PRIOR PRINTER'S NO. 2911 PRINTER'S NO. 3692
No. 2201 Session of 1998
INTRODUCED BY ARGALL, HENNESSEY, BELFANTI, GEORGE, MELIO, RAMOS,
THOMAS AND HALUSKA, FEBRUARY 10, 1998
AS REPORTED FROM COMMITTEE ON INSURANCE, HOUSE OF
REPRESENTATIVES, AS AMENDED, JUNE 8, 1998
AN ACT
1 Amending the act of May 17, 1921 (P.L.682, No.284), entitled "An
2 act relating to insurance; amending, revising, and
3 consolidating the law providing for the incorporation of
4 insurance companies, and the regulation, supervision, and
5 protection of home and foreign insurance companies, Lloyds
6 associations, reciprocal and inter-insurance exchanges, and
7 fire insurance rating bureaus, and the regulation and
8 supervision of insurance carried by such companies,
9 associations, and exchanges, including insurance carried by
10 the State Workmen's Insurance Fund; providing penalties; and
11 repealing existing laws," further providing for municipal
12 certificate prior to payment of fire loss claims; and making
13 editorial changes.
14 The General Assembly of the Commonwealth of Pennsylvania
15 hereby enacts as follows:
16 Section 1. Section 508(d), (i) and (j) of the act of May 17,
17 1921 (P.L.682, No.284), known as The Insurance Company Law of
18 1921, amended October 13, 1994 (P.L.609, No.93), are amended to
19 read:
20 Section 508. Municipal Certificate Required Prior to Payment
21 of Fire Loss Claims.--* * *
22 (d) (1) Upon receipt of proceeds by the municipality as
1 authorized by this section, the designated officer shall place
2 the proceeds in a separate fund to be used solely as security
3 against the total cost of removing, repairing or securing
4 incurred by the municipality. When transferring the funds as
5 required in subsection (c) of this section, an insurance
6 company, association or exchange shall provide the municipality
7 with the name and address of the named insured, whereupon the
8 municipality shall contact the named insured, certify that the
9 proceeds have been received by the municipality and notify the
10 named insured that the procedures under this subsection shall be
11 followed.
12 (2) The notification to the named insured required by this
13 subsection shall include a copy of this section and, unless an
14 emergency situation as defined in subsection (j) exists, a
15 detailed estimate of the total costs which may be incurred by
16 the municipality for repairs, removal or securing of the
17 building or other structure, together with the costs itemized
18 under such categories as labor, materials, inspection costs and
19 any other appropriate designation. The cost of preparing the
20 estimate shall not be considered a cost for the repair, removal
21 or securing of the building or other structure AS LONG AS THE <--
22 NAMED INSURED COMPLETES THE REPAIR, REMOVAL OR SECURING OF THE
23 BUILDING OR OTHER STRUCTURE. If no emergency situation as
24 defined in subsection (j) exists, a statement shall accompany
25 the notification and shall specify the time during which WHEN <--
26 the municipality will not commence any repair, removal or <--
27 securing of the building or other structure, which time shall be <--
28 not be less than thirty days from the date the municipality
29 notifies the named insured that procedures under this subsection
30 shall be followed. Nothing in this subsection shall preclude the
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1 named insured from repairing, removing or securing a building or
2 other structure after the thirty-day period if the named insured
3 provides written notice to the municipality and the municipality
4 has not either commenced to remove, repair or secure the
5 building or other structure or engaged another to remove, repair
6 or secure the building or other structure.
7 (3) The fund shall be returned to the named insured when
8 repairs, removal or securing of the building or other structure
9 have been completed and the required proof received by the
10 designated officer if the municipality has not incurred any
11 costs for repairs, removal or securing. If the municipality has
12 incurred costs for repairs, removal or securing of the building
13 or other structure, the costs shall be paid from the fund, and,
14 if excess funds remain, the municipality shall transfer the
15 remaining funds to the named insured. Nothing in this section
16 shall be construed to limit the ability of a municipality to
17 recover any deficiency. Further, nothing in this subsection
18 shall be construed to prohibit the municipality and the named
19 insured from entering into an agreement that permits the
20 transfer of funds to the named insured if some other reasonable
21 disposition of the damaged property has been negotiated.
22 * * *
23 (i) When an ordinance is first passed or adopted by a
24 municipality under subsections (a) and (b) of this section or
25 subsections (c) and (d) of this section, or both, an exact copy
26 of the ordinance shall be filed with the Department of Community
27 [Affairs] and Economic Development, together with the name,
28 position and phone number of the municipal official responsible
29 for compliance with this section. