Chapter 742

742.001

NOTES OF DECISIONS

General intention of legislature is to permit insured party who prevails in action in Oregon courts to collect attorney fees even when insurance policy is issued or delivered in another state. Morgan v. Amex Assurance Company, 352 Or 363, 287 P3d 1038 (2012)

742.003

(formerly 743.006)

See also annotations under ORS 743.006 in permanent edition.

NOTES OF DECISIONS

Failure to file policy endorsement does not render endorsement invalid. Gifford v. Western Aviation Ins. Group, 77 Or App 645, 713 P2d 1085 (1986)

Approval of form by Director of Department of Consumer and Business Services does not prevent court from reviewing form for compliance with statutory requirements. Fleming v. United Services Automobile Association, 330 Or 62, 996 P2d 501 (2000)

742.013

(formerly 743.042)

See also annotations under ORS 743.042 in permanent edition.

NOTES OF DECISIONS

Not reliance alone, but reliance where there is right to rely will relieve party from another’s fraud under this section. Kubeck v. Consol. Underwriters, 267 Or 548, 517 P2d 1039 (1974)

Incorrect answers on the insurance application were not material as matter of law. Santilli v. State Farm Life Ins. Co., 278 Or 53, 562 P2d 965 (1977)

Insurer has no duty to investigate representations of policy application where application is incomplete on its face unless omissions are so obviously material that reliance on incomplete application would be reckless. Kraus v. Prudential Ins. Co. of America, 799 F2d 502 (1986)

Where affidavit of Pacific Hospital Association’s (PHA) executive vice president states that omitted condition from health insurance application was material to acceptance of risk, PHA relied on accuracy of plaintiff’s information in issuing earlier policy and court did not err in granting summary judgment. Martin v. Pacific Hospital Assoc., 101 Or App 37, 788 P2d 1029 (1990)

Where typewritten version did not vary materially from original and statutes do not require “copy” be signed and insured signed Part II of typewritten version, thereby affirming all parts, unsigned typewritten attachment to policy was “copy” of original signed, handwritten application. Ives v. INA Life Ins. Co., 101 Or App 429, 790 P2d 1206 (1990), Sup Ct review denied

To establish reliance on representations, insurer must show reliance in fact; reliance that was justified in light of facts known to insurer at time; and insurer’s right to rely on representations. Story v. Safeco Life Insurance Co., 179 Or App 688, 40 P3d 1112 (2002)

Where insurer makes prima facie showing of reasonable reliance on insured’s representation, insured has burden to show insurer knew facts that revealed falsity of representation or should have led insurer to learn falsity of representation. Story v. Safeco Life Insurance Co., 179 Or App 688, 40 P3d 1112 (2002)

For copy of application to be “indorsed upon” policy, material information from application must be inscribed or otherwise reproduced on policy itself. Brock v. State Farm Mutual Automobile Insurance Co., 195 Or App 519, 98 P3d 759 (2004)

To deny coverage based on misrepresentation in application, indorsement upon, or attachment to, insurance policy must be sufficient to fully and precisely apprise applicant of information being relied upon by insurer in issuing policy. Brock v. State Farm Mutual Automobile Insurance Co., 195 Or App 519, 98 P3d 759 (2004)

742.016

(formerly 743.045)

See also annotations under ORS 743.045 in permanent edition.

NOTES OF DECISIONS

Where application that plaintiff signed and which was part of insurance contract provided policy could be canceled if plaintiff omitted any material preexisting health condition and plaintiff failed to list breast condition, Pacific Hospital Association could cancel policy. Martin v. Pacific Hospital Assoc., 101 Or App 37, 788 P2d 1029 (1990)

742.018

LAW REVIEW CITATIONS: 38 WLR 397 (2002)

742.031

(formerly 743.783, then 743.772)

See also annotations under ORS 743.783 in permanent edition.

NOTES OF DECISIONS

Evidence proffered by automobile insurer was insufficient to prove that its insured willfully avoided cooperation in defending personal injury action, and thus person injured by insured in automobile accident was entitled to recover from insurer under this section. Rosalez v. Unigard Insurance Co., 283 Or 63, 581 P2d 945 (1978)

This section requires that every insurance contract contain clause allowing judgment creditor to proceed against insurance company. NW Marine Iron v. Western Casualty, 45 Or App 269, 608 P2d 199 (1980), Sup Ct review denied

742.038

(formerly 743.069)

NOTES OF DECISIONS

Under circumstances, insurance contract provision limiting coverage for dental services to expenses incurred within 90 days of accidental injury was not contrary to public policy and void but trial court erred in striking plaintiff’s allegation that 90-day limitation negated statutorily required coverage of maxillofacial prosthetic services allegedly received. Allen v. Pacific Hospital Assoc., 91 Or App 356, 757 P2d 428 (1988)

742.043

(formerly 743.075)

NOTES OF DECISIONS

In circumstances where an oral binder and an issued policy are not substantially the same, the oral binder allowing greater coverage, a plaintiff will be limited to recovery on the policy. Farley v. United Pac. Ins. Co., 269 Or 549, 525 P2d 1003 (1974)

Insurer, who wished to exclude renter pilot as insured under binder, should have designated specified provision in binder as indorsement or by clear and express terms in binder excluded renter pilot as insured. Avemco Ins. Co. v. Hill, 76 Or App 185, 708 P2d 640 (1985)

742.061

(formerly 743.114)

See also annotations under ORS 743.114 in permanent edition.

NOTES OF DECISIONS

Lack of specificity regarding amount of damages does not forestall commencement of six-month settlement period. State Hwy. Comm. v. DeLong Corp., 9 Or App 550, 495 P2d 1215 (1972), Sup Ct review denied

If contingent fee agreement makes no specific reference to any possible attorney fees which may be awarded by court and makes no specific provision for manner in which any such fee is to be considered in computing the amount, source and manner of distribution of contingent fee, any attorney fees awarded by court shall be offset as a credit or deduction from the amount of the agreed contingent fee, as computed upon the basis of amount of the judgment. Chalmers v. Ore. Auto. Ins. Co., 263 Or 449, 502 P2d 1378 (1972)

The fact that plaintiff’s attorneys in the case are engaged on a contingent fee basis does not bar an allowance of attorney fees. Chalmers v. Ore. Auto. Ins. Co., 263 Or 449, 502 P2d 1378 (1972)

Where the insured seeks both declaratory relief and a money judgment under an insurance policy, attorney fees may be allowed. Cornell, Howland, Hayes, & M., Inc. v. Continental Cas. Co., 465 F2d 22 (1972)

This section was not intended to apply to any situation where an insurer, as an innocent stakeholder, is willing to pay policy proceeds to whomever they might belong. Gore v. Prudential Ins. Co. of Am., 265 Or 12, 507 P2d 20 (1973)

Since this section equates attorney fees with costs, 20-day deadline specified by ORS 20.320 for filing verified statement of costs and disbursements applies. State ex rel. Town Concrete Pipe, Inc. v. Andersen, 265 Or 593, 510 P2d 564 (1973)

In action on surety performance bond prevailing party bears the burden of proving amount and reasonableness of attorney fees. City of Hillsboro ex rel Lenchitsky Heating and Air Conditioning, Inc. v. Maintenance and Constr. Serv., Inc., 269 Or 169, 523 P2d 1036 (1974)

Where insurer is estopped from making assertions denying coverage, recovery on estoppel is recovery on policy and therefore qualifies for attorney fees. Farley v. United Pacific Ins. Co., 269 Or 549, 525 P2d 1003 (1974)

Liability for attorney fees cannot be avoided merely because the litigation was cast in the form of a declaratory judgment proceeding. Hartford v. Aetna/Mt. Hood Radio, 270 Or 226, 527 P2d 406 (1974)

