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Oregon: OID Considers Proposed Producer Disclosure Requirements Regs

Oregon's insurance division is reviewing information it requested in December 2004 from 26 large insurers and 11 large insurance brokers to determine if improper solicitation or compensation activities occurred or are occurring, according to the division's April newsletter.

Fifteen large commercial insurance buyers also have asked the division to review their transactions to see if they were appropriately handled. The division will consider testimony from its December 2004 public hearing, other public comments, and the model act developed by the National Association of Insurance Commissioners (NAIC), when considering the proposed regulation. No date has been set for further review of the proposed regulation or implementation.

On Oct. 15, 2004, the division filed proposed administrative rules relating to insurance producers (agents and brokers) disclosure requirements. On Dec. 15, 2004, the division held a public hearing on the matter. NAMIC, directly and through its member companies provided comments opposing the proposed regulation. NAMIC has been actively involved in addressing this issue at the state level, and through the National Conference of Insurance Legislators and the NAIC.

The proposed regulations set forth the following points:

• the word "agent" needs to be replaced throughout the Insurance Division rules with "insurance producer;"
• minimum terms of compensation agreements between affected insurance producers and their customers need to be established;
• division rules governing felony waivers should be extended to apply to persons in the insurance industry who are not required to be licensed;
• a rule is needed to allow insurance producers transacting personal lines to charge fees to their clients for certain services;
• a rule is needed to specify the types of limited lines for which licenses may be issued; and
• an amendment is proposed to a rule governing replacement of life insurance policies and annuity contracts, to limit the notice requirement to actual replacement transactions.

Direct questions to NAMIC State Affairs Manager Christian J. Rataj.