Oregon writes its standard life policy provisions into ORS 743.150 to 743.225, its Standard Nonforfeiture Law into ORS 743.204-743.207, and its replacement and disclosure rules into OAR chapter 836, divisions 51 and 80. The state questions ask for Oregon's numbers and a few rules unique to Oregon:

• A ban on excluding deaths caused by terrorism.
• A 3-year minimum period to sue.
• A 30-day replacement right to return.
• Buyer's Guide timing tied to whether the policy has a 10-day refund provision.

What each provision means in general is in the national Life Policy Provisions, Options and Riders guide.

Required provisions

Grace period (ORS 743.165)

• 30 days, or at the insurer's option one month of not less than 30 days.
• Interest on a premium paid during grace can't exceed 6% a year for the days used.
• If the insured dies during grace, the claim is paid minus the overdue premium with interest.

Incontestability (ORS 743.168, 743.171)

• A policy is incontestable after 2 years in force during the insured's lifetime, except for nonpayment.
• The insurer may exempt disability and additional accidental death benefits from this limit.
• A reinstated policy is contestable for fraud or misrepresentation material to the reinstatement only for the same period as after original issue.

Entire contract and misstatement of age (ORS 743.174, 743.180)

• The policy plus the attached application is the entire contract.
• Misstated age adjusts benefits to what the premium would buy at the true age.

Dividends (ORS 743.183)

• A participating policy shares in divisible surplus annually starting no later than the end of the third policy year.
• The owner may always take dividends in cash.
• The policy names the option that applies if the owner doesn't elect one before the grace period ends.

Policy loans (ORS 743.186-743.187)

• A loan must be available once there is a cash value and premiums have been paid for at least 3 full years.
• Deferral: the insurer may defer a loan, other than one to pay premiums, for up to 6 months.
• Termination for excess loans: only after mailing 30 days' notice to the owner and any assignee.
• Interest: a fixed maximum loan rate can't exceed 8% a year.
• An automatic premium loan uses cash value to pay an overdue premium.

Reinstatement (ORS 743.189)

• Within 3 years after default, unless the policy was surrendered for cash.
• Requires evidence of insurability and payment of arrears with interest.

Assignment (ORS 743.043)

• After an assignment, the insurer may deal with the assignee until it receives written notice at its home office that the assignment has ended.

Prohibited provisions (ORS 743.225)

An Oregon life policy may not:

• Limit the time to sue to less than 3 years after the cause of action accrues.
• Be backdated more than 6 months before the application.
• Exclude death caused by another person's act of terrorism.
• Forfeit the policy for a loan that is below the loan value.

Nonforfeiture (ORS 743.204-743.207)

• An owner in default may choose a paid-up benefit or cash surrender within 60 days after the premium due date.
• The insurer may defer paying cash value for up to 6 months after surrender.
• The law doesn't apply to group insurance, annuities, reinsurance, pure endowments or certain term policies.
• The options are cash surrender, reduced paid-up insurance and extended term insurance, as described in the national guide.

Accelerated death benefits (ORS 743.154)

• One qualifying event is a condition that limits life span to no more than 24 months, as the rider specifies.
• The policy continues for the death benefit that wasn't accelerated.
• An accelerated benefit rider can't be described or marketed as long term care insurance.

Free look and disclosure

No general free look

• Oregon has no general free-look statute for life insurance.

Buyer's Guide and Policy Summary (OAR 836-051-0015)

• If the policy has an unconditional refund provision of at least 10 days, they may be delivered with or before the policy.
• If it doesn't, they must be given before the insurer accepts the initial premium.

Presentations (OAR 836-051-0020)

• Tell the prospect you are acting as a life insurance producer, and give the insurer's full name.
• Say that dividends are not guaranteed.
• Don't compare policy costs without interest adjustments.

Illustrations (OAR 836-051-0500 and following)

• Don't use the term "vanishing premium."
• A policy issued other than as applied for needs a revised illustration signed by the owner and the producer.
• If no illustration was used for a form marketed with one, the producer certifies that none was used.

Suitability (OAR 836-080-0090)

• A purchase or replacement recommendation must be not unsuitable, based on reasonable inquiry into the consumer's objectives, finances and needs.

Replacement (OAR 836-080-0001 to 0043)

What counts as a replacement

• A new purchase where the existing policy is lapsed, surrendered, converted to reduced paid-up or extended term, reduced, or used in a financed purchase.
• Using an existing policy's values within 4 months before or 13 months after the new policy takes effect is prima facie evidence of a financed purchase.
• Replacing non-convertible term that expires within 5 years and can't be renewed is exempt.

The producer's duties

• Present and read the Notice Regarding Replacement no later than when the application is taken.
• Advising an applicant to answer "no" to a replacement question is a violation and an unfair trade practice.

The replacing insurer's duties

• Notify each existing insurer within 5 business days.
• Give a 30-day unconditional right to return.
• If the insurers are the same or affiliated, credit the time already served under the old policy's incontestability and suicide periods.

Commissions

• The Director may limit commission on a replacing policy (ORS 746.085).

Related Oregon rules

Consent and insurable interest (ORS 743.038-743.044)

• The insured must apply for or consent to a policy in writing. One exception is a spouse insuring the other spouse.
• Insurable interest doesn't apply to annuities.
• A person with no insurable interest may buy a policy if a charitable, educational or religious institution is irrevocably named beneficiary.

Life settlements (ORS 744.323-744.367)

• Generally barred within 5 years of issue, with exceptions such as terminal illness.
• The owner may rescind before the earlier of 60 days after signing or 30 days after proceeds are paid.
• A life producer licensed at least 1 year may act as a settlement broker without a separate license.

Guaranty limits

• The Oregon Life and Health Insurance Guaranty Association covers $300,000 in death benefits and $100,000 in cash surrender values per life (ORS 734.810).

Common exam traps

• No general life free look in Oregon. The 30-day right to return applies to replacements. The 10-day rule concerns Buyer's Guide timing.
• Grace period: 30 days, with interest up to 6%.
• Prohibited: terrorism exclusions, backdating over 6 months, and limiting suits to less than 3 years.
• Reinstatement: 3 years. Policy loans after 3 years of premiums.
• Accelerated benefits can't be marketed as LTC insurance.