Where there was no bad faith refusal of liability insurer to settle, in that insurer satisfied entire judgment which was in excess of policy limits, this section provided no authority to award attorney fees. Kricar, Inc. v. Gen. Acc., Fire and Life Assur. Corp., 542 F2d 1135 (1976)

The claimant under an insurance policy is entitled to the attorney fees if he establishes a claim for more than the tendered amount on his initiative, either as a plaintiff or defendant who emerges with a money “recovery” in his favor. Travelers Ins. Co. v. Plummer, 278 Or 387, 563 P2d 1218 (1977)

Appellant obtaining remand is not entitled to attorney fees and costs incurred on appeal unless also prevailing at trial following remand. Stanford v. American Guaranty Life Insurance Company, 281 Or 325, 574 P2d 646 (1978)

In action against insurance agency to recover losses for agency’s negligent failure to procure insurance for claimant, defendant was not an insurer and thus claimant was not entitled to award of attorney fees. Monsantofils v. Gacek Insurance Agency, 282 Or 3, 576 P2d 789 (1978)

In order to secure attorney fees under this section, insured must recover money judgment against insurer; it is not sufficient that insured establish coverage which may in turn lead to subsequent recovery of money. McGraw v. Gwinner, 282 Or 393, 578 P2d 1250 (1978); distinguished in Long v. Farmers, 360 Or 791, 388 P3d 312 (2017)

Plaintiff’s excess insurer was entitled to attorney fees under this section when primary insurer refused, in bad faith, to pay claim. Portland Gen. Electric Co. v. Pacific Idem. Co., 579 F2d 514 (1978)

Insurer acting as assignee of contractual right rather than subrogee may recover attorney fees. Fisk v. Dairyland Ins. Co., 42 Or App 777, 601 P2d 868 (1979)

Judgment creditors may recover attorney fees. Rowley v. Dairyland Ins. Co., 44 Or App 333, 605 P2d 1356 (1980); NW Marine Iron v. Western Casualty, 45 Or App 269, 608 P2d 199 (1980), Sup Ct review denied

Excess carrier who defended claim after primary carrier declined defense was subrogated to rights of insured and could recover attorney fees pursuant to this section. Sch. Dist. No. 1 v. Mission Ins. Co., 58 Or App 692, 650 P2d 929 (1982), Sup Ct review denied

Where policy for dredge owner covering liability for pollution under Federal Water Pollution Control Act was more nearly analogous to “general marine” type than to “wet marine” type, attorney fees may be awarded. Port of Portland v. Water Quality Insurance Syndicate, 549 F Supp 233 (1982)

Where plaintiff settled claim against defendant for full amount of policy limits, then litigated with insurer whether advance payments should be included in those limits, plaintiff is entitled to recover from insurer attorney fees incurred in litigation. Kessler v. Weigandt, 73 Or App 48, 697 P2d 574 (1985), Sup Ct review denied

Although Washington law governed substantive insurance issues, attorney fees were awardable as procedural matter subject to Oregon law. Vancouver Furniture v. Industrial Indemnity, 74 Or App 642, 704 P2d 518 (1985), Sup Ct review denied

Where insurer settled within six weeks from date of proof of loss, but then filed adversary proceedings, sought injunction and asked for constructive trust throughout remainder of six-month statutory period, prerequisite for award of attorney fees was not met. American Universal Ins. Co., v. Pugh, 821 F2d 1352 (1987)

Court’s striking of allegation for attorney fees, incurred by plaintiff in arbitration proceeding, was not reviewable by appellate court after action on policy, in which plaintiff sought fees, was dismissed without prejudice. Rossi v. State Farm Mutual Auto Ins. Co., 90 Or App 589, 752 P2d 1298 (1988), Sup Ct review denied

Where general contractor for installation of fire sprinkling system brought action for declaratory relief that its insurer was required to defend property owner’s action against general contractor and subcontractors to recover for damage to tank and reservoir site, general contractor not entitled to attorney’s fees because it had not recovered money judgment against insurer. Fireguard Sprinkler Systems v. Scottsdale Ins., 864 F 2d 648 (9th Cir. 1988)

Where defendant made timely settlement tender and this section did not require that settlement offer be made before commencement of litigation nor allow for award of fees incurred before offer, trial court erred in awarding plaintiff attorney fees. Durflinger v. Statesman Life Ins. Co., 100 Or App 581, 787 P2d 892 (1990)

Although action against insurance company was abated and arbitrators established gross amount of damages suffered by plaintiffs in automobile accident, court subsequently decided in favor of plaintiffs on legal issues raised by defendant insurance company in affirmative defenses and counterclaim so plaintiffs were entitled to attorney fees. Wick v. Viking Ins. Co., 105 Or App 33, 803 P2d 1199 (1990)

Tender must be absolute and unconditional, except that tender may be accompanied by condition on which tendering party has right to insist. Gardner v. Cox, 117 Or App 57, 843 P2d 469 (1992)

Attorney fees incurred before action on insurance policy is filed are recoverable if reasonably related to action. Farmers Ins. Co. v. Trutanich, 123 Or App 6, 858 P2d 1332 (1993)

Recovery of attorney fees is not limited to cases involving coverage disputes. Douglass v. Allstate Ins. Co., 152 Or App 216, 953 P2d 770 (1998), Sup Ct review denied

Tender in excess of plaintiff’s recovery does not preclude award of attorney fees if not made within six months from date of proof of loss. Petersen v. Farmers Insurance Co., 162 Or App 462, 986 P2d 659 (1999)

“Proof of loss” means any event or submission that would permit insurer to estimate obligations. Dockins v. State Farm Insurance Co., 329 Or 20, 985 P2d 796 (1999); Scott v. State Farm Mutual Automobile Insurance Co., 345 Or 146, 190 P3d 372 (2008)

Proof of loss submitted less than six months prior to litigation is effective to commence running of six-month period for settlement without attorney fees. Dockins v. State Farm Insurance Co., 329 Or 20, 985 P2d 796 (1999); Wilson v. Tri-Met, 234 Or App 615, 228 P3d 1225 (2010), Sup Ct review denied

“Tender” means timely, unconditional offer of payment made before or after commencement of litigation. Dockins v. State Farm Insurance Co., 329 Or 20, 985 P2d 796 (1999)

In suit brought to enforce insurer compliance with policy, attorney fees are available notwithstanding that plaintiff may be person other than insured. Webb v. National Union Fire Insurance Company of Pittsburgh, 207 F3d 579 (9th Cir. 2000)

Self-insurer providing uninsured motorist coverage is insurer for purposes of being subject to payment of attorney fees for insurer’s failure to make settlement within six months following proof of loss. Haynes v. Tri-County Metropolitan Transportation District of Oregon, 337 Or 659, 103 P3d 101 (2004)

Successful defendant need not have made tender to settle action against contractor or subcontractor bond in order for defendant to be entitled to attorney fees. North Marion School District #15 v. Acstar Insurance Co., 206 Or App 593, 138 P3d 876 (2006)

Dispute over insurer’s denial of particular claim for benefits is not dispute over “amount of benefits.” Grisby v. Progressive Preferred Insurance Co., 343 Or 175, 166 P3d 519 (2007), modified 343 Or 394, 171 P3d 352 (2007)

Dispute over enforceability of insurer’s release from rights, claims, demands or damages that result from accident is not dispute over “amount of benefits.” Cardenas v. Farmers Insurance Co., 230 Or App 403, 215 P3d 919 (2009)

“Proof of loss” does not need to be in writing. Parks v. Farmers Insurance Co., 347 Or 374, 227 P3d 1127 (2009)

Multiplier or other fee enhancement may be used to calculate reasonable attorney fees for work done at trial or on appeal or work done before an appellate court sitting pursuant to its original jurisdiction. Strawn v. Farmers Insurance Co., 233 Or App 401, 226 P3d 86 (2010)

