Bill would require insurers to share restitution awards with DOJ victim services

Senate Committee on Judiciary Chair Senator Prozanski opened public testimony Thursday on House Bill 3,816 A, which would require that when an insurance carrier receives a restitution award through criminal proceedings under ORS 137.103, ORS 419C.450, or ORS 811.706, the insurer must pay 50% of that award to the Oregon Department of Justice to fund victim services.

Why it matters: Proponents told the committee that insurers can pursue the same recovery in civil court and that use of criminal proceedings enlists publicly funded prosecutors; they argued the 50% share would help fund services for crime survivors. Opponents raised constitutional and practical concerns during committee questions.

"If an insurance carrier avails themselves to the criminal justice process to seek a restitution judgment, half of the money that is collected will go to the Department of Justice to fund victim services," said Representative Jason Krupp, who testified in support. Krupp, who identified himself as a former prosecutor, described the additional work prosecutors perform when proving restitution in criminal cases and said the measure was intended to recognize that public cost.

A legislative staff overview noted the bill's text and said the measure would credit the full restitution amount to the defendant against any civil judgment and would allow an insurer to direct a district attorney not to seek restitution so the insurer can instead pursue recovery through civil litigation. The staff summary also said the bill received 50 ayes and 1 nay on the House floor and that fiscal and revenue impacts were indeterminate.

Senator McClain asked whether insurers had raised a takings claim under the U.S. Constitution; Representative Krupp replied that insurers were not required to use the criminal process and that the bill leaves insurers free to pursue civil remedies instead. Chair Prozanski further clarified on the record that individual victims' claims for medical bills or damaged property would not be reduced by the insurer's obligation under the bill.

The committee recorded testimony, closed the public hearing on HB 3,816 A and took no final action on the measure during the hearing.

Ending: The public hearing on HB 3,816 A was closed after testimony; committee staff and members did not adopt a work-session recommendation at the hearing, and the measure remains subject to follow-up in a work session or future committee action.