Bill Text: OR HB3411 | 2011 | Regular Session | Enrolled
Bill Title: Relating to portable electronics; and declaring an emergency.
Sponsorship: Committee Bill
Status: (Passed) 2011-06-16 - Chapter 393, (2011 Laws): Effective date June 16, 2011. [HB3411 Detail]
Download: Oregon-2011-HB3411-Enrolled.html
76th OREGON LEGISLATIVE ASSEMBLY--2011 Regular Session
Enrolled
House Bill 3411
Sponsored by COMMITTEE ON GENERAL GOVERNMENT AND CONSUMER
PROTECTION
CHAPTER ................
AN ACT
Relating to portable electronics; and declaring an emergency.
Be It Enacted by the People of the State of Oregon:
SECTION 1. { + As used in sections 1 to 7 of this 2011 Act:
(1) 'Customer' means a person that purchases or leases portable
electronics.
(2) 'Enrolled customer' means a customer that purchases
portable electronics insurance coverage from a vendor
policyholder.
(3) 'Insurer' means an insurer as defined in ORS 731.106 that
issues, sells or offers for sale policies of portable electronics
insurance to vendor policyholders.
(4) 'Limited license' means a license that authorizes a vendor
to issue, sell or offer for sale portable electronics insurance
coverage.
(5) 'Location' means a physical location in this state or a
website, call center site or similar electronic or telephonic
location where portable electronics may be purchased or leased.
(6) 'Person' means an individual, partnership, corporation,
incorporated or unincorporated association, joint stock company
or any similar entity or combination of entities acting in
concert.
(7) 'Portable electronics' means an electronics device that is
portable and includes accessories and services, including but not
limited to wireless services, related to use of the device.
(8)(a) 'Portable electronics insurance coverage' means
insurance that provides coverage for the repair or replacement of
portable electronics in the event of loss, theft, inoperability
due to mechanical failure, malfunction, damage or need for repair
or replacement as a result of some other covered source of peril.
(b) 'Portable electronics insurance coverage' does not include:
(A) A service contract as defined in ORS 646A.152 that is
governed by ORS 646A.150 to 646A.172;
(B) A warranty;
(C) A maintenance agreement as defined in ORS 646A.152; or
(D) A policy of insurance covering the obligations of a vendor
or of a portable electronics manufacturer under a warranty.
(9) 'Supervising entity' means an insurer as defined in ORS
731.106, or an insurance producer as defined in ORS 731.104, that
may or may not issue, sell or offer for sale policies of portable
electronics insurance to vendor policyholders.
Enrolled House Bill 3411 (HB 3411-A) Page 1
(10) 'Vendor' means a person engaged in the business of selling
or leasing or offering for sale or lease portable electronics.
(11) 'Vendor policyholder' means a vendor that holds a limited
license under section 2 of this 2011 Act and that has been issued
a policy by an insurer or a supervising entity pursuant to which
the vendor may issue, sell or offer for sale portable electronics
insurance coverage to customers. + }
SECTION 2. { + (1) A vendor may not issue, sell or offer for
sale portable electronics insurance coverage unless the vendor
has been issued a limited license by the Department of Consumer
and Business Services under this section.
(2)(a) An application for a limited license under this section
must be submitted on a form in accordance with paragraph (b) of
this subsection and accompanied by a fee as prescribed by the
department by rule.
(b) The application must, at a minimum, include:
(A) The name and street address of an employee, agent or
authorized representative of the vendor who is the person
designated by the vendor as being responsible for the vendor's
compliance with sections 1 to 7 of this 2011 Act; and
(B) The name and address in this state of a person designated
by the vendor as the vendor's agent upon whom may be served, in
the manner described in ORS 59.155, at any time any process,
notice or demand in a civil proceeding brought in connection with
portable electronics insurance coverage, including a proceeding
brought by the Director of the Department of Consumer and
Business Services.
(c) A vendor licensed under this section shall annually update
the contact information provided to the department under
paragraph (b) of this subsection.
(3)(a) A limited license issued under this section is valid for
two years unless suspended or revoked by the department.
(b) A limited license may be renewed upon expiration for
another two-year period upon application of the vendor and
payment of a fee as prescribed by the department by rule.
(4) A vendor licensed under this section may not advertise,
represent or otherwise hold itself out as being licensed to sell
any other type of insurance unless the vendor is actually
licensed under the laws of this state to sell the other type of
insurance. + }
SECTION 3. { + (1) A vendor policyholder may bill and collect
the cost of portable electronics insurance coverage purchased by
an enrolled customer. Any charge to the enrolled customer for
coverage that is not included in the cost to the enrolled
customer to purchase or lease portable electronics must be
separately itemized in writing. If the coverage is included with
the purchase or lease of portable electronics, whether or not the
coverage is included in the cost to the enrolled customer of the
purchase or lease of the portable electronics, the vendor
policyholder shall clearly and conspicuously disclose in writing
to the enrolled customer that the coverage is included with the
purchase or lease of the portable electronics.
