[Ord. 1721, 1/11/1993, § 1]
This Part is enacted pursuant to Act. No. 1992-98, House Bill
No. 1028, and is intended to establish procedures for the escrowing
of fire insurance proceeds.
[Ord. 1721, 1/11/1993, § 1]
No insurance company, association or exchange doing business
in this Commonwealth shall pay a claim of a named insured for fire
damage to a structure located within the Borough where the amount
recoverable for the fire loss to the structure under all policies
exceeds $5,000, unless there is compliance with the procedures set
forth in this Part.
[Ord. 1721, 1/11/1993, § 1; as amended by Ord.
1856, 9/8/1997, § 1]
When the loss agreed to between the named insured and the company,
association or exchange equals or exceeds 60% of the aggregate limits
of liability on all fire policies covering the building or other structure,
the insurance company, association or exchange shall transfer from
the insurance proceeds to the Borough Code Enforcement Officer $2,000
for each $15,000 and each fraction of that amount of a claim. However,
if, at the time of a proof of loss agreed to between the named insured
and the insurance company, association or exchange, the named insured
has submitted a contractor's signed estimate of the costs of
removing, repairing or securing the building or other structure, the
insurance company, association or exchange shall transfer from the
insurance proceeds the amount specified in the estimate. The transfer
of proceeds shall be on a pro rata basis by all companies, associations
or exchanges insuring the building or other structure. Policy proceeds
remaining after the transfer to the Borough shall be disbursed in
accordance with the policy terms. The named insured may submit a contractor's
signed estimate of the costs of removing, repairing or securing the
building or other structure after the transfer, and the Code Enforcement
Officer shall return the amount of the fund in excess of the estimate
to the named insured if the Borough has not commenced to remove, repair
or secure the building or other structure.
[Ord. 1721, 1/11/1993, § 1]
Upon receipt of the proceeds by the Borough, the Code Enforcement
Officer shall place the proceeds in a separate fund to be used solely
as security against the total cost of removing, repairing or securing
incurred by the Borough. When transferring the funds as required in
§ 303, an insurance company, association or exchange shall
provide the Borough with the name and address of the named insured,
whereupon the Borough shall contact the named insured, certify that
the proceeds have been received by the Borough and notify the named
insured that the procedures under this Part shall be followed. The
fund shall be returned to the named insured when repairs, removal
or securing of the building or other structure have been completed
and the required proof received by the Code Enforcement Officer if
the Borough has not incurred any costs for repairs, removal or securing.
In the event the Borough has incurred costs for repairs, removal or
securing of the building or other structure, the costs shall be paid
from the fund, and, if excess funds remain, the Borough shall transfer
the remaining funds to the named insured.
[Ord. 1721, 1/11/1993; as added by Ord. 1726, 4/12/1993,
§ 1]
Any person violating any of the provisions of this Part shall
be guilty of the offense charged and, upon conviction thereof in summary
proceedings, shall be sentenced to pay the costs of prosecution and
a fine of not more than $1,000 to the use of the Borough and, in default
of the payment thereof, shall be imprisoned for a period not to exceed
90 days.