Process of recovering fees for appellate work may be considered part of appeal for purpose of fee petition. Strawn v. Farmers Insurance Co., 233 Or App 401, 226 P3d 86 (2010)

Requirement that attorney fees be imposed if settlement is not made within six months from date of proof of loss is exception to ORCP 54E. Wilson v. Tri-Met, 234 Or App 615, 228 P3d 1225 (2010), Sup Ct review denied

“Policy of insurance” includes enforceable oral binder of insurance. Stuart v. Pittman, 350 Or 410, 255 P3d 482 (2011)

Plaintiff was injured in motor vehicle accident and informed her insurer of her damages, but because plaintiff did not indicate potential uninsured motorist claim against other driver, plaintiff did not provide “proof of loss” sufficient to enable insurer to investigate and estimate uninsured motorist liabilities, and plaintiff was not entitled to attorney fees under subsection (1) of this section. Zimmerman v. Allstate Property and Casualty Ins., 354 Or 271, 311 P3d 497 (2013)

Where plaintiff brought action against defendant for reimbursement of liens plaintiff paid on defendant’s behalf, and defendant paid plaintiff full amount due after action commenced but neither party informed court of payment and court did not enter final judgment for payment, plaintiff did not have “recovery” as used in this section and is not entitled to attorney fees. Triangle Holdings, II v. Stewart Title Guaranty, 266 Or App 531, 337 P3d 1013 (2014)

For purposes of determining scope of permitted issues in claim for uninsured/underinsured motorist benefits, phrase “damages due the insured,” as used in subsection (3) of this section, refers to amount of damages, if any, that insured would be entitled to recover from uninsured motorist, which is different than scope of issues that may be raised under “the amount of benefits due” as used in subsection (2) of this section; thus, dispute about whether plaintiff sustained economic damages as result of collision was within scope of issues of “damages due the insured.” Spearman v. Progressive Classic Insurance Co., 276 Or App 114, 366 P3d 821 (2016), aff’d 361 Or 584, 396 P3d 885 (2017); Koenig v. State Farm Mutual Automobile Ins. Co., 315 Or App 28, 500 P3d 68 (2021), Sup Ct review denied

Insured was not disqualified from attorney fee exemption under this section when insurer referred to issues of fault and damages as only issues for determination for claim but also referenced potential offset for collateral source payments, which was not actual issue in dispute, because latter reference was reference to nonissue for determination of claim. Robinson v. Tri-Met, 277 Or App 60, 370 P3d 864 (2016), Sup Ct review denied

Plaintiff was entitled to award of attorney fees where plaintiff was prevailing party on subsequent appeal for defendant’s counterclaim action for breach of contract because plaintiff’s subsequent action was one “upon [a] policy of insurance” within meaning of this section where source of claim was underlying insurance policy that plaintiff purchased from defendant. Masood v. Safeco Ins. Co., 360 Or 638, 386 P3d 646 (2016)

As used in this section, “recovery” need not be limited to award in form of judgment as precondition to award of attorney fees; therefore, when insured files action against insurer to recover sums owing on insurance policy and insurer subsequently pays insured more than amount of any tender made within six months from insured’s proof of loss, insured obtains a “recovery” that entitles insured to award of reasonable attorney fees. Long v. Farmers, 360 Or 791, 388 P3d 312 (2017)

Insurer’s invitation to insured to request arbitration is not unconditional offer required to establish safe harbor exemption from liability for attorney fees with respect to claims for uninsured or underinsured motorist benefits. Lizama v. Allstate Fire and Casualty Ins. Co., 292 Or App 611, 425 P3d 464 (2018)

Defendant remained within statutory safe harbor even though defendant raised issue of plaintiff’s comparative fault in automobile accident with underinsured motorist, because determination of comparative fault is part of analysis of underinsured motorist’s legal obligations and therefore within scope of safe harbor. Berger v. Safeco Ins. Co., 305 Or App 380, 470 P3d 420 (2020), Sup Ct review denied

Insurer qualifies for safe harbor exemption from liability for attorney fees if only remaining disputed issues are liability of uninsured or underinsured motorist and damages due insured, regardless of whether insurer acts unreasonably or in bad faith in contesting liability or damages or not reaching settlement on those issues earlier. Rice v. State Farm Mutual Automobile Ins. Co., 307 Or App 238, 476 P3d 983 (2020), Sup Ct review denied

Where insurer initially agreed to binding arbitration but later refused to be bound by resulting award, plaintiff may collect attorney fees because insurer’s refusal removed insurer from this section’s safe harbor provision. Burns v. American Family Mutual Ins., 310 Or App 431, 487 P3d 50 (2021)

LAW REVIEW CITATIONS: 44 WLR 253 (2007)

742.206

(formerly 743.609)

NOTES OF DECISIONS

Fire insurance policy terminates at 12:01 a.m. on last date of coverage regardless of whether policy included this provision or whether insured received policy “jacket” containing provision. Cambron v. North-West Ins. Co., 70 Or App 51, 687 P2d 1132 (1984), Sup Ct review denied

742.208

(formerly 743.612)

See also annotations under ORS 743.612 in permanent edition.

NOTES OF DECISIONS

In action for insurance fraud or false swearing brought under this section, standard of proof is preponderance of evidence. Mutual of Enumclaw Ins. v. McBride, 295 Or 398, 667 P2d 494 (1983)

“Reliance” means ordinary reliance requiring evidence of detrimental action or change in position. Eslamizar v. American States Ins. Co., 134 Or App 138, 894 P2d 1195 (1995), Sup Ct review denied

Restriction of fraud and concealment exclusion to actions by “the insured” does not mandate similar restriction of nonconflicting contractual exclusions. Traders and General Insurance Co. v. Freeman, 81 F. Supp. 2d 1070 (D. Or. 2000)

742.216

NOTES OF DECISIONS

House is “unoccupied” if not in actual use by person as usual place of habitation. Schmidt v. Underwriters at Lloyds of London, 191 Or App 340, 82 P3d 649 (2004)

742.222

NOTES OF DECISIONS

Estoppel is not included under term “waiver” in this section. Kabban v. Mackin, 104 Or App 422, 801 P2d 883 (1990)

742.232

(formerly 743.648)

See also annotations under ORS 743.648 in permanent edition.

NOTES OF DECISIONS

Where defendant-insurers demanded appraisal under this section to determine actual cash value of plaintiff’s building which was destroyed by fire, action by plaintiffs, seeking determination of various policy provisions relevant to fixing amount of loss, was premature and this section, together with [former] ORS 743.660, required plaintiffs to proceed with the appraisal before bringing declaratory judgment action. Director v. So. Carolina Ins. Co., 49 Or App 179, 619 P2d 649 (1980), Sup Ct review denied

This section, in requiring that all fire insurance policies sold in state include provision that disputed amounts of loss be submitted to appraisal does not violate Article I, section 17, of Oregon Constitution by depriving plaintiff of right to jury trial when construed as non-binding as to party who does not demand appraisal. Molodyh v. Truck Insurance Exchange, 304 Or 290, 744 P2d 992 (1987)

LAW REVIEW CITATIONS: 31 WLR 737 (1995)

742.240

(formerly 743.660)

See also annotations under ORS 743.660 in permanent edition.

