Security deposit information
Instructions for deposit
- A transmittal letter must be sent to the bank and to the Division
of Financial Regulation before any transaction.
- The transmittal letter should include the following:
- Description of maturing asset if applicable.
- Description of assets being placed (see Eligible Security section
- Details of purpose and dedication of funds (i.e. workers' comp, surety
etc.). Funds will be dedicated similar to the maturing item if no instruction
- Specific bank related information such as routing instructions (contact
US Bank for details).
- Assets must be approved by the Division of Financial Regulation before you
proceed with your transaction.
- All security deposits are held by US Bank in Portland, Oregon.
- Delivery instructions will be provided by the bank upon request.
You are urged to periodically review your security deposits to assure your
company maintains sufficient market value for the class or classes for which
the deposit is required. This is particularly important for workers' compensation
731.616(3) provides only a 30-day period for increasing a deposit deficiency
after notice from the director.
Assignment of deposited securities
Securities held at US Bank are held in a custodial account under the control
of the director.
731.620(1) requires that "the insurer shall assign in trust to the
director of the Department of Consumer and Business Services and successors
in office all securities being deposited through the director under the insurance
code that are not negotiable by delivery…"
Eligible securities are amply secured obligations of the United States, a state,
or a political subdivision of a state.
For deposit purposes, securities must have a NAIC SVO rating of 1 per the most
recent Valuation of Securities Manual. Should the designation be lowered after
the deposit is made, the insurer must replace the security within 30 days.
The margin between the amount requested and the basic requirement stated in
the Oregon insurance code is set to cover market value fluctuations, under ORS
The following describes some acceptable and unacceptable deposits for Oregon
statutory deposit requirements:
- U.S. Treasury notes, bonds, bills, and strips
- General obligation or revenue bonds if rated 1 by NAIC Securities Valuation
- Certificate of Deposits ONLY if purchased from US Bank
- Federal National Mortgage Association (FNMA)
- Federal Home Loan Mortgage Corporation (FHLMC)
- Government agency bonds NOT backed by federal government
- Any certificate of deposit issued by a bank other than US Bank
- Temporary Liquidity Guarantee Program (TLGP)
- Corporate bonds [unless total deposit exceeds $50 million, ORS