Oregon Administrative Rules Chapter 836 - DEPARTMENT OF CONSUMER AND BUSINESS SERVICES, INSURANCE REGULATION
Oregon Administrative Rules Chapter 836 — Department of Consumer and Business Services, Insurance Regulation
Overview
OAR Chapter 836 contains the administrative rules implemented by the Oregon Department of Consumer and Business Services (DCBS), specifically relating to insurance regulation within the state. The Insurance Division of DCBS is responsible for enforcing insurance laws, regulating insurance companies and agents, and protecting consumers in Oregon’s insurance markets.
Authority and Purpose
The Insurance Division operates under the authority of the Oregon Insurance Code (ORS Chapter 731).
OAR Chapter 836 provides detailed procedural and substantive regulations for the licensing, conduct, and solvency of insurance companies, producers (agents/brokers), adjusters, and other industry participants.
The primary goals are to ensure:
Fair and lawful insurance practices.
Consumer protection from unfair or deceptive acts.
Financial solvency and market stability.
Compliance with state and federal insurance laws.
Key Components of OAR Chapter 836
Licensing and Regulation of Insurance Professionals:
Rules govern the licensing requirements for insurance producers, adjusters, consultants, and other related professions.
Licensing includes qualifications, continuing education, fees, and disciplinary procedures.
Rules specify grounds for denial, suspension, or revocation of licenses.
Insurance Company Regulation:
Regulations cover the financial standards, reporting, and market conduct of insurance companies operating in Oregon.
Requirements for rate filings, policy forms, and solvency monitoring are established.
Procedures for company examinations and investigations are outlined.
Consumer Protections:
OAR 836 includes rules addressing unfair claims practices, marketing standards, and disclosures.
Procedures for consumer complaints and investigations by the Insurance Division.
Rules on cancellation and nonrenewal of policies to protect policyholders.
Market Conduct and Enforcement:
Rules set standards for insurer behavior in claims handling, underwriting, and advertising.
The Division enforces compliance through investigations, hearings, and sanctions.
Administrative penalties and cease-and-desist orders can be issued for violations.
Rate and Form Filings:
Insurers must file policy forms and premium rates with the Insurance Division for approval before use.
The rules establish timelines, standards, and grounds for disapproval.
Administrative Procedures:
Rules for hearings, appeals, and contested cases before the Division are detailed.
Procedures ensure due process for regulated entities and consumers.
Relevant Case Law Related to OAR Chapter 836 and Oregon Insurance Regulation
Several Oregon cases have clarified the scope and application of the Insurance Division’s authority under OAR Chapter 836 and the underlying statutes:
1. State ex rel. Insurance Commissioner v. Farmers Ins. Co., 297 Or. 112 (1984)
Issue: Whether the Insurance Commissioner (and by extension the Division) had authority to disapprove insurance policy forms and rates.
Holding: The Oregon Supreme Court upheld the Commissioner’s broad authority to regulate rates and forms to protect consumers.
Significance: Confirms the regulatory framework under OAR 836 that requires insurer filings to be reviewed for compliance with statutory and regulatory standards.
2. Gilbert v. Oregon Department of Consumer and Business Services, 134 Or. App. 19 (1995)
Issue: Due process challenge related to license revocation proceedings against an insurance producer.
Holding: The court ruled that OAR procedures provided adequate notice and opportunity to be heard, satisfying constitutional due process.
Significance: Supports the procedural fairness of OAR Chapter 836’s licensing and disciplinary rules.
3. Greenfield v. State Farm Fire & Casualty Co., 289 Or. 401 (1980)
Issue: Whether insurer’s cancellation of homeowner’s policy complied with OAR and statutory requirements.
Holding: The court emphasized that insurers must strictly follow administrative rules regarding cancellations to protect consumers.
Significance: Reinforces the importance of consumer protection rules in OAR 836, especially related to policy cancellation and nonrenewal.
4. Or. Insurance Division v. Prudential Ins. Co., 140 Or. App. 523 (1996)
Issue: Market conduct investigation and enforcement action against insurer for unfair claims practices.
Holding: The court affirmed the Insurance Division’s authority to investigate and sanction unfair practices under OAR rules.
Significance: Validates the Division’s enforcement powers and the substantive standards in OAR 836.
Practical Implications of OAR Chapter 836
Insurance Companies must comply with extensive financial, market conduct, and reporting rules, and submit all required filings to the Division.
Insurance Producers and Adjusters need to maintain proper licensing and comply with conduct rules or risk discipline.
Consumers are protected by rules that regulate insurer behavior, claims handling, and policy terminations.
The Insurance Division has broad investigatory and enforcement powers, including administrative hearings and penalties.
Summary
OAR Chapter 836 implements Oregon’s insurance regulatory framework, governing licensing, company operations, consumer protection, and enforcement.
The rules ensure insurance markets operate fairly, transparently, and with financial stability.
Oregon courts have consistently upheld the Insurance Division’s authority under these rules, emphasizing due process and consumer protections.
This regulatory structure plays a critical role in balancing insurer interests with protecting Oregon insurance consumers.
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