(2) If authorized by an insurer or a supervising entity, a
vendor policyholder that bills and collects the cost of portable
electronics insurance coverage from an enrolled customer is not
required to deposit the amount paid in a segregated account but
shall remit the amount collected to the insurer or the
supervising entity within 60 days of receipt from the enrolled
customer.
Enrolled House Bill 3411 (HB 3411-A) Page 2
(3) Moneys collected by a vendor policyholder from an enrolled
customer for the cost of portable electronics insurance coverage
are funds held by the vendor policyholder in trust for the
benefit of the insurer or the supervising entity.
(4) A vendor policyholder may receive compensation from an
insurer or a supervising entity for billing and collecting the
cost of portable electronics insurance coverage purchased by
enrolled customers.
(5) Vendor policyholders, insurers and supervising entities are
not subject to ORS 744.083 and 744.084. + }
SECTION 4. { + A vendor policyholder shall make available to
prospective customers of portable electronics written materials
that disclose:
(1) That portable electronics insurance coverage may duplicate
coverage already held by the customer, including but not limited
to homeowner's insurance or renter's insurance;
(2) That issuance of portable electronics insurance coverage is
not required for the customer to purchase or lease portable
electronics;
(3) The material terms of coverage, including but not limited
to:
(a) The identity of and contact information for the insurer or
the supervising entity that issued the insurance policy to the
vendor policyholder;
(b) The amount of any applicable deductible and how the
deductible is required to be paid when a claim is made;
(c) The benefits of coverage; and
(d) Whether the covered portable electronics will be repaired
or replaced with a similar make and model, with a new or
reconditioned device, accessory or part, or with a device,
accessory or part from other than the original manufacturer;
(4) The process and requirements for returning portable
electronics, and any fees that will apply in the event the
enrolled customer does not comply with the process and
requirements; and
(5) That the enrolled customer may cancel the portable
electronics insurance coverage at any time and that the person
paying the premium shall receive a refund of the unused portion
of any amount that has been paid for coverage. A reasonable
administrative fee may be charged in an amount not to exceed 10
percent of the refund due. + }
SECTION 5. { + (1) An employee, agent or authorized
representative of a vendor policyholder may issue, sell or offer
for sale portable electronics insurance coverage to a customer
without obtaining a limited license under section 2 of this 2011
Act if:
(a) The vendor policyholder has been issued a limited license
under section 2 of this 2011 Act; and
(b) The insurer or the supervising entity that issued a policy
of portable electronics insurance to the vendor policyholder
develops a training program for employees, agents and authorized
representatives of the vendor policyholder that:
(A) Is completed by employees, agents and authorized
representatives of the vendor policyholder who are directly
engaged in the issuing, selling or offering for sale of portable
electronics insurance coverage to customers;
(B) Includes basic instruction about portable electronics
insurance coverage and the disclosures required under section 4
of this 2011 Act; and
Enrolled House Bill 3411 (HB 3411-A) Page 3
(C) If delivered electronically, includes a supplementary
education program that is conducted and overseen by employees of
the insurer or the supervising entity.
(2) An employee, agent or authorized representative of a vendor
policyholder who is authorized to issue, sell or offer for sale
portable electronics insurance coverage under this section may
not advertise, represent or otherwise hold themselves out as
holding a limited license under section 2 of this 2011 Act or
being a licensed insurer or insurance producer as those terms are
defined in ORS 731.104 and 731.106 unless the employee, agent or
authorized representative has been issued a limited license or is
licensed as an insurer or insurance producer under the laws of
this state.
(3) The acts of an employee, agent or authorized representative
of a vendor policyholder who is authorized to issue, sell or
offer for sale portable electronics insurance coverage under this
section are deemed to be the acts of the vendor policyholder for
purposes of sections 1 to 7 of this 2011 Act. + }
SECTION 6. { + (1) Except as provided in subsections (2) and
(3) of this section, the insurer or the supervising entity that
has issued a policy of portable electronics insurance to a vendor
policyholder may not modify or terminate the terms and conditions
of the policy unless the insurer or the supervising entity:
(a) Provides the vendor policyholder and enrolled customers
with notice of the modification or termination not less than 60
days prior to the effective date of the modification or
termination; and
(b) In the event of a modification only, provides:
(A) The vendor policyholder with a revised policy or
endorsement evidencing the modification; and
(B) Each enrolled customer with a revised certificate,
endorsement or other evidence of a change in terms and
conditions, updated written materials and a summary of the
material changes to the terms and conditions of coverage.
