69th OREGON LEGISLATIVE ASSEMBLY--1997 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 1862
House Bill 2653
Sponsored by COMMITTEE ON JUDICIARY (at the request of Joint
Interim Judiciary Committee)
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Provides that automobile insurance policies may provide for
arbitration of disputes over personal injury protection benefits
and uninsured and underinsured motorist benefits.
Provides that uninsured and underinsured motorist benefits
shall be paid according to amounts actually received by or on
behalf of injured person from tortfeasor's liability insurance
policy. Requires wrongdoer's liability limits to be exhausted by
payment of judgment or settlement before uninsured motorist
benefits become payable.
Provides that time within which to file action directly against
insurer for uninsured or underinsured motorist benefits is two
years from breach of policy, if policy does not provide for
arbitration.
Provides that PIP reimbursement shall not reduce uninsured or
underinsured motorist limits afforded by same policy.
Provides that health insurers are subject to ORS 742.544 and
its consideration of injured party's economic damages when
calculating extent to which injured party must reimburse health
benefits from insurance recovery.
Provides express list of permissible and prohibited exclusions
in automobile liability insurance policy under Financial
Responsibility Law.
A BILL FOR AN ACT
Relating to insurance; creating new provisions; and amending ORS
742.454, 742.502, 742.504, 742.520, 742.522, 742.542 and
742.544.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 742.502 is amended to read:
742.502. (1) Every motor vehicle liability policy insuring
against loss suffered by any natural person resulting from
liability imposed by law for bodily injury or death arising out
of the ownership, maintenance or use of a motor vehicle shall
provide therein or by indorsement thereon uninsured motorist
coverage when such policy is either:
(a) Issued for delivery in this state; or
(b) Issued or delivered by an insurer doing business in this
state with respect to any motor vehicle then principally used or
principally garaged in this state.
(2)(a) A motor vehicle bodily injury liability policy shall
have the same limits for uninsured motorist coverage as for
bodily injury liability coverage unless a named insured in
writing elects lower limits. The insured may not elect limits
lower than the amounts prescribed to meet the requirements of ORS
806.070 for bodily injury or death. Uninsured motorist coverage
larger than the amounts required by ORS 806.070 shall include
underinsurance coverage for damages or death caused by accident
and arising out of the ownership, maintenance or use of a motor
vehicle that is insured for an amount that is less than the
insured's uninsured motorist coverage. Underinsurance benefits
shall be equal to uninsured motorist coverage benefits less the
amount recovered from other automobile liability insurance
policies.
(b) A statement electing lower limits shall be signed and dated
by a named insured at the time a named insured elects lower
limits. The statement shall acknowledge that a named insured was
offered uninsured motorist coverage with the limits equal to
those for bodily injury liability. The statement shall contain a
brief summary, which shall not be construed as part of the
insurance contract, of what uninsured and underinsured motorist
coverages provide and shall state the price for coverage with
limits equal to the named insured's bodily injury liability
limits and the price for coverage with the lower limits requested
by the named insured. The statement shall remain in force until
rescinded in writing by a named insured or until such time as
motor vehicle bodily injury liability limits are changed. The
form of statement used to comply with this paragraph shall be
approved by the department.
(c) A statement electing lower limits need not be signed when
vehicles are either added to or subtracted from a policy or when
the policy is amended, renewed, modified or replaced by the same
company or group of companies under common ownership or control
unless the liability limits of the policy are changed.
(3) The insurer issuing such policy may offer one or more
options of uninsured motorist coverage larger than the amounts
prescribed to meet the requirements of ORS 806.070 and in excess
of the limits provided under the policy for motor vehicle bodily
injury liability insurance. Offers of uninsured motorist coverage
larger than the amounts required by ORS 806.070 shall include
underinsurance coverage for damages or death caused by accident
and arising out of the ownership, maintenance or use of a motor
vehicle { - that is insured for - } { + with liability
insurance that provides recovery in + } an amount that is less
than the insured's uninsured motorist coverage. Underinsurance
benefits shall be equal to uninsured motorist coverage benefits
less the amount recovered from other automobile liability
insurance policies.
