OAR 836-071-0260: Fees Charged by Insurance Producers

(1) When an insurance producer or any affiliate of the insurance producer receives any compensation authorized under ORS 735.455, 744.091 or 744.093 from a prospective insured for transacting insurance, neither the insurance producer nor the affiliate may accept or receive any compensation from an insurer or other third party for the placement of insurance for the prospective insured unless the insurance producer, prior to the prospective insured’s purchase of insurance, has: (a) Obtained the prospective insured’s documented acknowledgment that the compensation will be received by the insurance producer or affiliate; (b) Disclosed the amount of compensation from the insurer or other third party for the placement. If the amount of compensation is not known at the time of disclosure, the insurance producer shall disclose the specific method for calculating the compensation and, if possible, a reasonable estimate of the amount; and (c) Disclosed the nature of the work that the insurance producer or affiliate will perform on behalf of the prospective insured. (2) When an insurance producer or any affiliate of the insurance producer receives any compensation authorized under ORS 735.455, 744.091 or 744.093 from a prospective insured for transacting insurance and receives no compensation from an insurer or other third party for placement of insurance for the prospective insured, the insurance producer or affiliate must obtain the prospective insured’s documented acknowledgement that the compensation will be received by the insurance producer and must disclose the nature of the work that the insurance producer or affiliate will perform on behalf of the prospective insured. (3) A person is not a prospective insured for the purpose of this rule if the person is merely: (a) A participant or beneficiary of an employee benefit plan; or (b) Covered by a group or blanket insurance policy or group annuity contract sold, solicited or negotiated by the insurance producer or affiliate. (4) This rule does not apply to any of the following persons: (a) An insurance producer when the insurance producer acts only as an intermediary between an insurer and the prospective insured’s insurance producer, such as a managing general agent, a wholesale insurance producer under ORS 744.093, a surplus lines licensee when transacting insurance with a producing insurance producer under ORS 735.455 or a sales manager. (b) An insurance producer with respect to an incidental charge that is received from the prospective insured and is authorized under OAR 836-071-0267. (c) A reinsurance intermediary. (5) As used in this rule: (a) “Affiliate” means a person that controls, is controlled by or is under common control with the insurance producer. (b) “Compensation from an insurer or other third party” means payments, commissions, fees, awards, overrides, bonuses, contingent commissions, loans, stock options, gifts, prizes or any other form of valuable consideration, whether or not payable pursuant to a written agreement. (c) “Compensation from a prospective insured” does not include any fee or amount collected by or paid to the insurance producer that does not exceed an amount established by the Director.