Oregon General Lines Adjuster Practice Test: Oregon law, Part 2

Correct answer: A. Only if an independent test facility certified it as at least equivalent

ORS 746.287 bars an insurer from requiring, without the owner's consent, an aftermarket crash part unless an independent test facility has certified it to be at least equivalent, meaning the same kind of part and at least the same quality in fit, finish, function and corrosion resistance. Listing the part is a separate duty: OAR 836-080-0240(11) and ORS 746.292(3) require estimates to identify non-original manufacturer crash parts.

Reference: ORS 746.287; ORS 746.292(3); OAR 836-080-0240(11)

Correct answer: D. Reopen the claim file and resolve it by an option the rule allows

OAR 836-080-0240(6) requires an insurer to reopen its claim file if the insured says within 35 days of receiving the claim draft that he cannot buy a comparable car for the settlement value. The insurer may then find a comparable car at that value, pay the difference or buy one for him, offer a replacement, or use the policy's appraisal clause. Section (7) excuses this only if the settlement identified a specific comparable car.

Reference: OAR 836-080-0240(6) and (7)

Correct answer: C. Surrender it to the Oregon Department of Transportation within 30 days

ORS 819.014(1)(a) requires an insurer that declares a vehicle totaled to obtain the certificate of title as a condition of settlement and surrender it to the Department of Transportation within 30 days of receipt. If it cannot get the title, it must notify the department within 30 days and tell the owner to surrender the title. ORS 801.527 defines a totaled vehicle to include one an insurer declares a total loss.

Reference: ORS 819.014(1); ORS 801.527

Correct answer: B. $50,000/$100,000 bodily injury and $10,000 property damage

Oregon's standard minimum schedule in ORS 806.070 is $25,000 per person and $50,000 per accident for bodily injury and $20,000 for property damage. ORS 806.075 sets higher bodily injury amounts for a person convicted of DUII: $50,000 per person, $100,000 per accident and $10,000 property damage, and the filings must be maintained for three years from the date the first filing is required.

Reference: ORS 806.070(2); ORS 806.075

Correct answer: B. $6,000

ORS 742.524(1)(b) pays 70% of lost income when disability lasts at least 14 days, up to $3,000 a month for no more than 52 weeks. Seventy percent of $5,000 is $3,500, which the cap reduces to $3,000 a month, so two months pay 2 x $3,000 = $6,000. $7,000 ignores the monthly maximum, and $10,000 ignores both the 70% rate and the cap.

Reference: ORS 742.524(1)(b)

Correct answer: D. They cover expenses incurred within two years of injury, up to $15,000

ORS 742.524(1)(a) requires PIP to pay reasonable and necessary medical, hospital, dental, surgical, ambulance and prosthetic expenses incurred within two years after the injury, up to $15,000 per person. The charges are presumed reasonable and necessary unless the provider receives notice of denial within 60 days after the insurer receives notice of the claim. Funeral benefits are separate: up to $5,000 within one year.

Reference: ORS 742.524(1)(a) and (d)

Correct answer: A. He may sign a written election of limits as low as $25,000/$50,000

ORS 742.502(2) requires uninsured motorist limits equal to the bodily injury liability limits unless a named insured elects lower limits in writing, signing the election statement within 60 days. The lower limits cannot be below the ORS 806.070 minimums of $25,000 per person and $50,000 per accident. Oregon UM coverage must also include underinsurance coverage, and it cannot be rejected altogether.

Reference: ORS 742.502(2); ORS 806.070

Correct answer: C. The association pays the full $420,000, which is under its $600,000 cap

ORS 734.570(1) obligates the association to pay covered claims existing at the insolvency determination or arising within 30 days after it, so a loss 10 days later qualifies. As amended in 2025, the limit is $600,000 per covered claim for insolvencies on or after January 1, 2025, so the full $420,000 is paid. Paying only the part under $300,000 is the rule for insolvencies through 2024. Separately, ORS 734.510 excludes first party claims of insureds whose net worth exceeds $25 million.

Reference: ORS 734.570(1)(a) and (b), as amended by Oregon Laws 2025, chapter 20; ORS 734.510(4)

Correct answer: C. 24 months next after inception of the loss

ORS 742.240 requires the fire policy to say that no suit or action to recover a claim is sustainable unless all policy requirements have been met and the suit is commenced within 24 months next after inception of the loss. The period runs from the loss itself, not from a denial letter or the end of the policy term, so a claimant who waits on a denial can lose the right to sue.

Reference: ORS 742.240

Correct answer: A. At least 10 days' notice, stating nonpayment as the reason

Once a policy has been in effect 60 days, ORS 742.562 allows cancellation only for nonpayment of premium, fraud or material misrepresentation or policy violations, or a suspended or revoked license of the named insured or a household or customary driver. ORS 742.564 requires 30 days' notice with reasons, except 10 days' notice with the reason for nonpayment. Nonrenewal needs 30 days' notice under ORS 742.566.

Reference: ORS 742.562(1) and (2); ORS 742.564(1); ORS 742.566(1)

Correct answer: D. 10 working days' notice; the insured may ask for a hearing within 30 days

ORS 742.702(2) makes cancellation of a commercial liability policy effective no sooner than 10 working days after the insured receives written notice stating the reason and hearing rights. Under ORS 742.704, the insured may request a hearing before the Director within 30 days, and the insurer bears the burden of proving the reason. Forty-five days is the notice period for nonrenewal under ORS 742.706(2).

Reference: ORS 742.702(1)(c) and (2); ORS 742.704; ORS 742.706(2)

Correct answer: A. A copy of the application was indorsed on or attached to the policy

ORS 742.013 treats application statements as representations, not warranties. A misstatement prevents recovery only if it is in a written application that is indorsed on or attached to the policy, the insurer shows it was material and relied on it, and it was either fraudulent or material to the acceptance of the risk or the hazard assumed. The statute does not require that the misstatement caused the loss.

Reference: ORS 742.013(1)

Correct answer: D. Public adjusters handle only first party, non-auto property claims

OAR 836-071-1100 limits public adjusters to assisting insureds with first party claims and excludes personal and commercial auto claims, and OAR 836-071-1105 defines the role around policies insuring real or personal property. The Division's August 2025 notice says one person cannot hold a public adjuster and an independent adjuster license at the same time. These rules took effect August 1, 2025.

Reference: OAR 836-071-1100 and 836-071-1105 (DCBS order ID 5-2025); DFR memorandum, August 5, 2025

Correct answer: A. Rescind in writing within 3 business days; refund due within 15 business days

OAR 836-071-1165(8) gives the insured the right to rescind a public adjuster contract within three business days after signing, by a written rescission mailed or delivered to the public adjuster. Under section (9), anything of value she gave under the contract must be returned within 15 business days after the public adjuster receives the cancellation. The insurer's consent is not involved.

Reference: OAR 836-071-1165(8) and (9)

Correct answer: D. Only reasonable pay for time spent and expenses, not a percentage

OAR 836-071-1165(3) applies when the insurer, within 72 hours after the loss is reported, pays or commits in writing to pay the policy limit. The public adjuster then may not take a percentage commission, must tell the insured the recovery might not be increased, and is entitled only to reasonable compensation based on time spent and expenses incurred. The contract is not void, and no 10% cap appears in the rule.

Reference: OAR 836-071-1165(3)