Township of Unity, PA Fire Loss Insurance Proceeds

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 Township where the amount recoverable for the fire loss to the structure under all policies exceeds $7,500, unless (1) the insurance company, association or exchange is furnished with a certificate pursuant to Subsection B of this section and (2) there is compliance with the procedures set forth in Subsections C and D of this section.

Treasurer responsibilities.

(1)

The Township Treasurer shall — upon receipt of a written request of the named insured or insurer, containing:

(a)

The tax description of the property;

(b)

The name and address of the insurance company, association or exchange; and

(c)

The date agreed upon by the insurance company, association or exchange and the named insured as the date of the receipt of a loss report of the claim — furnish the insurance company, association or exchange either of the certificates, where applicable, within 14 working days of the Treasurer's receipt of the request:

[1]

A certificate confirming that, as of the date specified in the request, there are no delinquent taxes, assessments, penalties or user charges against the property and that, as of the date of the Treasurer's certificate, the Township has not incurred any costs for the removal, repair or securing of a building or other structure on the property; or

[2]

A certificate and bill showing the amount of delinquent taxes, assessments, penalties and user charges against the property as of the date specified in the request that have not been paid as of the date of the certificate and/or the amount of the costs, if any, that have been incurred by the Township for the removal, repair or securing of a building or other structure on the property. For the purposes of this subsection, the Township shall certify to the Treasurer the total amount, if any, of such costs. Also for purposes of this subsection, a tax, assessment, penalty or user charge becomes delinquent at the time and on the date a lien could otherwise have been filed against the property by the municipality under applicable law.

(2)

Receipt of certificate.

(a)

Upon the receipt of a certificate pursuant to Subsection B(1)(c)[1] of this subsection, the insurance company, association or exchange shall pay the claim of the named insured in accordance with the policy terms, unless 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. In the case of such a loss, the insurance company, association or exchange, the insured property owner and the Township shall follow the procedures set forth in Subsections C and D of this section.

(b)

Upon the receipt of a certificate and bill pursuant to Subsection B(1)(c)[2] of this subsection, the insurance company, association or exchange shall return the bill to the Treasurer and transfer to the Treasurer an amount from the insurance proceeds necessary to pay the taxes, assessments, penalties, charges and costs as shown on the bill. The Township shall receive the amount and apply or credit it to payment of the items shown in the bill.

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 Township Treasurer a sum in the aggregate equal to $2,000 for each $15,000, and each fraction of that amount, of the claim; provided, however, that if at the time of a loss report the named insured has submitted a contractor's signed estimate of the costs of removing, repairing or securing the building or other structure in an amount less than the amount calculated under the foregoing transfer formula, the insurance company, association or exchange shall transfer from the insurance proceeds the amount specified in the contractor's signed estimate. The transfer of proceeds shall be made 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 Township 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 Township Treasurer shall return the amount of the fund in excess of the estimate to the named insured if the Township has not commenced to remove, repair or secure the building or other structure.

Upon receipt of those proceeds as authorized by this section, the Township Treasurer shall place the proceeds in a separate fund to be used solely as security against the total costs incurred by the Township of removing, repairing or securing any building or property, including, without limitation, any engineering, legal or administrative costs or fees incurred by the Township in connection with same. When transferring the funds as required in Subsection C of this section, an insurance company, association or exchange shall provide the Township with the name and address of the named insured, whereupon the Township shall contact the named insured, certify that the proceeds have been received by the Township and notify the named insured that the procedures under this subsection will be followed. The funds held by the Township shall be returned to the named insured after repairs, removal or securing of the property, building or other structure have been completed and the Township has not incurred any costs for repairs, removal or securing the building or other structure as set forth above. If the Township has incurred costs for repairs, removal or securing of the building or other structure as set forth above, the costs shall be paid from the fund, and, if excess funds remain, the municipality shall transfer the remaining funds to the named insured. Nothing in this section shall be construed to limit the ability of a municipality to recover any deficiency. Further, nothing in this subsection shall be construed to prohibit the municipality and the named insured from entering into an agreement that permits the transfer of funds to the named insured, or their designee, if some other reasonable disposition of the damaged property has been negotiated and approved by the Township.

Proof of payment by the insurance company, association or exchange of proceeds under a policy in accordance with Subsection C of this section is conclusive evidence of the discharge of its obligation to the insured under the policy to the extent of the payment and of compliance by the company, association or exchange with Subsection C of this section.

Nothing in this section shall be construed to make an insurance company, association or exchange liable for any amount in excess of proceeds payable under its insurance policy, or for any other act performed pursuant to this section, or to make a municipality or public official an insured under a policy of insurance or to create an obligation to pay delinquent property taxes or unpaid liens or expenses other than as provided in this section.

An insurance company, association or exchange making payments of policy proceeds under this section for delinquent taxes or structure removal liens or removal expenses incurred by a municipality shall have a full benefit of such payment, including all rights of subrogation and of assignment.

A copy of this section, and any modification or amendment thereof, together with the name and contact information of the Township Treasurer, shall be sent to the Commonwealth of Pennsylvania Department of Community and Economic Development to provide notice of the implementation of this section subject to its terms consistent with the provisions of 40 P.S. 638.