(4) Underinsurance coverage shall be subject to ORS 742.504
{ + and ORS 742.542 + }.
{ + (5) Except as provided in this subsection, the 'amount
recovered from other automobile liability insurance policies '
means the proceeds of liability insurance recovered by or on
behalf of the injured party. Proceeds recovered on behalf of the
injured party include proceeds received by the injured party's
insurer as reimbursement for personal injury protection benefits
provided to the injured person, proceeds received by the medical
providers of the injured person and proceeds received as attorney
fees on the claim of the injured person. Where applicable
liability insurance policy limits are exhausted upon payment,
settlement or judgment by division among two or more injured
persons, the 'amount recovered from other automobile liability
insurance policies' means the proceeds that are recovered by or
on behalf of the injured person but does not include any proceeds
of that liability policy received by other injured persons. Where
applicable liability insurance policy limits are not exhausted
upon payment, settlement or judgment to injured parties because
the injured person settles or is awarded less than the available
liability limits, the motor vehicle with such liability coverage
is not an underinsured motor vehicle by reason of which
underinsurance coverage must be paid. + }
SECTION 2. ORS 742.504 is amended to read:
742.504. Every policy required to provide the coverage
specified in ORS 742.502 shall provide uninsured motorist
coverage which in each instance is no less favorable in any
respect to the insured or the beneficiary than if the following
provisions were set forth in the policy. However, nothing
contained in this section shall require the insurer to reproduce
in such policy the particular language of any of the following
provisions:
(1)(a) The insurer will pay all sums which the insured, the
heirs or the legal representative of the insured shall be legally
entitled to recover as general and special damages from the owner
or operator of an uninsured vehicle because of bodily injury
sustained by the insured caused by accident and arising out of
the ownership, maintenance or use of such uninsured vehicle.
Determination as to whether the insured, the insured's heirs or
the insured's legal representative is legally entitled to recover
such damages, and if so, the amount thereof, shall be made by
agreement between the insured and the insurer, or, in the event
of disagreement, { + may be made + } by arbitration { + if
provided in the policy + }.
(b) No judgment against any person or organization alleged to
be legally responsible for bodily injury, except for proceedings
instituted against the insurer as provided in this policy, shall
be conclusive, as between the insured and the insurer, on the
issues of liability of such person or organization or of the
amount of damages to which the insured is legally entitled.
(2) As used in this policy:
(a) 'Insured,' when unqualified, means when applied to
uninsured motorist coverage:
(A) The named insured as stated in the policy and any person
designated as named insured in the schedule and, while residents
of the same household, the spouse of any such named insured and
relatives of either; provided, neither such relative nor spouse
is the owner of a vehicle not described in the policy; and
provided further, if the named insured as stated in the policy is
other than an individual or husband and wife who are residents of
the same household, the named insured shall be only a person so
designated in the schedule;
(B) Any child residing in the household of the named insured if
the insured has performed the duties of a parent to the child by
rearing the child as the insured's own although the child is not
related to the insured by blood, marriage or adoption; and
(C) Any other person while occupying an insured vehicle
provided the actual use thereof is with the permission of the
named insured.
(b) 'Insured vehicle,' except as provided in paragraph (c) of
this provision, means:
(A) The vehicle described in the policy or a newly acquired or
substitute vehicle, as each of those terms is defined in the
public liability coverage of the policy, insured under the public
liability provisions of the policy; or
(B) A nonowned vehicle operated by the named insured or spouse
if a resident of the same household; provided the actual use
thereof is with the permission of the owner of such vehicle and
such vehicle is not owned by nor furnished for the regular or
frequent use of the insured or any member of the same household.
(c) 'Insured vehicle' does not include a trailer of any type
unless such trailer is a described vehicle in the policy.
