No insurer shall pay a fire loss claim of a named insured, unless the
insurer and the named insured comply with the provisions of this chapter.
After full compliance with the requirements of §
126-8 of this chapter, the insurer shall pay the claim of the named insured, provided however, that if the loss agreed upon by the named insured and the insurer equals or exceeds 60% of the aggregate limits of liability on all applicable fire policies, the following procedures shall be followed:
A. The insurer shall transfer from the insurance proceeds
to the Municipal Officer the aggregate
of $2,000 for each $15,000 of a claim and for each fraction of that amount
of a claim, provided:
(1) This section is to be applied such that if the claim
is $15,000 or less, the amount transferred to the Borough of Carlisle shall
be $2,000.
(2) 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 insurer shall
transfer to the Borough of Carlisle from the insurance proceeds the amount
based upon the estimate.
B. The transfer of proceeds shall be on a pro rata basis
by all insurers and on all applicable policies. Policy proceeds remaining
after the transfer to the Borough of Carlisle shall be disbursed in accordance
with the policy terms.
After the transfer, the named insured may submit a contractor's
signed estimate of the costs of removing, repairing or securing the building
or other structure and the Municipal Officer shall return to the named insured
the amount of the funds transferred to the Borough of Carlisle in excess of
the estimate, provided that the Borough of Carlisle has not commenced to remove,
repair or secure the building or other structure.
Upon the receipt of proceeds under this section, the Borough of Carlisle
shall do the following:
A. The Municipal Officer shall place the proceeds in a separate
fund to be used solely as security against the total costs which are incurred
by the Borough of Carlisle for removing, repairing or securing the building
or structure. Such costs shall include, without limitation, any engineering,
legal or administrative costs incurred by the Borough of Carlisle in connection
with such removal, repair or securing of the building or any proceedings related
thereto.
B. At the time of transfer of such proceeds, the insurer
shall provide the Borough of Carlisle with the name and address of the named
insured. Upon receipt of the transferred funds and the name and address of
the named insured, the Municipal Officer shall contact the named insured,
certify that the proceeds have been received by the Borough of Carlisle and
notify the named insured that the procedures under this section shall be followed.
C. When repairs, removal or securing of the building or
other structure have been completed in accordance with all applicable regulations
and orders of the Borough of Carlisle and the required proof of such completion
received by the Municipal Officer and if the Borough of Carlisle has not incurred
any costs for repairs, removal or securing, the fund shall be returned to
the named insured. If the Borough of Carlisle 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 of Carlisle shall
transfer the remaining funds to the named insured.
D. To the extent that interest is earned on proceeds held
by the Borough of Carlisle pursuant to this section, and retained by it, such
interest shall belong to the Borough of Carlisle. To the extent that proceeds
are returned to the named insured, interest earned on such proceeds shall
be distributed to the named insured at the time that the proceeds are returned.
Nothing in this article shall be construed to limit the ability of the
Borough of Carlisle to recover any deficiency. Furthermore, nothing in this
article shall be construed to prohibit the Borough of Carlisle and the named
insured from entering into an agreement that permits the transfer of funds
to the named insured if some reasonable disposition of the damaged property
has been negotiated.
The Borough Council may, by resolution, adopt additional procedures
and regulations to implement this article and may, by resolution, fix reasonable
fees to be charged for Municipal activities or services provided pursuant
to this article including, but not limited to, issuance of certificates and
bills, performance of inspections and opening separate fund accounts.