These rules set forth standards to protect consumers from misleading and fraudulent marketing practices with respect to the use of special designations and certifications in the solicitation, sale or purchase of, or advice made in connection with an insurance product or in providing advice as to the value of or the advisability of purchasing insurance.

To link to the Oregon Division rules page, click HERE

To link to the specific rule, click HERE

“Dear PIB, my father-in-law recently passed away.  We have found out that he has several life insurance policies that show his wife (my mother) as the beneficiary on both policies.  When reading his will, the attorneys discovered that he attempted to change who gets the life insurance money through the will.  As best as we can determine, no changes were ever made at the insurance company.  We have talked to his agent, the insurance company and anyone else with knowledge about the life insurance payment and it appears as if the will won’t change anything…it had to be done through the insurance company in order to be effective.  The reason I ask is that the will named my husband and me as the people who were supposed to get the money.  We don’t need the money, it’s just that my mother has a tendency to spend money on things that she doesn’t need and we’re worried that she’ll spend it foolishly.  Any advice?  Thanks, Stephanie.

Dear Stephanie,

It is extremely rare that a last will and testament will change or overturn a life insurance beneficiary designation shown in the life insurance contract.  There are certain state-mandated requirements as to who can actually be named as a beneficiary in certain plans, like Qualified Retirement Plans (QRPs) and IRAs.  Most states require that your legally-married spouse is the beneficiary on QRPs and at times, IRAs, unless the spouse waives their right to the designation in writing.

As well, the only instances in which I have actually seen a life insurance beneficiary designation overturned is where the plaintiff was able to prove that the designation was made under duress, such as the beneficiary threatening to do some sort of harm to the policyowner- “I’m going to ruin your life unless you make me the beneficiary” kind of thing.  Other than that, I’ve never seen a court overturn a beneficiary designation.  Now, I’ll be the first to admit that I haven’t seen everything, but I haven’t seen this.

Another concern is that if in fact the will did govern the distribution of the life insurance assets, then those assets would be subject to probate cost and potential estate taxation.  Not a good thing!  Life insurance is intended to be held outside of the estate; it preserves the federal tax-free status of the death benefit.

• November 11, 2009
• December 2, 2009

Hope to see you there!

Please make sure that you bring all of you classroom materials (if you actually attended a class!) and plenty of paper, pens and highlighters for all of those notes you’re going to be taking!

In addition to the fees that have been historically required ($30 application fee + a $45 license fee), there is an additional fee of $47.25 that will pay for the federal and state criminal background check that is required to be performed before a license can be issued.    This fee must be included when you pay for the “other” required fees.  Read on for more!

To quote Jim Thompson, Oregon’s Insurance Division Manager of Licensing:

As of September 1, 2009, the Oregon Insurance Division is required to conduct criminal background checks of all applicants for an initial resident license.

In addition to submitting the application for a license and the existing $75 license and application fees, all applicants for a resident license must submit:

1. a completed Criminal Records Request form
2. a fingerprint card
3. $47.25 to cover the cost of a background check of state and federal criminal records

Any applicant who has submitted an application on or after September 1, 2009 is required to complete the Criminal Records Request form and submit it with a check or money order for $47.25.  Applications received on or after September 1 will not be processed until this form and fee are both received.  The division will contact all applicants who have submitted an application within this timeframe with instructions.

The rules outlining what convictions are relevant to obtaining a producer license are OAR 836-072-0001 – OAR 836-072-0045. You can find them at:  http://arcweb.sos.state.or.us/rules/OARS_800/OAR_836/836_072.html

Please allow 7-10 days for background check processing in addition to the time for application processing.

Contact Jim Thompson, Producer Licensing Manager, with any questions at 503-947-7247, or by email at James.T.Thompson@state.or.us.

• your textbooks (if you have attended the lecture class or have purchased the books)
• plenty of notepaper and a pen and highlighter
• all of your questions and concerns

Click HERE for directions to the classroom!  There is no cost for ProSchools enrollees and a $99 charge for non-ProSchools enrollees.  Hope to see you there!

