2017 ORS 746.515¹
Return of unearned premiums on cancellation

(1) Whenever a financed insurance policy is canceled, the insurer who has been notified as provided in ORS 746.475 (Premium finance agreements) (4) shall return whatever gross unearned premiums are due under the insurance policy to the premium finance company for the account of the insured or insureds not later than the 30th day after the date of cancellation. If the insurer elects to return the premium through the insurance producer, the insurance producer shall transmit the unearned premium to the premium finance company within the 30-day period. The insurer, on written notice of any failure of the insurance producer to transmit the premium and not later than the 30th day after the notice, shall pay the amount of return premium directly to the premium finance company.

(2) In calculating the gross unearned premium due under a financed insurance policy, the insurer shall use the prorate method of calculation.

(3) In the event that the crediting of return premiums to the account of the insured results in a surplus over the amount due from the insured, the premium finance company shall refund such excess to the insured provided that no such refund shall be required if it amounts to less than $1. [1969 c.639 §13; 1983 c.239 §7; 2003 c.364 §150]

Notes of Decisions

Insurer’s failure to return gross unearned premium to premium finance company violated require­ment of this sec­tion notwithstanding insurer’s promise to refund premiums directly to insured and its directive to company not to finance policies. Bonneville Auto Ins. Co. v. Ins. Dept., 53 Or App 440, 632 P2d 796 (1981)

This sec­tion does not require insurer to “return” unearned premiums if no premiums have been paid insurer or its agent. C.I.S. Northwest v. Berjac of Portland, 87 Or App 233, 742 P2d 618 (1987), on reconsidera­tion 89 Or App 117, 747 P2d 406 (1987), Sup Ct review denied

1 Legislative Counsel Committee, CHAPTER 746—Trade Practices, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ors746.­html (2017) (last ac­cessed Mar. 30, 2018).
2 Legislative Counsel Committee, Annotations to the Oregon Revised Stat­utes, Cumulative Supplement - 2017, Chapter 746, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ano746.­html (2017) (last ac­cessed Mar. 30, 2018).
3 OregonLaws.org assembles these lists by analyzing references between Sections. Each listed item refers back to the current Section in its own text. The result reveals relationships in the code that may not have otherwise been apparent.