This chapter is adopted pursuant to and implements the provisions of the Insurance Company Law of 1921, as amended, 40 P.S. § 638. No insurance company, association, or exchange doing business in the Commonwealth of Pennsylvania shall pay a claim of a named insured for fire damage to a structure located within Malvern Borough, if the amount recoverable under any or all insurance policies exceeds $7,500, unless the insurance company, association, or exchange is furnished with a certificate pursuant to §
108-2 of this chapter and unless there is compliance with the procedures set forth in §§
108-3 and
108-4 of this chapter.
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 Treasurer the amounts required
by and in accordance with the procedures set forth in 40 P.S. § 638(c).
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 structure or other structure
after the transfer, and the Borough Treasurer 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. The Borough Treasurer shall carry out the duties
of this section.
Upon receipt of the proceeds by the Borough as authorized by §
108-3, the Borough Treasurer shall place the proceeds in a separate fund to be used solely as security against the total cost of removing, repairing, and/or securing incurred by the Borough. When transferring the funds as required in §
108-3, 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 municipality and notify the named insured that the procedures under this section shall be followed. The fund shall be returned to the named insured when repairs, removal, or security of the building or other structure has been completed and the required proof received by the Borough Treasurer if the Borough has not incurred any costs for repairs, removal, or securing. If 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. Nothing in this chapter shall be construed to limit the ability of the Borough to recover any deficiency. Further, nothing in this section shall be construed to prohibit the Borough and the named insured from entering into an agreement that permits the transfer of funds to the named insured if some other reasonable disposition of the damaged property has been negotiated.
The total costs incurred by the Borough for the removal, repair,
or securing of a building or other structure under this chapter shall
include, but not be limited to, all administrative, personnel and
overhead costs, attorney's fees and court costs incurred by the
Borough in accordance with generally accepted accounting procedures.