NOTES OF DECISIONS

Commencement of an action within the limitation in this section was governed by ORS 12.220. Hatley v. Truck Ins. Exch., 261 Or 606, 484 P2d 426, 495 P2d 1196 (1972)

Where defendant-insurers demanded appraisal under [former] ORS 743.648 to determine actual cash value of plaintiffs’ building which was destroyed by fire, action by plaintiffs, seeking determination of various policy provision relevant to fixing amount of loss, was premature and this section, together with [former] ORS 743.648, required plaintiffs to proceed with the appraisal before bringing declaratory judgment action. Director v. So. Carolina Ins. Co., 49 Or App 179, 619 P2d 649 (1980), Sup Ct review denied

Since purpose of this section is not to be statutory limitation period but to be limit on ability of insurers to impose shorter limitation period by operation of contract, ORS 12.155 cannot toll the running of this limitation period. Ben Rybke, Co. v. Royal Globe Ins. Co., 293 Or 513, 651 P2d 138 (1982)

Where policy does not comply with this section, courts must construe policy to contain mandatory statutory requirements and applicable limitation period is one-year period under this section. Olson v. National Indemnity Co., 112 Or App 359, 829 P2d 716 (1992)

Statutory language prevents application of discovery rule to determine date of loss. Moore v. Mutual of Enumclaw Insurance Co., 317 Or 235, 855 P2d 626 (1993)

Suit limitation provision is neither statute of limitations nor forfeiture of coverage. Herman v. Valley Insurance Co., 145 Or App 124, 928 P2d 985 (1996), Sup Ct review denied

Insurer is not required to show prejudice in order to assert suit limitation defense. Herman v. Valley Insurance Co., 145 Or App 124, 928 P2d 985 (1996), Sup Ct review denied

742.246

NOTES OF DECISIONS

“Sufficiently explanatory” means title must put reader on notice that provisions appearing under title restrict or abridge right to coverage or other rights of insured under policy. Fleming v. United Services Automobile Association, 329 Or 449, 988 P2d 378 (1999), modified 330 Or 62, 996 P2d 501 (2000)

Explanatory title may be printed in mixed uppercase and lowercase type so long as all letters are at least as large as eight-point capital letters. Indiana Lumbermens Mutual Insurance Co. v. West Oregon Wood Products, Inc., 268 F3d 639 (9th Cir. 2001)

Requirement that provision restricting or abridging rights of insured carry explanatory title applies only to standard fire insurance policies and does not apply to any other insurance policies. Summit Real Estate Management v. Mid-Century Ins. Co., 298 Or App 164, 445 P3d 905 (2019)

742.449 to 742.466

NOTES OF DECISIONS

Where Financial Responsibility Law requires motor vehicle insurance policies to insure against all liability arising out of motor vehicle “ownership, operation, use or maintenance,” insurer’s named driver policy which insurer sold to insured in connection with insured’s vehicle must be construed as providing coverage by law and insurer is responsible for insured’s defense. Viking Ins. Co. v. Perotti, 308 Or 623, 784 P2d 1081 (1989)

742.450

(formerly 486.541, then 743.776)

See also annotations under ORS 486.541 in permanent edition.

NOTES OF DECISIONS

This section, together with ORS 806.070, does not mandate omnibus coverage to limits set forth in ORS 806.070. Shell Oil Co. v. Employers Ins. of Wausau, 69 Or App 179, 684 P2d 622 (1984)

Financial responsibility laws generally are to ensure that drivers can respond in damages for liability and especially to ensure that motor vehicle accident victims are compensated for injuries. State Farm Fire and Casualty Co. v. Jones, 306 Or 415, 759 P2d 271 (1988)

Car insurance policy violated Financial Responsibility Law where it excluded liability coverage for permissive user’s injury of insured while driving insured’s car. State Farm Fire and Casualty Co. v. Jones, 306 Or 415, 759 P2d 271 (1988)

Automobile insurance policy must cover not only named insured but also must provide coverage for all persons who operate insured vehicle with consent of insured. Viking Ins. Co. v. Petersen, 308 Or 616, 784 P2d 437 (1989)

Family exclusion provision of policy is ineffective only as to statutorily required minimum amounts; insurer may limit additional coverage by any exclusion not otherwise prohibited by law. Collins v. Farmers Ins. Co., 312 Or 337, 822 P2d 1146 (1991); Farmers Insurance Co. v. Mowry, 350 Or 686, 261 P3d 1 (2011)

“Statement” excluding person from policy coverage may be embodied as recital in insurance application form. Progressive Insurance v. National American Insurance Co., 201 Or App 301, 118 P3d 836 (2005)

This provision does not prohibit insurance policy from excluding from coverage one employee’s liability to another employee of same employer. Garrett v. New Hampshire Insurance Co., 860 F. Supp. 2d 1203 (D. Or. 2012)

LAW REVIEW CITATIONS: 44 WLR 253 (2007)

742.454

(formerly 486.546, then 743.778)

NOTES OF DECISIONS

Words “need not insure” differentiate between risks statute enumerates and risks that policies required by law do not need to insure; injuries to family members are not among risks that liability policies “need not insure” and therefore policies issued under Financial Responsibility Law must insure such injuries. Dowdy v. Allstate Ins. Co., 68 Or App 709, 685 P2d 444 (1984), Sup Ct review denied

LAW REVIEW CITATIONS: 44 WLR 253 (2007)

742.456

(formerly 486.551, then 743.779)

See also annotations under ORS 486.551 in permanent edition.

NOTES OF DECISIONS

Under this section, insurance carrier’s liability is absolute with respect to policies issued as proof of financial responsibility, and insurer was not entitled to raise defense of insured’s non-cooperation where policy was issued for this purpose. Rowley v. Dairyland Ins. Co., 44 Or App 333, 605 P2d 1356 (1980)

742.460

(formerly 486.561, then 743.782)

See annotations under ORS 486.561 in permanent edition.

742.464

(formerly 486.566, then 743.785)

NOTES OF DECISIONS

Under this section, insurer who failed to file notice of cancellation required by ORS 806.270 was liable only for required statutory coverage and not for excess amount of lapsed policy. Oregon Automobile Ins. Co. v. Thorbeck, 283 Or 271, 583 P2d 543 (1978)

Legislative intent in using word “coverage” in this section is to encompass not only risk insured against but also monetary amount of insurance. Oregon Automobile Ins. Co. v. Thorbeck, 283 Or 271, 583 P2d 543 (1978)

742.468

NOTES OF DECISIONS

Exclusion from definition of motor vehicle liability policies only applies to listed policies initially issued after effective date of statute. Savage v. Grange Mutual Insurance Co., 158 Or App 86, 970 P2d 695 (1999), Sup Ct review denied

Where person is injured in automobile accident, “excess liability policies” kick in only after exhausting limits of primary insurance policies. Oregon Mutual Ins. Co. v. Certain Underwriters at Lloyd’s London, 295 Or App 790, 437 P3d 232 (2019)

742.500 to 742.506

(formerly 743.786 to 743.795)

NOTES OF DECISIONS

These statutes apply to umbrella policies that insure against loss arising from use of automobile. American Economy Ins. Co. v. Canamore, 114 Or App 348, 834 P2d 542 (1992), Sup Ct review denied

LAW REVIEW CITATIONS: 24 WLR 948 (1988)

742.500

(formerly 743.786)

LAW REVIEW CITATIONS: 8 WLJ 83 (1972)

742.502

(formerly 743.789)

See also annotations under ORS 743.789 in permanent edition.

