Chapter 485 Oregon Laws 1999

Session Law

AN ACT

SB 842

Relating to insurance for rental vehicles.

Be It Enacted by the People of the State of Oregon:

SECTION 1. Sections 2 to 6 of this 1999 Act are added to and made a part of the Insurance Code.

SECTION 2. As used in sections 2 to 6 of this 1999 Act:

(1) "Limited license" means a license issued under section 3 of this 1999 Act that authorizes a rental company to offer or sell insurance as provided in section 4 of this 1999 Act.

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

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

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

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

SECTION 3. (1) The Director of the Department of Consumer and Business Services shall adopt rules establishing information required to be submitted by rental companies applying for a limited license.

(2) A rental company that intends to offer insurance as described in section 4 of this 1999 Act shall file a limited license application with the director in such form and containing such information as the director requires.

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

SECTION 4. A limited license issued under section 3 of this 1999 Act authorizes a rental company to offer and sell the following kinds of insurance in connection with the rental of vehicles:

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

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

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

(4) Roadside assistance and emergency sickness insurance.

SECTION 5. (1) A rental company issued a limited license under section 3 of this 1999 Act may not issue insurance pursuant to section 4 of this 1999 Act unless:

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

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

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

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

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

(D) Describes the process for filing a claim.

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

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

(2) A rental company issued a limited license under section 3 of this 1999 Act must conduct a training program for employees concerning kinds of coverage offered by the company. The syllabus for the training program shall be filed annually with the Director of the Department of Consumer and Business Services by the rental company and is subject to approval by the director. The rental company shall certify annually to the director that all employees involved in the sale or offer of coverage to members of the public have completed or will complete the training program prior to conducting such sales or offers. The rental company shall also certify annually to the director that all such employees will receive continuing education on a regular basis concerning the topics covered in the training program. The rental company's compliance with its certification to the director and with the filed training program syllabus is subject to audit by the Department of Consumer and Business Services.

(3) A rental company issued a limited license under section 3 of this 1999 Act may not advertise, represent or otherwise hold itself or its employees out as licensed insurers, insurance agents or insurance brokers.

(4) A rental company issued a limited license under section 3 of this 1999 Act may offer and sell insurance only in connection with and incidental to the rental of vehicles.

(5) A rental company issued a limited license under section 3 of this 1999 Act shall designate an executive as the statewide filing officer for the rental company.

SECTION 6. (1) If a rental company issued a limited license under section 3 of this 1999 Act offers or sells insurance not authorized by section 4 of this 1999 Act, or violates any provision of section 5 of this 1999 Act, the Director of the Department of Consumer and Business Services may, after notice and hearing, revoke or suspend the limited license or may impose such other penalties as the director prescribes, including but not limited to suspension of transaction of insurance at specific rental locations where violations of section 4 or 5 of this 1999 Act have occurred.

(2) All provisions of the Insurance Code apply to rental companies issued limited licenses under section 3 of this 1999 Act unless specifically rendered inapplicable by statute or by rule adopted by the director.

(3) The director may adopt any rules necessary for the implementation of sections 2 to 6 of this 1999 Act, including rules establishing license fees to defray the cost to the Department of Consumer and Business Services of administering the limited licensure program.

Approved by the Governor July 6, 1999

Filed in the office of Secretary of State July 6, 1999

Effective date October 23, 1999

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