(d) 'Uninsured vehicle,' except as provided in paragraph (e) of
this provision, means:
(A) A vehicle with respect to the ownership, maintenance or use
of which there is no collectible automobile bodily injury
liability insurance or bond, in at least the amounts or limits
prescribed for bodily injury or death under ORS 806.070
applicable at the time of the accident with respect to any person
or organization legally responsible for the use of such vehicle,
or with respect to which there is such collectible bodily injury
liability insurance or bond applicable at the time of the
accident but the insurance company writing the same denies
coverage thereunder or, within two years of the date of the
accident, such company writing the same becomes voluntarily or
involuntarily declared bankrupt or for which a receiver is
appointed or becomes insolvent. It shall be a disputable
presumption that a vehicle is uninsured in the event the insured
and the insurer, after reasonable efforts, fail to discover
within 90 days from the date of the accident, the existence of a
valid and collectible automobile bodily injury liability
insurance or bond applicable at the time of the accident.
(B) A hit-and-run vehicle as defined in paragraph (f) of this
provision.
(C) A phantom vehicle as defined in paragraph (g) of this
provision.
(e) 'Uninsured vehicle' does not include:
(A) An insured vehicle;
(B) A vehicle which is owned or operated by a self-insurer
within the meaning of any motor vehicle financial responsibility
law, motor carrier law or any similar law;
(C) A vehicle which is owned by the United States of America,
Canada, a state, a political subdivision of any such government
or an agency of any of the foregoing;
(D) A land motor vehicle or trailer, if operated on rails or
crawler-treads or while located for use as a residence or
premises and not as a vehicle;
(E) A farm-type tractor or equipment designed for use
principally off public roads, except while actually upon public
roads; or
(F) A vehicle owned by or furnished for the regular or frequent
use of the insured or any member of the household of the insured.
(f) 'Hit-and-run vehicle' means a vehicle which causes bodily
injury to an insured arising out of physical contact of such
vehicle with the insured or with a vehicle which the insured is
occupying at the time of the accident, provided:
(A) There cannot be ascertained the identity of either the
operator or the owner of such hit-and-run vehicle;
(B) The insured or someone on behalf of the insured shall have
reported the accident within 72 hours to a police, peace or
judicial officer, to the Department of Transportation of the
State of Oregon or to the equivalent department in the state
where the accident occurred, and shall have filed with the
insurer within 30 days thereafter a statement under oath that the
insured or the legal representative of the insured has a cause or
causes of action arising out of such accident for damages against
a person or persons whose identity is unascertainable, and
setting forth the facts in support thereof; and
(C) At the insurer's request, the insured or the legal
representative of the insured makes available for inspection the
vehicle which the insured was occupying at the time of the
accident.
(g) 'Phantom vehicle' means a vehicle which causes bodily
injury to an insured arising out of a motor vehicle accident
which is caused by an automobile which has no physical contact
with the insured or the vehicle which the insured is occupying at
the time of the accident, provided:
(A) There cannot be ascertained the identity of either the
operator or the owner of such phantom vehicle;
(B) The facts of such accident can be corroborated by competent
evidence other than the testimony of the insured or any person
having an uninsured motorist claim resulting from the accident;
and
(C) The insured or someone on behalf of the insured shall have
reported the accident within 72 hours to a police, peace or
judicial officer, to the Department of Transportation of the
State of Oregon or to the equivalent department in the state
where the accident occurred, and shall have filed with the
insurer within 30 days thereafter a statement under oath that the
insured or the legal representative of the insured has a cause or
causes of action arising out of such accident for damages against
a person or persons whose identity is unascertainable, and
setting forth the facts in support thereof.
(h) 'Bodily injury' means bodily injury, sickness or disease,
including death resulting therefrom.
(i) 'Occupying' means in or upon or entering into or alighting
from.
(j) 'State' includes the District of Columbia, a territory or
possession of the United States and a province of Canada.
(k) 'Vehicle' means every device in, upon or by which any
person or property is or may be transported or drawn upon a
public highway, but does not include devices moved by human power
or used exclusively upon stationary rails or tracks.
(3) This coverage applies only to accidents which occur on and
after the effective date of the policy, during the policy period
and within the United States of America, its territories or
possessions, or Canada.
