Chapter 826
AN ACT
SB 989
Relating to public bodies exempt from Insurance Code; amending ORS
731.036; and declaring an emergency.
Be It Enacted by the People of
the State of
SECTION 1. ORS 731.036 is amended to read:
731.036. The Insurance
Code does not apply to any of the following to the extent of the subject matter
of the exemption:
(1) A bail bondsman,
other than a corporate surety and its agents.
(2) A fraternal benefit
society that has maintained lodges in this state and other states for 50 years
prior to January 1, 1961, and for which a certificate of authority was not
required on that date.
(3) A religious
organization providing insurance benefits only to its employees, which
organization is in existence and exempt from taxation under section 501(c)(3) of the federal Internal Revenue Code on September 13,
1975.
(4) Public bodies, as
defined in ORS 30.260, that either individually or jointly establish
a self-insurance program for tort liability in accordance with ORS 30.282.
(5) Public bodies, as
defined in ORS 30.260, that either individually or jointly establish
a self-insurance program for property damage in accordance with ORS 30.282.
(6) Cities, counties,
school districts, community college districts, community college service
districts or districts, as defined in ORS 198.010 and 198.180, that either
individually or jointly insure for health insurance coverage, excluding
disability insurance, their employees or retired employees, or their
dependents, or students engaged in school activities, or combination of
employees and dependents, with or without employee or student contributions, if
all of the following conditions are met:
(a) The individual or
jointly self-insured program meets the following minimum requirements:
(A) In the case of a
school district, community college district or community college service
district, the number of covered employees and dependents and retired
employees and dependents aggregates at least [1,000] 500 individuals;
(B) In the case of an
individual public body program other than a school district, community college
district or community college service district, the number of covered employees
and dependents and retired employees and dependents aggregates at
least 500 individuals; and
(C) In the case of a
joint program of two or more public bodies, the number of covered employees and
dependents and retired employees and dependents aggregates at least
1,000 individuals;[, or the annual
contributions to the program aggregate at least $500,000;]
(b) The individual or
jointly self-insured health insurance program includes all coverages and
benefits required of group health insurance policies under ORS chapter 743;
(c) The individual or
jointly self-insured program must have program documents that define program
benefits and administration;
(d) Enrollees must be
provided copies of summary plan descriptions including:
(A) Written general
information about services provided, access to services, charges and scheduling
applicable to each enrollee’s coverage;
(B) The program’s
grievance and appeal process; and
(C) Other group health
plan enrollee rights, disclosure or written procedure requirements established
under ORS chapter 743;
(e) The financial
administration of an individual or jointly self-insured program must include
the following requirements:
(A) Program
contributions and reserves must be held in separate accounts and used for the
exclusive benefit of the program;
(B) The program must
maintain adequate reserves. Reserves may be invested in accordance with the
provisions of ORS chapter 293. Reserve adequacy must be calculated annually
with proper actuarial calculations including the following:
(i) Known claims, paid
and outstanding;
(ii) A history of
incurred but not reported claims;
(iii)
Claims handling expenses;
(iv)
Unearned contributions; and
(v) A claims trend
factor; and
(C) The program must
maintain adequate reinsurance against the risk of economic loss in accordance
with the provisions of ORS 742.065 unless the program has received written
approval for an alternative arrangement for protection against economic loss
from the Director of the Department of Consumer and Business Services;
(f) The individual or
jointly self-insured program must have sufficient personnel to service the
employee benefit program or must contract with a third party administrator
licensed under ORS chapter 744 as a third party administrator to provide such
services;
(g) The individual or
jointly self-insured program shall be subject to assessment in accordance with
ORS 735.614 and former enrollees shall be eligible for portability coverage in
accordance with ORS 735.616;
(h) The public body, or
the program administrator in the case of a joint insurance program of two or
more public bodies, files with the Director of the Department of Consumer and
Business Services copies of all documents creating and governing the program,
all forms used to communicate the coverage to beneficiaries, the schedule of
payments established to support the program and, annually, a financial report
showing the total incurred cost of the program for the preceding year. A copy
of the annual audit required by ORS 297.425 may be used to satisfy the
financial report filing requirement; and
(i) Each public body in
a joint insurance program is liable only to its own employees and no others for
benefits under the program in the event, and to the extent, that no further
funds, including funds from insurance policies obtained by the pool, are
available in the joint insurance pool.
(7) All ambulance
services.
(8) A person providing
either or both of the services described in this subsection in connection with
motor vehicles. The exemption under this subsection does not apply to an
authorized insurer providing such services under an insurance policy. This
subsection applies to the following services:
(a) Towing service.
(b) Emergency road
service, which means adjustment, repair or replacement of the equipment, tires
or mechanical parts of a motor vehicle in order to permit the motor vehicle to
be operated under its own power.
(9)(a) A person
described in this subsection who, in an agreement to lease or to finance the
purchase of a motor vehicle, agrees to waive for no additional charge the
amount specified in paragraph (b) of this subsection upon total loss of the
motor vehicle because of physical damage, theft or other occurrence, as
specified in the agreement. The exemption established in this subsection
applies to the following persons:
(A) The seller of the
motor vehicle, if the sale is made pursuant to a motor vehicle retail
installment contract.
(B) The lessor of the
motor vehicle.
(C) The lender who
finances the purchase of the motor vehicle.
(D) The assignee of a
person described in this paragraph.
(b) The amount waived
pursuant to the agreement shall be the difference, or portion thereof, between
the amount received by the seller, lessor, lender or assignee, as applicable,
which represents the actual cash value of the motor vehicle at the date of
loss, and the amount owed under the agreement.
SECTION 2. This 2007 Act being necessary for the
immediate preservation of the public peace, health and safety, an emergency is
declared to exist, and this 2007 Act takes effect on its passage.
Approved by the Governor July 17, 2007
Filed in the office of Secretary of State July 19, 2007
Effective date July 17, 2007
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