Free Oregon Casualty practice questions

Answer: C. Within the preceding seven years

Under Oregon's correction provision, once an insurer corrects, amends or deletes recorded personal information, it tells the individual in writing and sends the change to an insurance-support organization that relies primarily on insurers for its information, if that organization systematically received recorded personal information from the insurer within the preceding seven years and still maintains information about the individual. Two years is the period for persons the individual specifically designates who may have received the information, a different category from this organization. Five and ten years are not periods the correction provision uses.

Answer: D. Unless the Code expressly allows otherwise, it must be plainly set out in the policy

Oregon forbids making or offering to make an insurance contract, or an agreement about one, unless every agreement or understanding given as an inducement is plainly expressed in the policy issued, except where the Insurance Code expressly provides otherwise. A note in the producer's file, an underwriter's separate letter, or a mention on the application is not the policy, so none of them satisfies the statute.

Answer: B. No personal or privileged information, nor any classification drawn from it

Oregon allows disclosure to a nonaffiliated third party for marketing only when several conditions are all met, and the first is that no privileged or personal information is disclosed, nor any classification derived from such information. The individual ordinarily must also have received the privacy notice and a chance to say no to marketing disclosures, and the recipient must agree to use the information only for marketing; those are additional conditions, so neither a notice nor a marketing-only agreement permits sharing personal or privileged information. Personal information includes personal financial information, so separating financial details from health information does not satisfy the condition.

Answer: B. That the applicant may ask to be interviewed as part of preparing the report

ORS 746.635(1) bars preparing or requesting an investigative consumer report in connection with an application, renewal, reinstatement or change in benefits unless the individual is told two things: that the individual may ask to be interviewed in connection with the report, and that on a request under ORS 746.640 the individual can receive a copy of it. If the insurer or producer prepares the report, it must have reasonable procedures to hold a requested interview. The section gives the applicant no right to pick the people interviewed or to block the report by withholding consent, and it calls for no review by the director.

Answer: C. A license as an insurance producer covering the class or classes being solicited

Oregon bars any person from selling, soliciting or negotiating insurance in the state for a class of insurance unless the person holds an insurance producer license for that class. The license has to match the class being sold, so a license in one class does not open every class. An insurer appointment does not substitute for the license, because the statute makes the producer license itself the precondition. Supervision by another producer is likewise not a substitute for holding the license.

Answer: D. It may not serve as any part of the basis for an adverse decision

Oregon law bars an insurer or producer from basing an adverse underwriting decision, in whole or in part, on the fact that an individual previously obtained coverage through a residual market mechanism. Because the bar reaches partial reliance, using the fact as one reason among several is prohibited, and explaining the reason in writing or pointing to how long she was in that market does not make it a permitted basis.

Answer: C. It must allow any transaction to be traced back to its original source document

Oregon requires a producer's premium recordkeeping system, whether electronic or manual, to provide an audit trail so that the details behind summary figures, such as invoices, checks and statements, can be identified and produced on request, and so that any transaction can be traced to its original source. Paper-only is wrong because the rule accepts electronic or manual systems. Combining accounts is wrong because any system used must effectively isolate each trust account from operating accounts. One year after issue is wrong because records must be available for three years following the date the policy expires.

Answer: B. It falls outside the definition of an adverse underwriting decision, but its specific reasons must still be given.

Oregon's definitions list rescission of a policy among the actions that are not adverse underwriting decisions, and they add that the insurer or producer responsible must nevertheless give the applicant or policyholder the specific reason or reasons for it. So a rescission sits outside the definition but still carries a duty to explain. Saying the insurer owes no reasons ignores that added duty. Termination of insurance coverage is defined as a cancellation or nonrenewal, and rescission is listed separately from it, so a rescission is not a termination. Placement with a residual market mechanism is a separate listed adverse decision for coverage other than life or health, and the definitions attach no such condition to rescission.

Answer: B. It is a prohibited false statement made to obtain a commission from an insurer

Oregon bars any person from making a false or fraudulent statement on or relating to an application for insurance, and also bars such a statement made to get a commission, money or benefit from an insurer or producer. An invented application submitted to earn a commission is both. The prohibition is addressed to every person, so it is not limited to applicants, and the section sets no condition that a claim be paid or that a consumer be harmed before the conduct is unlawful.

Answer: A. The two years before the request

Oregon's access provision requires the insurer, when it answers a proper written request, to tell the individual who received the recorded personal information from it within two years before the request, if those identities are recorded. Where they are not recorded, the insurer gives the names of those to whom such information is normally disclosed. Seven years is the look-back the correction provision uses for certain insurance-support organizations, not the access period. Neither one year nor five years appears in the access provision.