(4)(a) This coverage does not apply to bodily injury of an
insured with respect to which such insured or the legal
representative of the insured shall, without the written consent
of the insurer, make any settlement with or prosecute to judgment
any action against any person or organization who may be legally
liable therefor.
(b) This coverage does not apply to bodily injury to an insured
while occupying a vehicle (other than an insured vehicle) owned
by, or furnished for the regular use of, the named insured or any
relative resident in the same household, or through being struck
by such a vehicle.
(c) This coverage does not apply so as to inure directly or
indirectly to the benefit of any workers' compensation carrier,
any person or organization qualifying as a self-insurer under any
workers' compensation or disability benefits law or any similar
law or the State Accident Insurance Fund Corporation.
{ + (d) This coverage does not apply with respect to
underinsured motorist benefits unless the limits of liability
under any bodily injury liability bonds or policies applicable at
the time of the accident regarding the injured person have been
exhausted by payment of judgments or settlements to the injured
person or other injured persons. + }
(5)(a) As soon as practicable, the insured or other person
making claim shall give to the insurer written proof of claim,
under oath if required, including full particulars of the nature
and extent of the injuries, treatment and other details entering
into the determination of the amount payable hereunder. The
insured and every other person making claim hereunder shall
submit to examinations under oath by any person named by the
insurer and subscribe the same, as often as may reasonably be
required. Proof of claim shall be made upon forms furnished by
the insurer unless the insurer shall have failed to furnish such
forms within 15 days after receiving notice of claim.
(b) Upon reasonable request of and at the expense of the
insurer, the injured person shall submit to physical examinations
by physicians selected by the insurer and shall, upon each
request from the insurer, execute authorization to enable the
insurer to obtain medical reports and copies of records.
(6) If, before the insurer makes payment of loss hereunder, the
insured or the legal representative of the insured shall
institute any legal action for bodily injury against any person
or organization legally responsible for the use of a vehicle
involved in the accident, a copy of the summons and complaint or
other process served in connection with such legal action shall
be forwarded immediately to the insurer by the insured or the
legal representative of the insured.
(7)(a) The limit of liability stated in the declarations as
applicable to 'each person' is the limit of the insurer's
liability for all damages because of bodily injury sustained by
one person as the result of any one accident and, subject to the
above provision respecting each person, the limit of liability
stated in the declarations as applicable to 'each accident' is
the total limit of the company's liability for all damages
because of bodily injury sustained by two or more persons as the
result of any one accident.
(b) Any payment made under this coverage to or for an insured
shall be applied in reduction of any amount which the insured may
be entitled to recover from any person who is an insured under
the bodily injury liability coverage of this policy { + . + }
{ - ; and - }
(c) Any amount payable under the terms of this coverage because
of bodily injury sustained in an accident by a person who is an
insured under this coverage shall be reduced by:
(A) All sums paid on account of such bodily injury by or on
behalf of the owner or operator of the uninsured vehicle and by
or on behalf of any other person or organization jointly or
severally liable together with such owner or operator for such
bodily injury including all sums paid under the bodily injury
liability coverage of the policy; and
(B) The amount paid and the present value of all amounts
payable on account of such bodily injury under any workers'
compensation law, disability benefits law or any similar law.
(8) No action shall lie against the insurer unless, as a
condition precedent thereto, the insured or the legal
representative of the insured has fully complied with all the
terms of this policy.
(9)(a) Except as provided in paragraph (c) of this subsection,
with respect to bodily injury to an insured while occupying a
vehicle not owned by a named insured under this coverage, the
insurance under this coverage shall apply only as excess
insurance over any other insurance available to such occupant
which is similar to this coverage, and this insurance shall then
apply only in the amount by which the applicable limit of
liability of this coverage exceeds the sum of the applicable
limits of liability of all such other insurance.