NOTES OF DECISIONS

Insurer’s notification of availability of increased uninsured motorist coverage satisfied requirement of “offer” under this section. Beck v. Powell, 113 Or App 318, 832 P2d 1254 (1992), Sup Ct review denied

Underinsured motorist limits can be calculated without conflict with ORS 742.542. Yokum v. Farmers Ins. Co., 117 Or App 546, 844 P2d 937 (1993), Sup Ct review denied

Underinsured motorist coverage applies only where dollar amount of tortfeasor’s policy is exceeded, notwithstanding that recovery limitations imposed by law may prevent full recovery of damages. Dasteur v. American Economy Ins. Co., 127 Or App 686, 874 P2d 85 (1994), Sup Ct review denied

Whether car is underinsured is determined by comparing per accident policy limitations, not per person policy limitations. Windsor Ins. Co. v. Judd, 321 Or 379, 898 P2d 761 (1995)

Where policy was initially issued prior to effective date of 1993 amendments to this section, appropriate remedy for insurer’s failure to make required offering of uninsured motorist coverage is to read into insurance contract coverage insurer should have offered. Savage v. Grange Mutual Insurance Co., 158 Or App 86, 970 P2d 695 (1999), Sup Ct review denied

Failure of insurer to offer increased uninsured motorist insurance at time of policy issuance dictates imputing increased coverage, notwithstanding policyholder election at subsequent time to decline increased coverage. Buccino v. California Casualty Insurance Co., 159 Or App 654, 978 P2d 441 (1999), Sup Ct review denied

For single-limit policy, amount recoverable by insured as underinsured or uninsured motorist benefit is subject to offset only by those amounts paid by other sources on account of injury to that individual insured. Grijalva v. Safeco Insurance Co., 329 Or 36, 985 P2d 784 (1999)

Statutory exclusion of insured vehicles from definition of uninsured vehicle in ORS 742.504 is applicable to underinsured motorist coverage. Wright v. State Farm Mutual Automobile Insurance Co., 332 Or 1, 22 P3d 744 (2001)

Where multiple claimants obtain recovery under liability policy, provisions of this section allowing recovery equal to amount by which underinsured motorist insurance exceeds claimant’s recovery supersede requirement of this section that damages or death arise from vehicle insured for less than amount of underinsured motorist coverage. Takano v. Farmers Insurance Co., 184 Or App 479, 56 P3d 491 (2002), Sup Ct review denied

Under 2001 version of statute, whether tortfeasor was underinsured was determined by comparing insurance policy limit of tortfeasor with policy limit of insured. Mid-Century Insurance Co. v. Perkins, 209 Or App 613, 149 P3d 265 (2006), aff’d 344 Or 196, 179 P3d 633 (2008), modified 345 Or 373, 195 P3d 59 (2008)

Under 2001 version of this section, phrase “Uninsured motorist coverage benefits” means uninsured motorist liability limits in policy of insured, not total amount of damages incurred. Vogelin v. American Family Mutual Insurance Co., 346 Or 490, 213 P3d 1216 (2009)

Provision that subjects underinsurance coverage to model policy terms requires model policy terms to apply equally to uninsured motorist and underinsured motorist coverage unless application of terms is inconsistent with mandate to provide underinsured motorist coverage. Vogelin v. American Family Mutual Insurance Co., 346 Or 490, 213 P3d 1216 (2009)

Insurer may offset tortfeasor liability payment against policy limit for uninsured motorist liability. Vogelin v. American Family Mutual Insurance Co., 346 Or 490, 213 P3d 1216 (2009)

LAW REVIEW CITATIONS: 34 WLR 327 (1998); 44 WLR 253 (2007)

742.504

(formerly 743.792)

See also annotations under ORS 743.792 in permanent edition.

NOTES OF DECISIONS

In general

A tortfeasor whose insurance policy is disclaimed subsequent to an accident for failure to notify his insurer of the accident is an uninsured motorist under this section. General Acc. Fire and Life Assur. Corp., Ltd. v. Shasky, 266 Or 312, 512 P2d 987 (1973)

A tortfeasor is not uninsured because his liability insurance is insufficient in amount to compensate for all injuries. Lund v. Mission Ins. Co., 270 Or 461, 528 P2d 78 (1974)

An endorsement excluding coverage while the insured automobile was operated by a person under 25 years of age did not preclude the passenger injured by the negligence of the uninsured motorist from recovering under the uninsured motorist provisions of the policy even though the driver of the insured vehicle was under the age of 25. Hartford Acc. and Indem. Co. v. Dairyland Ins. Co., 274 Or 145, 545 P2d 113 (1976)

In the absence of a specific agreement, this section does not apply to establish a two-year statute of limitations; if the policy is silent, the normal six-year statute of limitations for contract actions applies. North River Ins. v. Kowaleski, 275 Or 531, 551 P2d 1286 (1976); Kalhar v. Transamerica Ins. Co., 129 Or App 38, 877 P2d 656 (1994), Sup Ct review denied

Where insured brought action against insurance company alleging that insurer, in bad faith, prejudiced his claim for uninsured motorist coverage, this section and insurance contract provided that arbitration was condition precedent to litigation. Mendelson v. State Farm Mutual Auto Ins. Co., 285 Or 269, 590 P2d 726 (1979)

This section authorizes insurer to exclude from uninsured motorist coverage an insured who occupies a vehicle as to which insured has procured liability insurance satisfying financial responsibility law. State Farm Mut. Ins. Co. v. Whitlock, 59 Or App 303, 650 P2d 1042 (1982), Sup Ct review denied

Vehicle fitting any categories of this section is “the insured motor vehicle” for purposes of PIP. Utah Home Fire Ins. Co. v. Colonial Ins. Co., 300 Or 564, 715 P2d 1112 (1986)

Requirement that named insured be person designated in schedule does not mean that principal shareholder of insured corporation is covered by policy that only names corporation. Meyer v. American Economy Ins. Co., 103 Or App 160, 796 P2d 1223 (1990), Sup Ct review denied

Plaintiff’s injuries were not covered when plaintiff was run over by uninsured thief stealing plaintiff’s insured vehicle. Cole v. Farmer Ins. Co., 108 Or App 277, 814 P2d 188 (1991)

Benefits were not payable under uninsured motorist policy until policy limits of other tortfeasors had been exhausted. Stembridge v. West American Ins. Co., 109 Or App 552, 823 P2d 418 (1991); Estate of Salma S. Serang v. Amer. States Ins. Co., 127 Or App 405, 873 P2d 367 (1994)

“Insured vehicle” does not include nonowned vehicle driven by named insured, if one of the passengers owns vehicle. Farmers Ins. Co. v. Paepier, 110 Or App 77, 822 P2d 140 (1991), Sup Ct review denied

Nothing in language “furnished for regular use” requires that vehicle must be totally under insured’s control and available for both personal and business use. North Pacific Ins. Co. v. Anderson, 110 Or App 269, 821 P2d 444 (1991)

Arbitration proceedings described in this section do not violate right to jury trial because claimant or insurer is not required to arbitrate claim and can demand jury trial. Carrier v. Hicks, 316 Or 341, 851 P2d 581 (1993)

Insured satisfies entitlement to recovery by establishing that other motorist was uninsured and is legally liable for damages to insured and amount of damages. Kalhar v. Transamerica Ins. Co., 129 Or App 38, 877 P2d 656 (1994), Sup Ct review denied

“Occupying” is limited to processes that directly cause, continue or terminate physical relationship between person and car. Marcilionis v. Farmers Ins. Co., 318 Or 640, 871 P2d 470 (1994)

Provision making damage determination through mandatory arbitration binding on party not requesting arbitration violated constitutional right to jury. Lind v. Allstate Insurance Co., 134 Or App 395, 895 P2d 327 (1995), modified 136 Or App 532, 902 P2d 603 (1995), Sup Ct review denied

Validity of policy provision is based on comparison between coverage under policy and coverage under hypothetical policy consisting totally of statutory model provisions. Vega v. Farmers Ins. Co., 323 Or 291, 918 P2d 95 (1996)

Only permissible variation from model statutory provisions is to exclude or soften provisions favorable to insurer or to add extraneous terms that are neutral or favorable to insured. Vega v. Farmers Ins. Co., 323 Or 291, 918 P2d 95 (1996)

Total underinsured motorist coverage benefits are calculated by deducting amount recovered from other automobile liability policies from base amount of uninsured motorist coverage. Pitchford v. State Farm Mutual Auto. Ins. Co., 147 Or App 9, 934 P2d 616 (1997), Sup Ct review denied

