Breaking down a new state law that increases insurance transparency in Oregon
Jillian Fortner
(update: adding video, comments)
BEND, Ore. (KTVZ) – A new state law, House Bill 2563, requires both home and auto insurance companies to clearly explain to policyholders why their premiums are increasing.
The change highlights increasing concern from both regulators and consumers over rising premiums and the unclear reasons behind those price hikes.
Insurers must list up to four main reasons behind any rate hike, using straightforward language instead of technical insurance jargon.
Oregon Consumer Justice supports the new law, which aims to bring more fairness and transparency to insurance pricing.
“We believe that pricing transparency is essential to consumers,” State Policy Director Angela Donley said. “If they’re required to purchase a product, they have a right to know what they’re paying for and that they’re paying a reasonable price.”
James Fleming, a sales executive with Marsh McLennan Agency, said the law won’t change how agents do their jobs, but it will affect how carriers communicate rate changes.
“As far as an agent goes, we don’t physically have to write out the reasoning. That’s all done on the carrier side,” Fleming explained.
He added that customers often express frustration over unexplained premium hikes and sees this new transparency requirement as a positive step.
“This is good, because it’s individualized. It’s specified for each client that inquires,” Fleming said.
The new disclosure rule applies only to policy renewals, not to new insurance applications. Insurance providers will be required to respond within 20 days of the customer’s request.