(2)(a) An insurer or a supervising entity may terminate an
enrolled customer's portable electronics insurance coverage:
(A) Upon discovery of fraud or material misrepresentation made
by the enrolled customer in obtaining the coverage or in the
presentation of a claim; or
(B) For nonpayment of a premium.
(b) The insurer or the supervising entity must notify the
enrolled customer at least 15 days before a termination under
this subsection.
(3) An insurer or a supervising entity may immediately
terminate an enrolled customer's portable electronics insurance
coverage if the enrolled customer ceases to have active wireless
service with the vendor policyholder or the enrolled customer
exhausts the aggregate limit of liability, and the insurer or the
supervising entity sends notice of termination to the enrolled
customer within 30 days after the active service ceases or the
limit has been exhausted.
(4) A vendor policyholder that has issued portable electronics
insurance coverage to an enrolled customer may not terminate the
coverage unless the vendor policyholder provides the enrolled
customer with notice of the termination not less than 30 days
prior to the effective date of the termination.
(5)(a) Notice to a vendor policyholder or enrolled customer
that is required under this section may either be sent as an
electronic record in accordance with ORS 84.001 to 84.061 and
84.070, or:
Enrolled House Bill 3411 (HB 3411-A) Page 4
(A) In the case of a vendor policyholder, mailed by registered
or certified mail or delivered to the vendor policyholder at the
vendor policyholder's principal place of business in this state;
or
(B) In the case of an enrolled customer, mailed by registered
or certified mail to the enrolled customer's last known mailing
address.
(b) An insurer, a supervising entity or a vendor policyholder
providing notice under this section must maintain proof of
providing the notice for a minimum of three years after the
termination of the portable electronics insurance coverage. + }
SECTION 7. { + The Department of Consumer and Business
Services shall adopt rules to carry out the provisions of
sections 1 to 7 of this 2011 Act. + }
SECTION 8. { + In addition to all other penalties and
enforcement provisions provided by law, if a person violates a
provision of sections 1 to 7 of this 2011 Act or a rule adopted
by the Department of Consumer and Business Services under section
7 of this 2011 Act, the department may:
(1) Suspend or revoke the person's limited license issued under
section 2 of this 2011 Act;
(2) Modify the terms of the person's limited license issued
under section 2 of this 2011 Act to limit:
(a) The locations at which a vendor policyholder may issue,
sell or offer for sale portable electronics insurance coverage;
or
(b) The ability of employees, agents or authorized
representatives of the vendor policyholder to issue, sell or
offer for sale portable electronics insurance coverage; and
(3) Impose a civil penalty in the manner provided in ORS
183.745 not to exceed $1,000 per violation or $10,000 for
multiple violations. + }
SECTION 9. { + A vendor that is engaged in the issuance, sale
or offering for sale of portable electronics insurance coverage
on the operative date set forth in section 10 of this 2011 Act
shall apply for a limited license under section 2 of this 2011
Act within 90 days after the operative date specified in section
10 of this 2011 Act. + }
SECTION 10. { + Sections 1 to 9 of this 2011 Act become
operative on January 1, 2012. + }
SECTION 11. { + The Department of Consumer and Business
Services may take any action before the operative date specified
in section 10 of this 2011 Act that is necessary for the
department to exercise, on and after the operative date specified
in section 10 of this 2011 Act, all of the duties, functions and
powers conferred on the department by sections 1 to 8 of this
2011 Act. + }
SECTION 12. { + This 2011 Act being necessary for the
immediate preservation of the public peace, health and safety, an
emergency is declared to exist, and this 2011 Act takes effect on
its passage. + }
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Enrolled House Bill 3411 (HB 3411-A) Page 5
Passed by House May 2, 2011
.............................................................
Ramona Kenady Line, Chief Clerk of House
.............................................................
Bruce Hanna, Speaker of House
.............................................................
Arnie Roblan, Speaker of House
Passed by Senate May 31, 2011
.............................................................
Peter Courtney, President of Senate
Enrolled House Bill 3411 (HB 3411-A) Page 6
Received by Governor:
......M.,............., 2011
Approved:
......M.,............., 2011
.............................................................
John Kitzhaber, Governor
Filed in Office of Secretary of State:
......M.,............., 2011
.............................................................
Kate Brown, Secretary of State
Enrolled House Bill 3411 (HB 3411-A) Page 7