Filing action that is subject to court-mandated arbitration is not election to settle matter by arbitration. Douglass v. Allstate Ins. Co., 152 Or App 216, 953 P2d 770 (1998), Sup Ct review denied

Because recovery of damages against government is limited by [former] ORS 30.270, injured party is not “legally entitled to recover” excess damages through uninsured motorist insurance claim. Surface v. American Spirit Insurance Cos., 154 Or App 696, 962 P2d 717 (1998), aff’d 335 Or 356, 67 P3d 938 (2003)

Offset of paid-out workers’ compensation benefits against amount due from underinsured motorist insurance applies regardless of whether workers’ compensation beneficiaries and insurance beneficiaries are identical. Estate of Linda Greenslitt v. Farmers Insurance Co., 156 Or App 75, 964 P2d 1129 (1998)

Where action is victim’s claim against insurer under policy issued to victim, whether injury was intentional is viewed from perspective of victim, not person inflicting harm. Fox v. Country Mutual Insurance Co., 327 Or 500, 964 P2d 997 (1998)

Injury is “caused by accident” if injury itself was not intentionally inflicted, even though caused by intentional act. Fox v. Country Mutual Insurance Co., 327 Or 500, 964 P2d 997 (1998)

Defendant’s successful assertion of contributory negligence defense does not make plaintiff insured “person or organization alleged to be legally responsible for bodily injury.” Safeco Insurance Co. v. Laskey, 162 Or App 1, 985 P2d 878 (1999)

Insured’s acceptance of settlement offer from tortfeasor’s liability insurer precludes recovering uninsured motorist benefits based on liability insurer’s earlier denial of coverage. Fox v. Country Mutual Insurance Co., 169 Or App 54, 7 P3d 677 (2000), Sup Ct review denied

Requirement that suit against uninsured motorist be “filed” within specified time does not incorporate requirement for service of process. Lindsey v. Farmers Insurance Co., 170 Or App 458, 12 P3d 571 (2000)

“This coverage” refers to underinsured motorist coverage provided by individual policy, not aggregate coverage under multiple policies issued by same insurer. VanWormer v. Farmers Insurance Co., 171 Or App 450, 15 P3d 612 (2000)

Relevant factors for determining whether person using uninsured vehicle is member of household of insured are: 1) whether parties live under one roof; 2) length of time parties have lived together; 3) whether residence is intended to be permanent or temporary; and 4) whether parties are financially independent. State Farm Mutual Automobile Insurance Co. v. McCormick, 171 Or App 657, 17 P3d 1083 (2000), Sup Ct review denied

“Amount paid” under workers’ compensation law means net amount that insured received after any recoupment by workers’ compensation insurer. Harlow v. Allstate Insurance Co., 177 Or App 122, 33 P3d 363 (2001)

For purposes of deducting payments from other sources, amount payable under terms of “this coverage” is amount insured would be legally entitled to recover from owner or operator of uninsured or underinsured vehicle on account of bodily injury, not policy limit on insurer liability. Bergmann v. Hutton, 337 Or 596, 101 P3d 353 (2004)

Person is “severally liable together with” underinsured motorist if person is independently liable to insured for same injuries caused by underinsured motorist. Kerry v. Quicehuatl, 213 Or App 589, 162 P3d 1033 (2007), Sup Ct review denied

Where policy fails to clearly notify insured of requirement imposed on insured by statute, policy language is less favorable to insured than statutory language. Wilson v. Tri-County Metropolitan Transportation District of Oregon, 343 Or 1, 161 P3d 933 (2007)

Under 2001 version of statute, “operator” of uninsured vehicle means person who exercises actual physical control over vehicle. Rogozhnikov v. Essex Insurance Co., 222 Or App 565, 195 P3d 400 (2008)

Period during which insured is disabled does not toll time limitation for accrual of cause of action. Wright v. State Farm Mutual Automobile Ins. Co., 223 Or App 357, 196 P3d 1000 (2008)

Where matter concerns employer and worker, and where neither party has requested order from Workers’ Compensation Board, trial court has subject matter jurisdiction over issue of reimbursement of underinsured motorist benefits. Longstreet v. Liberty Northwest Insurance Corporation, 238 Or App 396, 245 P3d 656 (2010)

Insurance contract that contains mutual agreement to arbitrate dispute is not required to institute formal arbitration proceedings. Bonds v. Farmers Insurance Co., 349 Or 152, 240 P3d 1086 (2010)

To formally institute arbitration proceedings, insured or insurer must expressly communicate to other party that initiating party is beginning process of arbitrating dispute. Bonds v. Farmers Insurance Co., 349 Or 152, 240 P3d 1086 (2010)

Party does not formally institute arbitration proceedings when party has consented to arbitrate upon occurrence of certain event and, upon occurrence of that event, does not expressly advise or acknowledge to other party that event has occurred. Bonds v. Farmers Insurance Co., 349 Or 152, 240 P3d 1086 (2010). But see Paton v. American Family Mutual Insurance Co., 256 Or App 607, 302 P3d 1204 (2013), Sup Ct review denied

Express consent to arbitration suffices to formally institute arbitration proceedings. Paton v. American Family Mutual Insurance Co., 256 Or App 607, 302 P3d 1204 (2013), Sup Ct review denied

Where plaintiff, while driving, was victim of drive-by shooting and as insured under auto policy, victim sought uninsured motorist benefits under this section against defendant, granting of summary judgment on basis that plaintiff’s injury did not “arise of the use of [an] uninsured vehicle” under this section, was improper. De Zafra v. Farmers Ins. Co., 270 Or App 77, 346 P3d 652 (2015)

Where insured was passenger in vehicle involved in two accidents, and underlying liability of negligent drivers and amount each driver could be required to pay were no longer at issue, determination of underinsured motorist policy limits depended on whether insured’s injuries were caused by one or both accidents. Wright v. Turner, 368 Or 207, 489 P3d 102 (2021)

Where insured is covered under multiple policies containing uninsured/underinsured motorist coverage issued by insurer, policy term limiting insurer’s liability to amount specified in policy providing highest limit of liability that results in coverage less favorable to insured than coverage under statutory comprehensive model policy term is unenforceable. Batten v. State Farm Mutual Automobile Ins. Co., 368 Or 538, 495 P3d 1222 (2021)

Phantom vehicle

Corroboration, as used in phantom vehicle provision, means evidence that supplements, strengthens and confirms testimony of injured claimant; it does not mean that claimant’s prima faciecase rests solely on corroborating evidence. Farmers Ins. Exch. v. Colton, 264 Or 210, 504 P2d 1041 (1972)

Where insured acted with reasonable diligence and under circumstances of case, he was excused from strict compliance with notice requirements of this section. Farmers Ins. Exch. v. Colton, 264 Or 210, 504 P2d 1041 (1972)

The requirement of corroborative “facts of an accident” means observation, with corroborated testimony thereof, of facts from which inferences may be drawn that accident was caused by phantom vehicle. Farmers Ins. Exch. v. Colton, 264 Or 210, 504 P2d 1041 (1972)

Even though individual’s policy does not contain phantom vehicle coverage, this section requires that policy be construed as though it contained phantom vehicle coverage required by statute. Farmers Ins. Exch. v. Colton, 264 Or 210, 504 P2d 1041 (1972)

Testimony of witness who released right to claim against insurer prior to testifying was not legally insufficient as corroborative evidence. To v. State Farm Mutual Ins., 319 Or 93, 873 P2d 1072 (1994)

LAW REVIEW CITATIONS: 54 OLR 328 (1975); 31 WLR 737 (1995); 34 WLR 327 (1998); 44 WLR 253 (2007)

742.520 to 742.542

(formerly 743.800 to 743.835)

