[HISTORY: Adopted by the Borough Council of the Borough of Avondale as indicated in article histories. Amendments noted where applicable.]
[Adopted 7-16-2013 by Ord. No. 239]
The provisions of this article are enacted pursuant to the Pennsylvania Insurance Company Law, as amended (the "Act," Section 508, 40 P.S. § 638), and are intended to implement and comply with the Act.
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 of Avondale ("Borough") where the amount recoverable for the fire loss to the structure under all policies exceeds $7,500, unless the insurance company, association or exchange is furnished with a certificate pursuant to § 241-3 hereof, and unless there is compliance with the procedures set forth in §§ 241-4 and 241-5 hereof.
A. 
The Borough Treasurer shall, upon the written request of the named insured specifying the tax description of the property, name and address of the insurance company, association or exchange and 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 following within 14 working days of the request:
(1) 
A certificate or, at the discretion of the Borough, a verbal notification which shall be confirmed in writing by the insurer to the effect 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 or verbal notification, no municipality has certified any amount as total costs incurred by the municipality 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 also showing, as of the date of the Treasurer's certificate, the amount of the total costs, if any, certified to the Treasurer that have been incurred by a municipality for the removal, repair or securing of a building or other structure on the property. For the purposes of this subsection, the municipality shall certify to the Treasurer the total amount, if any, of such costs. 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.
B. 
Payment of claims to named insured.
(1) 
Upon the receipt of a certificate pursuant to § 241-3A(1), 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 Borough shall follow the procedures set forth in §§ 241-4 and 241-5 hereof.
C. 
Payment of delinquent taxes and charges.
(1) 
Upon the receipt of a certificate and bill pursuant to § 241-3A(2), 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 Borough 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 designated officer of the municipality in the aggregate $2,000 for each $15,000 and each fraction of that amount of a claim, or, 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 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 designated 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. This section only applies after the adoption of this article.
Upon receipt of proceeds by the Borough as authorized by this article, the Borough Treasurer 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 § 241-4 hereof, 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 article 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 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 article shall be construed to limit the ability of the Borough to recover any deficiency. Further, nothing in this article 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.