The review session will run from 10:00 am until approximately 4:00 pm and there is no pre-registration required if you are a current ProSchools student; just show up!   For those of you not currently enrolled, please call 800-452-4879, x 105 to enroll!  Please make sure to bring your books, notes and plenty of paper to write on for more notes!

“This webinar will help you create an environment that encourages conversations, sharing content, and building relationships online and off using social media! It’s a new way of doing business, and it’s very often free (or nearly free). But how do blogs, wikis, widgets, and niche networking sites help real estate and insurance agents?  Attend the webinar and find out!“

There is no cost to attend this event; you simply need to sign up.  If you sign up for the webinar, you’ll receive discounts on your ProSchools insurance continuing education as well!  Click on the following links for more information and to sign up for the event!

For information on the webinar and to register, click on this link:  Social Media Webinar Info/Registration

For information on other webinars ProSchools is holding in the future, click on this link:  Upcoming ProSchools Webinars

We look forward to having you in on this event.  Social media and social networking efforts are now considered critical for an insurance agent’s success, and can lead to all sorts of important business connections including new client resources!

• For Initial Licenses:
  • Resident Producers (per line):                            Currently:  $52           As of 7/1/2009:  $71
  • Non-Resident Producers (per line):                    Currently:  $93           As of 7/1/2009:  $112
• For Renewal Licenses:
  • Resident Producers (per line):                           Currently:  $13           As of 7/1/2009:  $32
  • Non-Resident Producers (per line):                   Currently:  $41           As of 7/1/2009:  $60

Click HERE for DORAs file that details all of the changes!

For life insurance only candidates: click HERE

For accident and health insurance only candidates:  click HERE

For life and accident and health candidates:  click HERE

Additional Material Added Effective 7/1/2009

Section 11.2:  Disability Income:

Annual Renewable Term Rider: This is a rider added to a disability income (DI) policy that allows the insured to renew the policy annually to a certain age (commonly 65) without evidence of insurability.  This rider is normally added to individual disability income policies that are not issued “guaranteed renewable.”  The premium can increase annually on an individual basis.  In comparison, guaranteed renewable DI contracts guarantee the ability to renew to a certain age (commonly age 65) but cannot change the premium rate based on an individual’s situation.  Instead, guaranteed renewable policies state that the insurer can only raise rates on a “class” basis and only once per year on the policy’s anniversary.

Disability Reducing Term Rider: This rider is designed to cover a loan amount for a specified period of time. The amount of benefit decreases each year as the amount of the loan decreases.  The policy’s purpose is to pay the monthly loan payment while the owner is totally disabled.  The business purchases and owns the policy, the business owner is the insured person, and the business or the lender is the beneficiary, depending on the policy.  Premiums are not tax-deductible to the business and the benefits are received tax-free.

Section 16.0:  Federal Tax Considerations for Health Insurance

Taxation on Health Savings Accounts (HSAs) and Health Reimbursement Accounts (HRAs):

Payments for qualified medical expenses from an HSA or HRA are not subject to taxation.  Non-qualified withdrawals are subject to taxation at ordinary income tax rates and if the insured is under age 65, subject to an additional 10% penalty tax imposed on non-qualified withdrawals.  Once the insured turns 65, non-qualified withdrawals are only subject to taxation at ordinary income tax rates.  HSA contributions by an employee can be made on a salary reduction (pre-tax) basis (which serve to lessen the employee’s taxable income for that period) or on an after-tax basis.  If contributions are made on an after- tax basis, they are considered an “above-the-line” deduction on the employee’s income tax forms, thereby serving as a tax deduction (lessening the employee’s taxable income for that tax year).  Employers are able to deduct any contributions made on behalf of employees in the year the contribution was made.

Please let me know if you have any further questions on these additions.  We are in the process of changing our online courses to reflect these changes; this should be used as an interim step to have the current material if you are testing on or after 7/1/2009.