claim under the policy;

(c) Violation of any of the terms and conditions of the policy;

(d) Substantial increase in the risk of loss after insurance
coverage has been issued or renewed, including but not limited to an
increase in exposure due to rules, legislation or court decision; or

(e) Determination by the Director of the Department of Consumer and
Business Services that the continuation of a line of insurance or class
of business to which the policy belongs will jeopardize an insurer’s
solvency or place the insurer in violation of the insurance laws of
Oregon or any other state, whether because of a loss or decrease in
reinsurance covering the risk or other reason determined by the director.

(2) The insurer shall give the policyholder written notice of the
cancellation, including the effective date of the cancellation and the
reasons for the cancellation.

(3) The insurer must mail or deliver a notice of cancellation to
the policyholder at the address shown in the policy:

(a) At least 10 days prior to the effective date of cancellation,
if the cancellation is for the reason described in subsection (1)(a) or
(b) of this section.

(b) At least 30 days prior to the effective date of cancellation,
if the cancellation is for the reason described in subsection (1)(c), (d)
or (e) of this section.

(4) An insurer shall mail or deliver to a policyholder, at the
address shown in the policy, a notice of renewal or nonrenewal of a
homeowner insurance policy at least 30 days prior to the expiration of
the policy period. This subsection does not apply when the policy is in
lapse status under the terms of the policy.

(5) Proof of mailing notice of cancellation or nonrenewal to the
policyholder at the address shown in the policy is sufficient proof of
notice under this section.

(6) This section does not apply to a homeowner insurance policy
that has been in effect fewer than 60 days at the time the notice of
cancellation is mailed or delivered by the insurer unless it is a renewal
policy. An insurer may not use the fact that a claim was filed on the
policy within the 60-day period as a basis for canceling the policy
within the 60-day period, for increasing the premium rate or for altering
the terms of the policy during the current policy term. An insurer may,
within the 60-day period, use any other information consistent with the
insurer’s rating or underwriting program, including but not limited to,
conditions or uses of the property discovered by the insurer, as a basis
for cancellation or for offering to continue coverage at an increased
rate or on different terms. At renewal of the policy, the insurer may
treat a claim that occurred within the 60-day period the same as any
other claim occurring during the policy period for the purposes of
rating, nonrenewing and altering the terms of the policy. [2005 c.489 §5] (1) An
insurer or insurance producer shall notify a consumer that the insurer or
insurance producer will request a loss history report relating to the
consumer or property to be insured before the insurer or insurance
producer may obtain the report. The notice may be oral, in writing or in
the same medium as the medium in which previous communication between the
consumer and the insurer or insurance producer has been conducted.

(2) An insurance producer may provide a single notice under
subsection (1) of this section to a consumer if the insurance producer
makes loss history inquiries of one or more insurers in response to a
request by the consumer relating to a homeowner insurance policy.

(3) An insurer that uses loss history reports for underwriting or
rating homeowner insurance shall instruct the insurer’s insurance
producers that an insurance producer must notify the consumer that the
insurance producer has requested a loss history report before the
insurance producer may obtain the report.

(4) An insurer that uses a loss history report of a consumer when
considering an application for a homeowner insurance policy shall notify
the consumer during the application process that the consumer may request
a free copy of the loss history report from the consumer reporting agency
and a written statement describing the insurer’s use of the report. The
notice to the applicant may be in writing or in the same medium as the
medium in which the application is made. The written statement must
contain the following explanations:

(a) The ways in which the insurer uses loss history reports;

(b) How often the insurer reviews a consumer’s loss history report;
and

(c) The procedures a consumer may use to obtain additional
information. [2005 c.489 §6] No
person shall knowingly and willfully obtain information about an
individual from an insurer, insurance producer or insurance-support
organization under false pretenses. [1981 c.649 §20; 2003 c.364 §167]PENALTIESViolation of ORS 746.280 to 746.292 is a Class D
violation. [1977 c.785 §8; 1999 c.1051 §221]Note: See note under 746.275.

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