(b) With respect to bodily injury to an insured while occupying
or through being struck by an uninsured vehicle, if such insured
is an insured under other insurance available to the insured
which is similar to this coverage, then the damages shall be
deemed not to exceed the higher of the applicable limits of
liability of this insurance or such other insurance, and the
insurer shall not be liable under this coverage for a greater
proportion of the damages than the applicable limit of liability
of this coverage bears to the sum of the applicable limits of
liability of this insurance and such other insurance.
(c) With respect to bodily injury to an insured while occupying
any motor vehicle used as a public or livery conveyance, the
insurance under this coverage shall apply only as excess
insurance over any other insurance available to the insured which
is similar to this coverage, and this insurance shall then apply
only in the amount by which the applicable limit of liability of
this coverage exceeds the sum of the applicable limits of
liability of all such other insurance.
(10) If any person making claim hereunder and the insurer do
not agree that such person is legally entitled to recover damages
from the owner or operator of an uninsured vehicle because of
bodily injury to the insured, or do not agree as to the amount of
payment which may be owing under this coverage, then, in the
event the insured or the insurer elects to settle the matter by
arbitration, { + as may be provided by the policy, + } the
arbitration shall take place under the arbitration laws of the
State of Oregon and any judgment upon the award rendered by the
arbitrators may be entered in any court having jurisdiction
thereof provided, however, the costs to the insured of the
arbitration proceeding shall not exceed $100 and that all other
costs of arbitration shall be borne by the insurer. 'Costs' as
used in this provision shall not include attorney fees or
expenses incurred in the production of evidence or witnesses or
the making of transcripts of the arbitration proceedings. Such
person and the insurer each agree to consider themselves bound
and to be bound by any award made by the arbitrators pursuant to
this coverage in the event of such election { + if arbitration
has been made a provision of the policy + }. At the election of
the insured, such arbitration shall be held:
(a) In the county and state of residence of the insured;
(b) In the county and state where the insured's cause of action
against the uninsured motorist arose; or
(c) At any other place mutually agreed upon by the insured and
the insurer.
(11) In the event of payment to any person under this coverage:
(a) The insurer shall be entitled to the extent of such payment
to the proceeds of any settlement or judgment that may result
from the exercise of any rights of recovery of such person
against any uninsured motorist legally responsible for the bodily
injury because of which such payment is made;
(b) Such person shall hold in trust for the benefit of the
insurer all rights of recovery which the person shall have
against such other uninsured person or organization because of
the damages which are the subject of claim made under this
coverage, but only to the extent that such claim is made or paid
herein;
(c) If the insured is injured by the joint or concurrent act or
acts of two or more persons, one or more of whom is uninsured,
the insured shall have the election to receive from the insurer
any payment to which the insured would be entitled under this
coverage by reason of the act or acts of the uninsured motorist,
or the insured may, with the written consent of the insurer,
proceed with legal action against any or all persons claimed to
be liable to the insured for such injuries. If the insured elects
to receive payment from the insurer under this coverage, then the
insured shall hold in trust for the benefit of the insurer all
rights of recovery the insured shall have against any other
person, firm or organization because of the damages which are the
subject of claim made under this coverage, but only to the extent
of the actual payment made by the insurer;
(d) Such person shall do whatever is proper to secure and shall
do nothing after loss to prejudice such rights;
(e) If requested in writing by the insurer, such person shall
take, through any representative not in conflict in interest with
such person, designated by the insurer, such action as may be
necessary or appropriate to recover such payment as damages from
such other uninsured person or organization, such action to be
taken in the name of such person, but only to the extent of the
payment made hereunder. In the event of a recovery, the insurer
shall be reimbursed out of such recovery for expenses, costs and
attorney fees incurred by it in connection therewith; and
(f) Such person shall execute and deliver to the insurer such
instruments and papers as may be appropriate to secure the rights
and obligations of such person and the insurer established by
this provision.
(12) The parties to this coverage agree that no cause of action
shall accrue to the insured under this coverage { + :
(a) + } Unless within two years from the date of the accident:
{ - (a) - } { + (A) + } Suit for bodily injury has been
filed against the uninsured motorist, in a court of competent
jurisdiction;
{ - (b) - } { + (B) + } Agreement as to the amount due
under the policy has been concluded; or
{ - (c) - } { + (C) + } The insured or the insurer has
formally instituted arbitration proceedings { + if arbitration
is required by the policy; or
(b) If arbitration is not required by the policy, unless within
two years from the date of the insurer's breach of the policy,
the insured has filed an action against the insurer in a court of
competent jurisdiction + }.
