71st OREGON LEGISLATIVE ASSEMBLY--2001 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 3477
A-Engrossed
House Bill 3126
Ordered by the House May 4
Including House Amendments dated May 4
Sponsored by Representative WITT
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure.
{ - Allows insurer or agent to charge commission or service
fee when transacting certain types of insurance. - } { + Allows
group life or health insurance coverage to be offered to expanded
types of groups if Director of Department of Consumer and
Business Services makes specified findings.
Declares emergency, effective on passage. + }
A BILL FOR AN ACT
Relating to insurance; creating new provisions; amending ORS
731.486, 743.522, 743.524 and 743.526; and declaring an
emergency.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 731.486 is amended to read:
731.486. (1) The exemption in ORS 731.146 (2)(b) does not apply
to an insurer that offers coverage under a group health insurance
policy or a group life insurance policy in this state unless the
Director of the Department of Consumer and Business Services
determines that the exemption applies.
(2) The insurer shall submit evidence to the director that the
exemption applies. When a master policy is delivered or issued
for delivery outside this state to trustees of a fund for two or
more employers, for one or more labor unions, for one or more
employers and one or more labor unions or for an association, the
insurer shall also submit evidence showing compliance with:
(a) ORS 743.526, for a policy of group health insurance; or
(b) ORS 743.354, for a policy of group life insurance.
(3) The director shall review the evidence submitted and may
request additional evidence as needed.
(4) An insurer shall submit to the director any changes in
{ + + } the evidence submitted under subsection (2) of this
section.
(5) The director may order an insurer to cease offering a
policy or coverage under a policy if the director determines that
the exemption under ORS 731.146 (2)(b) is no longer satisfied.
{ + (6) Coverage under a master group life or health
insurance policy delivered or issued for delivery outside this
state that does not qualify for the exemption in ORS 731.146
(2)(b) may be offered in this state if the director determines
that the state in which the policy was delivered or issued for
delivery has requirements that are substantially similar to those
established under section 3 of this 2001 Act or ORS 743.522 (2)
and that the policy satisfies those requirements. + }
{ - (6) - } { + (7) + }This section does not apply to any
master policy issued to a multistate employer or labor union.
{ - (7) - } { + (8) + } The director may adopt rules to
carry out this section.
SECTION 2. { + Section 3 of this 2001 Act is added to and made
a part of ORS chapter 743. + }
SECTION 3. { + (1) Group life insurance coverage offered to a
resident in this state under a group life insurance policy issued
to a group other than one described in ORS 743.351 or 743.354 may
be delivered if:
(a) The Director of the Department of Consumer and Business
Services finds that:
(A) The issuance of the policy is in the best interest of the
public;
(B) The issuance of the policy would result in economies of
acquisition or administration; and
(C) The benefits are reasonable in relation to the premiums
charged;
(b) The premium for the policy is paid either from funds of a
policyholder, from funds contributed by a covered person or from
both; and
(c) An insurer has the discretion to exclude or limit coverage
for a voluntary plan on any person for whom evidence of
individual insurability is not satisfactory to the insurer.
(2) The requirements of ORS 743.303 do not apply to a policy
authorized under subsection (1) of this section. + }
SECTION 4. ORS 743.522 is amended to read:
743.522. { + (1) + } 'Group health insurance' means that form
of health insurance covering groups of persons { - as
defined - } { + described + } in this section, with or without
one or more members of their families or one or more of their
dependents, or covering one or more members of the families or
one or more dependents of such groups of persons, and issued upon
one of the following bases:
{ - (1) - } { + (a) + } Under a policy issued to an
employer or trustees of a fund established by an employer, who
shall be deemed the policyholder, insuring employees of such
employer for the benefit of persons other than the employer. The
term 'employees' as used in this { - subsection - }
{ + paragraph + } shall be deemed to include the officers,
managers, and employees of the employer, the individual
proprietor or partners if the employer is an individual
proprietor or partnership, the officers, managers, and employees
of subsidiary or affiliated corporations, the individual
proprietors, partners and employees of individuals and firms, if
the business of the employer and such individual or firm is under
common control through stock ownership, contract, or otherwise.
The term ' employees' as used in this { - subsection - }
{ + paragraph + } may include retired employees. A policy issued
to insure employees of a public body may provide that the term
'employees' shall include elected or appointed officials. The
policy may provide that the term ' employees' shall include the
trustees or their employees, or both, if their duties are
principally connected with such trusteeship.