NOTES OF DECISIONS

Nothing in PIP statutes prohibits plaintiff from pleading and proving all special damages in a civil action, even though plaintiff has received PIP benefits from his insurer. Koberstein v. Sierra Glass, 65 Or App 409, 671 P2d 1190 (1983), as modified by 66 Or App 883, 675 P2d 1126 (1984), Sup Ct review denied

PIP endorsement which offsets PIP payments against policy’s liability limits does not contravene PIP scheme of these statutes. Edwards v. Bonneville Automobile Insurance Co., 68 Or App 863, 683 P2d 142 (1984), aff’d 299 Or 119, 699 P2d 670 (1985)

742.520

(formerly 743.800)

NOTES OF DECISIONS

Insurance policy clause required by this section, providing for payment of 70 percent of injured person’s lost wages during period of disability, was inapplicable where injured person was killed instantaneously, because there was no period of “disability” within meaning of policy. Perez v. State Farm Mutual Auto Ins. Co., 43 Or App 19, 602 P2d 284 (1979), aff’d 289 Or 295, 613 P2d 23 (1980)

Where liability policy issued to plaintiff’s father covered private passenger vehicle registered to father, fact that plaintiff was injured riding motorcycle did not disqualify him from PIP coverage. Garrow v. Pennsylvania Gen. Ins. Co., 40 Or App 23, 594 P2d 415 (1979), aff’d 288 Or 215, 603 P2d 1175 (1979)

Where, at time of accident, insured father’s married son and his wife and child were living in father’s house and paying $100 per month room and board, son was member of father’s family, residing in father’s household as required for coverage under this section. Garrow v. Pennsylvania Gen. Ins. Co., 40 Or App 23, 594 P2d 415 (1979), aff’d 288 Or 215, 603 P2d 1175 (1979)

Language of this section and [former] ORS 743.805 indicates that legislature was aware of family exclusion provision and chose to regulate it only to limited extent. State Farm v. Baughman, 57 Or App 576, 646 P2d 102 (1982)

Under definitions of “pedestrian” and “occupying” of this section, defendant who was ejected from car, rendered immobile and struck by plaintiff’s insured, was “pedestrian.” State Farm Ins. v. Berg, 70 Or App 410, 689 P2d 959 (1984), Sup Ct review denied

Where passenger was occupying motor vehicle insured as temporary substitute vehicle in driver’s policy, personal injury protection benefits afforded to passenger under driver’s liability policy while passenger was riding in her own vehicle were primary insurance, while personal injury protection benefits afforded to passenger under her own broad form named operator policy were excess insurance. Utah Home Fire Ins. Co. v. Colonial Ins. Co., 300 Or 564, 715 P2d 1112 (1986)

ORS 12.155, which requires person making advance payment before determining tort liability to give written notice of when applicable statute of limitations will run, is not applicable to Personal Injury Protection payments made under this section. Smith v. Riker, 88 Or App 579, 746 P2d 247 (1987), Sup Ct review denied

Breach of good faith duty to pre-authorize treatment is denial of benefits subject to mandatory arbitration provision. Eggiman v. Mid-Century Insurance Co., 134 Or App 381, 895 P2d 333 (1995)

Injury results from use of motor vehicle if injury is direct or indirect consequence or effect of motor vehicle use. Carrigan v. State Farm Mutual Automobile Ins. Co., 326 Or 97, 949 P2d 705 (1997)

Any person permitted by insured to use insured’s motor vehicle is entitled to personal injury protection benefits unless person is specifically excluded from such protection by law. Sheptow v. Geico General Insurance Co., 246 Or App 18, 265 P3d 4 (2011), Sup Ct review denied

ATTY. GEN. OPINIONS: Use of PIP benefits for uninsured pedestrian eligible for medical assistance and covered under Motor Vehicle Accident Fund, (1982) Vol. 43, p 1

LAW REVIEW CITATIONS: 31 WLR 737 (1995)

742.522

NOTES OF DECISIONS

Nonrecovery of attorney fees and costs does not apply to fees and costs incurred in litigating previously arbitrated personal injury protection claim. Kramm v. Mid-Century Ins. Co., 153 Or App 325, 956 P2d 1036 (1998)

Application of pre-1997 version of ORS 742.520 so as to make arbitration binding on nondemanding party denied constitutional right to jury in civil cases. Foltz v. State Farm Mutual Auto. Ins. Co., 326 Or 294, 952 P2d 1012 (1998)

LAW REVIEW CITATIONS: 31 WLR 737 (1995)

742.524

(formerly 743.805)

NOTES OF DECISIONS

Language of this section and [former] ORS 743.800 indicates that legislature was aware of family exclusion provision and chose to regulate it only to limited extent. State Farm v. Baughman, 57 Or App 576, 646 P2d 1022 (1982)

Where plaintiff, insured by defendant insurer, was injured in automobile accident and incurred expenses for transportation to medical appointments necessary to treat injuries, defendant insurer is not required to cover those transportation expenses. Dowell v. Oregon Mutual Insurance Co., 268 Or App 672, 343 P3d 283 (2015), aff’d 361 Or 62, 388 P3d 1050 (2017)

Presumption that medical expenses in personal injury protection claims are “reasonable and necessary” under this section is not conclusive and may be rebutted. McBride v. State Farm Mutual Automobile Ins. Co., 282 Or App 675, 386 P3d 679 (2016), Sup Ct review denied

Where defendant insurer failed to send timely denial of personal injury protection claims as required by this section and ORS 742.528 because of insured’s repeated failure to attend required medical examination within 60-day post-claim period to determine whether medical expenses were “reasonable and necessary,” insurer had contractual right to compel medical examination and obligation to investigate insured’s personal injury protection claims, but still had obligation under this section and ORS 742.528 to issue timely denial based on information insurer had or could reasonably obtain or expenses were presumed reasonable and necessary. McBride v. State Farm Mutual Automobile Ins. Co., 282 Or App 675, 386 P3d 679 (2016), Sup Ct review denied

Fifty-two-week limit on payment of personal injury protection benefits under automobile insurance policy applies on per-policy basis, and injured passenger receiving 52 weeks of benefits under vehicle owner’s policy may receive up to 52 weeks of additional coverage under passenger’s own policy. Padilla v. State Farm Mutual Automobile Ins. Co., 314 Or App 300, 499 P3d 100 (2021), Sup Ct review denied

742.526

(formerly 743.810)

NOTES OF DECISIONS

Personal injury protection benefits may be offset by benefits collected from another source if the insurance policy so provides. Southwestern Ins. Co. v. Winn, 274 Or 695, 548 P2d 1311 (1976)

Where insurer made personal injury protection payments to insureds who subsequently received workers compensation awards for same injury, former statute did not authorize imposition of equitable trust to recover these payments. Farmers Ins. Co. v. Ownby, 40 Or App 15, 594 P2d 834 (1979)

When damages incurred by insured are greater than personal injury benefits designated by this section as “primary,” insurer is liable for “excess” damages to the limits of its coverage and protection benefits are triggered for payment that excess insurance coverage must be greater than primary insurance coverage. Porter v. Utah Home Fire Ins. Co., 58 Or App 729, 650 P2d 130 (1982)

Policy which covers vehicle involved in collision or accident is primary as against policy not covering vehicle. Utah Home Fire Ins. Co. v. Colonial Ins., 300 Or 564, 715 P2d 1112 (1986)

Where plaintiff presently has no entitlement to underinsured motorist benefits under her own insurance contract, personal injury protection insurance benefits under defendant’s insured’s contract are not excess over underinsured motor coverage. Farley v. Farmers Insurance Co. of Oregon, 83 Or App 99, 730 P2d 598 (1986)

Medical assistance payments made by the state under ORS chapter 414 are “governmental benefits” within the meaning of this section and thus personal injury protection benefits are limited to expenses that exceed any medical assistance payments. Farmers Insurance Co. of Oregon v. Wickham, 86 Or App 100, 739 P2d 30 (1987)