SECTION 3. ORS 742.520 is amended to read:
742.520. (1) Every motor vehicle liability policy issued for
delivery in this state that covers any private passenger motor
vehicle shall provide personal injury protection benefits to the
person insured thereunder, members of that person's family
residing in the same household, children not related to the
insured by blood, marriage or adoption who are residing in the
same household as the insured and being reared as the insured's
own, passengers occupying the insured motor vehicle and
pedestrians struck by the insured motor vehicle. 'Personal injury
protection benefits' means the benefits described in this section
and ORS 742.524 and 742.530.
(2) Personal injury protection benefits apply to a person's
injury or death resulting:
(a) In the case of the person insured under the policy and
members of that person's family residing in the same household,
from the use, occupancy or maintenance of any motor vehicle,
except the following vehicles:
(A) A motor vehicle, including a motorcycle or moped, which is
owned by any of such persons and which is not covered by a motor
vehicle liability insurance policy that provides personal injury
protection benefits with respect to the use, occupancy and
maintenance of that vehicle;
(B) A motorcycle or moped which is not owned by any of such
persons, but this exclusion applies only when the injury or death
results from such person's operating or riding upon the
motorcycle or moped; and
(C) A motor vehicle not included in subparagraph (A) or (B) of
this paragraph and not a private passenger motor vehicle.
However, this exclusion applies only when the injury or death
results from such person's operating or occupying the motor
vehicle.
(b) In the case of a passenger occupying or a pedestrian struck
by the insured motor vehicle, from the use, occupancy or
maintenance of the vehicle.
(3) Personal injury protection benefits consist of payments for
expenses, loss of income and loss of essential services as
provided in ORS 742.524.
(4) An insurer shall pay all personal injury protection
benefits promptly after proof of loss has been submitted to the
insurer.
(5) The potential existence of a cause of action in tort does
not relieve an insurer from the duty to pay personal injury
protection benefits.
(6) Disputes between insurers and beneficiaries about the
amount of personal injury protection benefits, or about the
denial of personal injury protection benefits, shall be decided
by arbitration { + , if arbitration is provided by the
policy, + } except that if all requirements for bringing an
action in the small claims department of a justice or district
court are met, the insured may elect to file such an action
rather than submitting the claim to arbitration.
(7) As used in ORS 742.520 to 742.542:
(a) 'Motor vehicle' means a self-propelled land motor vehicle
or trailer, other than:
(A) A farm type tractor or other self-propelled equipment
designed for use principally off public roads, while not upon
public roads;
(B) A vehicle operated on rails or crawler-treads; or
(C) A vehicle located for use as a residence or premises.
(b) 'Motorcycle' and 'moped' have the meanings given those
terms in ORS 801.345 and 801.365.
(c) 'Occupying' means in, or upon, or entering into or
alighting from.
(d) 'Pedestrian' means a person while not occupying a
self-propelled vehicle.
(e) 'Private passenger motor vehicle' means a four-wheel
passenger or station wagon type motor vehicle not used as a
public or livery conveyance, and includes any other four-wheel
motor vehicle of the utility, pickup body, sedan delivery or
panel truck type not used for wholesale or retail delivery other
than farming, a self-propelled mobile home, and a farm truck.
SECTION 4. ORS 742.520, as amended by section 114, chapter 658,
Oregon Laws 1995, is amended to read:
742.520. (1) Every motor vehicle liability policy issued for
delivery in this state that covers any private passenger motor
vehicle shall provide personal injury protection benefits to the
person insured thereunder, members of that person's family
residing in the same household, children not related to the
insured by blood, marriage or adoption who are residing in the
same household as the insured and being reared as the insured's
own, passengers occupying the insured motor vehicle and
pedestrians struck by the insured motor vehicle. 'Personal injury
protection benefits' means the benefits described in this section
and ORS 742.524 and 742.530.