{ - (2) - } { + (b) + } Under a policy issued to an
association, including a labor union, which has an active
existence for at least one year, which has a constitution and
bylaws and which has been organized and is maintained in good
faith primarily for purposes other than that of obtaining
insurance, which shall be deemed the policyholder, insuring
members, employees, or employees of members of the association
for the benefit of persons other than the association or its
officers or trustees. The term 'employees' as used in this
{ - subsection - } { + paragraph + } may include retired
employees.
{ - (3) - } { + (c) + } Under a policy issued to the
trustees of a fund established by two or more employers in the
same or related industry or by one or more labor unions or by one
or more employers and one or more labor unions or by an
association as
{ - defined in subsection (2) of this section - } { +
described in paragraph (b) of this subsection + }, insuring
employees of the employers or members of the unions or of such
association, or employees of members of such association for the
benefit of persons other than the employers or the unions or such
association. The term ' employees' as used in this
{ - subsection - } { + paragraph + } may include the officers,
managers and employees of the employer, and the individual
proprietor or partners if the employer is an individual
proprietor or partnership. The term 'employees' as used in this
{ - subsection - } { + paragraph + } may include retired
employees. The policy may provide that the term 'employees' shall
include the trustees or their employees, or both, if their duties
are principally connected with such trusteeship.
{ - (4) - } { + (d) + } Under a policy issued to any person
or organization to which a policy of group life insurance may be
issued or delivered in this state, to insure any class or classes
of individuals that could be insured under such group life
policy.
{ - (5) Under a policy issued to cover any other
substantially similar group which, in the discretion of the
Director of the Department of Consumer and Business Services, may
be subject to the issuance of a group health insurance
policy. - }
{ + (2) Group health insurance offered to a resident of this
state under a group health insurance policy issued to a group
other than one described in subsection (1) of this section may be
delivered if:
(a) The Director of the Department of Consumer and Business
Services finds that:
(A) The issuance of the policy is in the best interest of the
public;
(B) The issuance of the policy would result in economics of
acquisition or administration; and
(C) The benefits are reasonable in relation to the premiums
charged; and
(b) The premium for the policy is paid either from funds of a
policyholder, from funds contributed by a covered person or from
both. + }
SECTION 5. ORS 743.524 is amended to read:
743.524. (1) An insurer shall not offer a policy of group
health insurance to an association as the policyholder or offer
coverage under such a policy, whether issued in this or another
state, unless the Director of the Department of Consumer and
Business Services determines that the association satisfies the
requirements of an association under ORS 743.522 { - (2) - }
{ + (1)(b) + }.
(2) An insurer shall submit evidence to the director that the
association satisfies the requirements under ORS 743.522
{ - (2) - } { + (1)(b) + }. The director shall review the
evidence and may request additional evidence as needed.
(3) An insurer shall submit to the director any changes in the
evidence submitted under subsection (2) of this section.
(4) The director may order an insurer to cease offering health
insurance to an association if the director determines that the
association does not meet the standards under ORS 743.522
{ - (2) - } { + (1)(b) + }.
(5) The director may adopt rules to carry out this section.
SECTION 6. ORS 743.526 is amended to read:
743.526. (1) An insurer shall not offer a policy of group
health insurance described in ORS 743.522 { - (3) - }
{ + (1)(c) + } that insures persons in this state or offer
coverage under such a policy, whether the policy is to be issued
in this or another state, unless the Director of the Department
of Consumer and Business Services determines that the
requirements of this section and ORS 743.522 { - (3) - }
{ + (1)(c) + } are satisfied.
(2) The director shall determine with respect to a policy
whether the trustees are the policyholder. If the director
determines that the trustees are the policyholder and if the
policy is issued or proposed to be issued in this state, the
policy is subject to the Insurance Code. If the director
determines that the trustees are not the policyholder, the
evidence of coverage that is issued or proposed to be issued in
this state to a participating employer, labor union or
association shall be deemed to be a group health insurance policy
subject to the provisions of the Insurance Code. The director may
determine that the trustees are not the policyholder if:
(a) The evidence of coverage issued or proposed to be issued to
a participating employer, labor union or association is in fact
the primary statement of coverage for the employer, labor union
or association; and
(b) The trust arrangement is under the actual control of the
insurer.
(3) An insurer shall submit evidence to the director showing
that the requirements of subsection (2) of this section and ORS
743.522 { - (3) - } { + (1)(c) + } are satisfied. The
director shall review the evidence and may request additional
evidence as needed.
(4) An insurer shall submit to the director any changes in the
evidence submitted under subsection (3) of this section.
(5) The director may adopt rules to carry out this section.
SECTION 7. { + This 2001 Act being necessary for the immediate
preservation of the public peace, health and safety, an emergency
is declared to exist, and this 2001 Act takes effect on its
passage. + }
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