The Oregon Department of Consumer and Business Services issued COVID-19 emergency orders for multiple lines of insurance. The orders provide protection to people and businesses struggling because of the disruptions caused by the COVID-19 outbreak.
The first order was issued on March 25, 2020. It required all insurance companies to postpone policy cancellations and nonrenewals, extend grace periods for premium payments, and extend deadlines for reporting claims.
Postponement of policy cancellations and nonrenewals is not limited to nonpayment. This provides protection to some people and businesses in need of relief and ongoing insurance coverage.
The second order was issued on May 5, 2020. It applies to health insurers and requires at least a 60-day grace period to pay past due premiums, pay claims for any covered services during the first 30 days of the grace period, and extends deadlines for reporting claims and other communications.
Additional orders were issued on May 23, 2020. Those orders apply to property and casualty, long-term care, and life and disability insurers. These orders require insurers to provide at least a 60-day grace period to pay past due premiums, pay claims that occur during the first 30 days of the grace period, and extend deadlines for reporting claims and other communications.
The Division of Financial Regulation is sharing the frequently asked questions it has received to help insurers comply with the department’s orders. The FAQs will be updated regularly.
The division encourages insurers or other stakeholders to submit more questions about the order by email to firstname.lastname@example.org.
COVID-19 regulated businesses page to review the latest industry news and guidance issued by the division.
These questions apply to the emergency order that was issued on March 25. The orders issued on health, property and casualty, long-term care, and life and disability insurance supersede the March 25 order.
Does the order prohibit cancellations for reasons other than nonpayment?
The order prohibits many types of cancellations and nonrenewals for the duration of the order. However, some cancellations and nonrenewals may be appropriate and permitted. Therefore, the department will exercise enforcement discretion now and after the order expires if an insurer cancels or nonrenews a policy for certain reasons. While the order is in place, an insurer may cancel or nonrenew a policy for the following reasons:
- Voluntary or requested cancellation or nonrenewal
- Fraud or intentional misrepresentation of a material fact as prohibited by the terms of an insurance policy
- Criminal conduct as prohibited by the terms of an insurance policy
- Cancellation during the first 60 days of a property and casualty policy, during which the insurer is underwriting the policy, as long as a minimum 10-day notice is provided
- A notice of the cancellation or nonrenewal was issued before the governor’s Executive Order 20-07 (March 17, 2020), in compliance with all applicable laws and administrative rules
- The insurer has obtained evidence that the insured secured new coverage with another insurer
- Cancellation or nonrenewal is required by applicable state or federal law.
- Cancellation or nonrenewal of a property and casualty policy permitted under the first property and casualty FAQ.
Insurers who believe other situations should be included are encouraged to email the division at email@example.com.
How does the emergency order apply to premium finance companies?
Premium finance companies are encouraged to provide a 30-day grace period for payments and take other reasonable actions to help customers affected by COVID-19. Any notice given by a premium finance company should be consistent with state requirements and with the terms of the agreement.
In order to encourage insurance coverage for consumers, premium finance companies should not pursue any default actions for the duration of the outbreak.
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The questions in this section are for the emergency order for health insurers that was issued on May 5, 2020. For health insurance, this order supersedes the March 25 order.
What types of insurance are subject to the health insurance order?
The order applies to all policies of health insurance in Oregon, with the
exception of accidental death and dismemberment, disability, and long-term
care polices. This includes all fully-insured commercial health insurance policies,
including individual and group health benefit plans, limited benefit, short-term
limited-duration, and Medicare Supplement policies. However, to the extent
that federal requirements for Medicare Supplement plans conflict with the order,
federal requirements supersede the order.
The order does not apply to self-insured employer plans. However, the division
strongly encourages self-insured employers to take steps to provide similar
relief and flexibility to employee benefit plan members.
How does the order apply to health insurance policies that were in a grace period on the date of the order?
With the exception of qualified health plans purchased with tax credits through
the Health Insurance Marketplace (see next question), health insurance policies
that were in a grace period as of the March 25 order must be provided a grace
period of at least 60 total days. For example, if a policy was provided a 30-day
grace period ending March 31, the grace period for that policy must be extended
by at least 30 days to provide a total of 60 days.
How does the order apply in situations where an employer offering a health benefit plan is no longer eligible for its group plan due to a change in group size?
Insurers offering health benefit plans are reminded that the division’s guidance
on employee counting is based on the average number of employees during the
preceding calendar year (see https://dfr.oregon.gov/laws-rules/Documents/OAR/div53-0015_exA.pdf ).
Consistent with that guidance, insurers offering health benefit plans should
consider group size only at the time of renewal. These insurers may not cancel
a group health benefit plan policy based on a change in the number of employees
during a contract year.
At the time of renewal, the insurer may review the number of people employed
over the preceding year to assign the group to the appropriate market, consistent
with the division’s guidance on employee counting.
Insurers offering health benefit plans are also reminded, even if an employer’s
market size has changed, the employer is still entitled to guaranteed issue
in the small or large employer market. Accordingly, the insurer must still
offer to renew the employer onto any plans the insurer offers in the appropriate
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Property and Casualty, long-term care, and life and disability insurance
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