(2) Personal injury protection benefits apply to a person's
injury or death resulting:
(a) In the case of the person insured under the policy and
members of that person's family residing in the same household,
from the use, occupancy or maintenance of any motor vehicle,
except the following vehicles:
(A) A motor vehicle, including a motorcycle or moped, which is
owned by any of such persons and which is not covered by a motor
vehicle liability insurance policy that provides personal injury
protection benefits with respect to the use, occupancy and
maintenance of that vehicle;
(B) A motorcycle or moped which is not owned by any of such
persons, but this exclusion applies only when the injury or death
results from such person's operating or riding upon the
motorcycle or moped; and
(C) A motor vehicle not included in subparagraph (A) or (B) of
this paragraph and not a private passenger motor vehicle.
However, this exclusion applies only when the injury or death
results from such person's operating or occupying the motor
vehicle.
(b) In the case of a passenger occupying or a pedestrian struck
by the insured motor vehicle, from the use, occupancy or
maintenance of the vehicle.
(3) Personal injury protection benefits consist of payments for
expenses, loss of income and loss of essential services as
provided in ORS 742.524.
(4) An insurer shall pay all personal injury protection
benefits promptly after proof of loss has been submitted to the
insurer.
(5) The potential existence of a cause of action in tort does
not relieve an insurer from the duty to pay personal injury
protection benefits.
(6) Disputes between insurers and beneficiaries about the
amount of personal injury protection benefits, or about the
denial of personal injury protection benefits, shall be decided
by arbitration { + , if arbitration is provided by the
policy, + } except that if all requirements for bringing an
action in the small claims department of a justice or circuit
court are met, the insured may elect to file such an action
rather than submitting the claim to arbitration.
(7) As used in ORS 742.520 to 742.542:
(a) 'Motor vehicle' means a self-propelled land motor vehicle
or trailer, other than:
(A) A farm type tractor or other self-propelled equipment
designed for use principally off public roads, while not upon
public roads;
(B) A vehicle operated on rails or crawler-treads; or
(C) A vehicle located for use as a residence or premises.
(b) 'Motorcycle' and 'moped' have the meanings given those
terms in ORS 801.345 and 801.365.
(c) 'Occupying' means in, or upon, or entering into or
alighting from.
(d) 'Pedestrian' means a person while not occupying a
self-propelled vehicle.
(e) 'Private passenger motor vehicle' means a four-wheel
passenger or station wagon type motor vehicle not used as a
public or livery conveyance, and includes any other four-wheel
motor vehicle of the utility, pickup body, sedan delivery or
panel truck type not used for wholesale or retail delivery other
than farming, a self-propelled mobile home, and a farm truck.
SECTION 5. { + Nothing in the amendments to ORS 742.520 by
section 3 or 4 of this Act affects the operative date provisions
of sections 129 and 150, chapter 658, Oregon Laws 1995. + }
SECTION 6. ORS 742.522 is amended to read:
742.522. (1) Arbitration under ORS 742.520 (6) is binding on
the parties to the arbitration { + if arbitration is provided by
the policy + }.
(2) Costs to the insured of the arbitration proceeding shall
not exceed $100 and all other costs of arbitration shall be borne
by the insurer. As used in this subsection, 'costs' does not
include attorney fees or expenses incurred in the production of
evidence or witnesses or the making of transcripts of the
arbitration proceedings.
SECTION 7. ORS 742.542 is amended to read:
742.542. Payment by a motor vehicle liability insurer of
personal injury protection benefits for its own insured shall be
applied in reduction of the amount of damages that the insured
may be entitled to recover from the insurer under uninsured
{ + or underinsured + } motorist coverage for the same accident
but may not be applied in reduction of the uninsured { + or
underinsured + } motorist coverage policy limits.
