[HISTORY: Adopted by the Borough Council of the Borough of Norristown 5-2-1995 as Ord. No. 95-11. Amendments noted where applicable.]
No insurance company, association or exchange (hereinafter the "insurer") doing business in the Commonwealth of Pennsylvania shall pay a claim of a named insured for fire damage to a structure located within the Borough of Norristown where the amount recoverable for the fire loss to the structure under all policies exceeds seven thousand five hundred dollars ($7,500.), unless the insurer is furnished by the Borough of Norristown with a certificate pursuant to Section 508(b) of the Insurance Company Law of 1921, amended by Act 98 of 1992 and Act 93 of 1994 (collectively, the "Act"), and unless there is compliance with the procedure set forth in Section 508(c) and (d) of the Act.
Editor's Note: See 40 P.S. § 638.
Where there are delinquent taxes, assessments, penalties or user charges against the property ("municipal claims") or there are expenses which the Borough of Norristown has incurred as costs for the removal, repair or securing of a building or other structure on the property (collectively, "municipal expenses"), the Borough Manager of the Borough of Norristown shall immediately render a bill for such work if he has not already done so.
Upon written request of the named insured specifying the tax description of the property, the name and address of the insurer and the date of receipt by the insurer of a loss report of the claim, the Borough Treasurer shall furnish within fourteen (14) working days after the request to the insurer a certificate (or at his discretion an oral notification confirmed in writing) either:
Taxes, assessments, penalties and user charges shall be deemed delinquent for this purpose if a lien could have been filed for such claims under applicable law. Upon receipt of a certification and bill pursuant to Subsection B(1)(b) of the preceding subsection, the insurer shall transfer to the Borough Treasurer an amount from the insurance proceeds sufficient to pay such sums prior to making payment to the named insured, subject to the provisions of Subsection C hereof.
When all municipal claims and municipal expenses have been paid pursuant to Subsection B of this section or where the Treasurer has issued a certificate described in Subsection B(1)(a) indicating that there are no municipal claims or municipal expenses against the property, the insurer shall pay the claim of the named insured; provided, however, that if the loss agreed upon by the named insured and insurer equals or exceeds sixty percent (60%) of the aggregate limits of liability on all fire policies covering the building or structure, the following procedures must be followed:
The insurer shall transfer from the insurance proceeds to the Treasurer, in the aggregate, two thousand dollars ($2,000.) for each fifteen thousand dollars ($15,000.) of such claim or fraction thereof.
If, at the time a loss report is submitted by the insured, such insured has submitted to the insurer, with a copy to the Borough of Norristown, a contractor's signed estimate of the cost 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 Treasurer from the insurance proceeds the amount specified in the estimate. If there is more than one (1) insurer, the transfer of proceeds shall be on a pro rata basis by all insurers, including the building or other structure.
Upon receipt of the above-described portion of the insurance proceeds, the Treasurer shall do the following:
Place the proceeds in a separate fund to be used solely as security against the total municipal expenses anticipated by the Borough of Norristown to be required in removing, repairing or securing the building or structure as required by this chapter. Such costs shall include, without limitation, any engineering, legal or administrative costs incurred by the Borough of Norristown in connection with such removal, repair or securing or any proceedings related thereto.
Mail to the named insured, at the address received from the insurer, a notice that the proceeds have been received by the Borough of Norristown and that the procedures under this subsection shall be followed.
After the transfer, the named insured may submit to the Borough of Norristown a contractor's signed estimate of the costs of removing, repairing or securing the building or other structure, in which event the Treasurer shall, if such estimate is deemed by the Treasurer to be reasonable, return to the insured the amount of the funds transferred to the Borough of Norristown in excess of that required to pay the municipal expenses, provided that the Borough of Norristown has not commenced to remove, repair or secure the building or other structure, in which case the Borough of Norristown will complete the work.
Pay to the Borough Manager, for reimbursement to the Borough of Norristown general fund, the amount of the municipal expenses paid by the Borough of Norristown.
Pay the remaining balance in the fund (without interest) to the named insured upon receipt of a certificate issued by the Code Enforcement Officer, Building Inspector or other applicable official of the Borough of Norristown that the repair, removal or securing of the building or other structure has been completed in accordance with all applicable codes and regulations of the Borough of Norristown.
Nothing contained in this section shall be construed to limit the ability of the Borough of Norristown to recover any deficiency in the amount of municipal claims or municipal expenses recovered pursuant to this chapter, or to insurance proceeds, by an action at law or equity to enforce the codes of the Borough of Norristown or to enter into an agreement with the named insured with regard to such other disposition of the proceeds as the Borough of Norristown may deem reasonable.
Any owner of property, any named insured or insurer who violates the provisions of this section or who shall fail to comply with any of the requirements hereof shall be liable, upon summary conviction, to fines and penalties not exceeding one thousand dollars ($1,000.), which fines and penalties may be collected by suit or summary proceeding brought in the name of the Borough of Norristown before any District Justice or recovered as debts of the like amount are now by law recoverable.