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ORDER NO. 03-064

DEPARTMENT OF CONSUMER AND BUSINESS SERVICES

WORKERS’ COMPENSATION DIVISION

ELECTRONIC DATA INTERCHANGE

(1) For the purposes of EDI, to terminate a guaranty contract when an insurer receives written notice of cancellation of coverage from an employer pursuant to ORS 656.423, the insurer must:

(a)

Provide notice to the director no more than seven calendar days after the effective date of termination by transmitting the transaction type for cancellation by insured or nonrenewal by insured.  The “transaction effective date” will be used to report the effective date of termination pursuant to ORS 656.427;

(b)

Retain the employer's written notice for inspection by the division; and

(c)

Provide written notice to the employer pursuant to ORS 656.427(1) and (3).

(2) For the purposes of EDI, to terminate a guaranty contract for any other reason, the insurer must:

(a) Provide notice to the director no more than seven calendar days after the effective date of termination by transmitting the transaction type for cancellation or nonrenewal pursuant to section (5) below; and

(b) Provide written notice to the employer pursuant to ORS 656.427(1) and (3).

(3)

The date of termination must be included in the written notice to the employer to terminate a guaranty contract. For the purposes of notice to the director, the transaction effective date is the termination effective date.

(4)

A delete location transaction can be used to notify the director that one or more locations for an employer are no longer workplaces of the employer.  This transaction does not meet the requirements of ORS 656.427 for notice of termination.  

(5)

If the intent of an insurer is to terminate guaranty contract liability for all insureds under a policy, the insurer must use a cancellation or nonrenewal transaction type and must report all covered employers.

(6) Delete jurisdiction transactions are not capable of being processed by the division’s information processing system and will result in a transaction rejected acknowledgement being sent to the sender.

(7) Failure to provide timely notice to the director of termination of an insurer’s guaranty contract may result in civil penalties pursuant to ORS 656.745.

Stat. Authority:  ORS 656.726(4)

Stat. Implemented:  ORS 656.264, ORS 656.419*, ORS 656.423* and ORS 656.427* *(sections 3, 4, & 5, chapter 170, Oregon Laws 2003)

Hist:  Adopted 3/17/03 as Admin. Order 03-052, eff 4/1/03

Amended 12/3/03 as Admin. Order 03-064, eff. 1/1/04

436-160-0360Page 10436-160-0360

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