SECTION 8. ORS 742.544 is amended to read:
742.544. (1) A provider of personal injury protection benefits
{ + or a health insurer + } shall be reimbursed { + for health
insurance benefits or + } for personal injury protection payments
made on behalf of any person only to the extent that the total
amount of benefits paid exceeds the economic damages as defined
in ORS 18.560 suffered by that person. As used in this section,
'total amount of benefits' means the amount of money recovered by
a person from:
(a) Applicable { + uninsured or + } underinsured motorist
benefits described in ORS 742.502 (2);
(b) Liability insurance coverage available to the person
receiving the personal injury protection benefits from other
parties to the accident;
(c) Personal injury protection payments; and
(d) Any other payments by or on behalf of the party whose fault
caused the damages.
(2) Nothing in this section requires a person to repay more
than the amount of personal injury protection benefits actually
received.
{ + (3) Nothing in this section shall impair, affect or limit
the rights and obligations of the insurer or the injured insured
person under ORS 742.542. + }
SECTION 9. ORS 742.454 is amended to read:
742.454. { - The motor vehicle liability insurance policy
required by ORS 806.010, 806.060, 806.080, 806.240 or 806.270
need not insure any liability under any workers' compensation
law; nor any liability on account of bodily injury to or death of
an employee of the insured while engaged in the employment, other
than domestic, of the insured, or while engaged in the operation,
maintenance or repair of a vehicle; nor any liability for damage
to property owned by, rented to, in charge of, or transported by
the insured. - }
{ + (1) The motor vehicle liability insurance policy required
by ORS 806.010, 806.060, 806.080, 806.240 or 806.270 need not
insure:
(a) Any liability under any workers' compensation law.
(b) Any liability on account of bodily injury to or death of an
employee of the insured while engaged in the employment, other
than domestic, of the insured or any liability for damage to
property of the employee.
(c) Any liability of a person who is engaged in the business or
occupation of selling, repairing, servicing, road testing,
delivering, storing or parking of a vehicle. The limitation
described in this paragraph does not apply to the named insured
or to any covered member of the insured's household.
(d) Any liability for damage to property owned by, rented to,
in the charge of or transported by the insured.
(e) Any liability of any person who intentionally causes or
directs another person to cause bodily injury or property damage.
(f) Any liability of any person arising out of the ownership or
operation of a motor vehicle while it is being used to carry
persons or property for a charge or fee. The limitation described
in this paragraph does not apply to an expense-sharing car pool,
or to a circumstance in which an employee receives a wage, salary
or reimbursement for mileage expense, if the employee is not
engaged in the business of making deliveries of persons or
property. The limitation described in this paragraph shall not be
effective in any policy issued to a commercial enterprise,
corporation, partnership, sole proprietorship, nonprofit
corporation or association that carries persons or property for a
charge or fee.
(g) Any liability of any person using a vehicle without an
objectively reasonable belief that the person is entitled to do
so.
(h) Any liability of any person resulting from the ownership,
maintenance or use of any vehicle, other than a vehicle insured
under the terms of the policy, that is owned by or furnished or
available for regular use by the named insured, family member or
household resident.
(i) Any liability incurred while a vehicle is being used to
prepare for or to participate in any prearranged or organized
racing, speed, stunt or demolition contest.
(j) Any liability for which a person is an insured under
nuclear energy liability insurance.
(k) Any liability for punitive or exemplary damages.
(2) The motor vehicle liability insurance policy required by
ORS 806.010, 806.060, 806.080, 806.240 or 806.270 shall not
exclude or reduce the applicable coverage limits with regard to:
(a) Any liability for bodily injury to an insured person.
(b) Any liability for bodily injury to a person who is a
resident of the household of the named insured.
(c) Any liability of a permissive driver of an insured vehicle,
except as permitted by ORS 742.450 (5) and (6). + }
SECTION 10. { + (1) Except as provided in subsection (2) of
this section, the amendments to statute sections by this Act
apply to insurance policies issued or renewed on and after the
effective date of this Act.
(2) The amendments to ORS 742.542 and 742.544 by sections 7 and
8 of this Act apply to accidents occurring on and after the
effective date of this Act. + }
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