742.528

NOTES OF DECISIONS

Where defendant insurer failed to send timely denial of personal injury protection claims as required by this section and ORS 742.524 because of insured’s repeated failure to attend required medical examination within 60-day post-claim period to determine whether medical expenses were “reasonable and necessary,” insurer had contractual right to compel medical examination and obligation to investigate insured’s personal injury protection claims, but still had obligation under this section and ORS 742.524 to issue timely denial based on information insurer had or could reasonably obtain or expenses were presumed reasonable and necessary. McBride v. State Farm Mutual Automobile Ins. Co., 282 Or App 675, 386 P3d 679 (2016), Sup Ct review denied

742.534

(formerly 743.825)

NOTES OF DECISIONS

An insurer who makes recovery from third party for moneys paid its insured is only required to pay attorney fees which were “reasonably and necessarily incurred” to make recovery; and, absent an agreement to contrary, an insurer is only obligated for attorney fees if it is benefited. Ridenour v. Nationwide Mut. Ins. Co., 273 Or 514, 541 P2d 1377 (1975)

No reimbursement could be compelled against insurer of party allegedly at fault by insurer who made personal injury payments if action by plaintiff-insured was barred by statute of limitations. West American Ins. Co. v. Nationwide Mutual Ins. Co., 39 Or App 525, 593 P2d 796 (1979), Sup Ct review denied

Reference to furnishing of benefits by “another insurer” and “other insurer” does not preclude insurer who by chance insures both vehicles from offset provided by [former] ORS 18.510. State Farm Mut. Auto Ins. v. Sommerholder, 65 Or App 449, 671 P2d 1194 (1983), Sup Ct review denied

“Authorized” motor vehicle liability insurer which is required to reimburse another such insurer for amount paid by it to insured for PIP benefits is not entitled to credit in that amount in determining whether reimbursing insurer has exhausted liability policy limits in settling claim against its insured by payee of the PIP benefits where payee’s damages are in excess of liability policy limits. Kessler v. Weigandt, 299 Or 38, 699 P2d 183 (1985)

Formal acknowledgment of obligation under this section to reimburse constitutes “reimbursement payment” within meaning of [former] ORS 18.510 (PIP reimbursement payments). Dougherty v. Gelco Express Corp., 79 Or App 490, 719 P2d 906 (1986)

When insurer paid passenger injured in motor vehicle accident amount equal to liability limits of insured’s policy, this section prevented further exposure to other insurer. Farmers Ins. Co. v. American Fire & Casualty, 117 Or App 347, 844 P2d 235 (1992), Sup Ct review denied

Statement that insurer would proceed pursuant to PIP reimbursement procedure was not “reimbursement payment” within meaning of [former] ORS 18.510 because insurer did not commit to specific payment amount. Heintz v. Baxter, 120 Or App 603, 853 P2d 320 (1993), Sup Ct review denied

Interinsurer reimbursement is not available for underinsured motorist coverage paid to injured insured. Providence Health Plan v. Charriere, 666 F. Supp. 2d 1169 (D. Or. 2009)

Section requires arbitration of any potential dispute pertaining to interinsurer reimbursement. California Casualty Indemnity v. Federated Mutual, 251 Or App 371, 286 P3d 901 (2012), Sup Ct review denied

742.538

(formerly 743.830)

NOTES OF DECISIONS

Former similar statute did not authorize imposition of trust by insurer against workers compensation carrier who made payments to insured or against insurers who received payments as neither were “motorists legally responsible.” Farmers Insurance Co. v. Ownby, 40 Or App 15, 594 P2d 834 (1979)

Provision allowing insurer to require that insured bring action to recover amount of insurance benefits paid does not permit insured to bring second action on claim against tortfeasor. Wynia v. Fick, 162 Or App 365, 986 P2d 625 (1999), Sup Ct review denied

Use of process under ORS 742.534 does not bar claim filed pursuant to this section for moneys that cannot be claimed under ORS 742.534. Providence Health Plan v. Charriere, 666 F. Supp. 2d 1169 (D. Or. 2009)

Where company contracted with Oregon Public Employees Benefits Board to serve as third-party administrator for self-insured health plan and agreed that it was health care service contractor and would comply with statutes governing health care service contractors, company was deemed insurer, was required to follow statutory reimbursement requirements, and company’s failure to comply barred its breach of contract claim asserting subrogation rights against plan member. Providence Health Plan v. Allen, 299 Or App 128, 449 P3d 504 (2019), Sup Ct review denied

LAW REVIEW CITATIONS: 27 WLR 562 (1991)

742.542

(formerly 743.835)

NOTES OF DECISIONS

Insurer is allowed to subtract personal injury protection benefits paid to its insured from the amount due under the uninsured motorist coverage whether or not the insured is fully compensated for his or her loss. Monaco v. U.S. Fid. and Guar. Co., 275 Or 183, 550 P2d 422 (1976)

Judgment for general damages does not have to be reduced by amount of Personal Injury Protection payments made by defendants to plaintiff’s insurer. McIntire v. Gray, 39 Or App 861, 593 P2d 1273 (1979), Sup Ct review denied

Statute is clear and unambiguous and allows only offset of PIP benefits against uninsured motorist coverage insured receives from own insurer. Staiger v. Burkhart, 68 Or App 548, aff’d 299 Or 49, 698 P2d 487 (1985)

Plaintiff’s uninsured motorist coverage limits cannot be reduced by amount of personal injury protection benefits paid by insured’s insurer. Yokum v. Farmers Ins. Co., 117 Or App 546, 844 P2d 937 (1993), Sup Ct review denied

Underinsured motorist limits can be calculated under ORS 742.502 without conflict with this section. Yokum v. Farmers Ins. Co., 117 Or App 546, 844 P2d 937 (1993), Sup Ct review denied

Limitation on insurer reimbursement entitles insured to policy benefits for personal injury protection and uninsured/underinsured motorist coverage up to level of damages. Farmers Insurance Co. v. Conner, 219 Or App 337, 182 P3d 878 (2008), Sup Ct review denied

“Underinsured motorist coverage policy limits” refers to total amount insured is entitled to recover under policy’s underinsured motorist coverage, not to amount of benefits owed under policy. Farmers Insurance Co. v. Conner, 219 Or App 337, 182 P3d 878 (2008), Sup Ct review denied

ATTY. GEN. OPINIONS: Repayment of War Veterans Fund moneys transferred to General Fund, (1988) Vol 46, p 78, clarified (1989) Vol 46, p 245

LAW REVIEW CITATIONS: 34 WLR 327 (1998); 44 WLR 253 (2007)

742.544

NOTES OF DECISIONS

Offset is available only if cause of injury or damage occurred on or after November 1, 1993, regardless of when full measure of damages became known. Horlacher v. Mid-Century Insurance, 143 Or App 564, 923 P2d 1317 (1996)

This section limits amount of reimbursement available to insurer under other statutes, but does not confer independent entitlement to reimbursement. Gaucin v. Farmers Insurance Co., 209 Or App 99, 146 P3d 370 (2006)

Where insurer has paid uninsured/underinsured motorist benefits, personal injury protection payment reimbursement from insured is subject to limitations imposed by ORS 742.542. Farmers Insurance Co. v. Conner, 219 Or App 337, 182 P3d 878 (2008), Sup Ct review denied

LAW REVIEW CITATIONS: 44 WLR 253 (2007)

742.564

NOTES OF DECISIONS

Where insured agreed to termination, policy that insured receive notice of cancellation of coverage sufficient to entitle insured to procure other insurance was inapplicable. Nelson v. Oregon Insurance Guaranty Assn., 102 Or App 125, 794 P2d 1 (1990), Sup Ct review denied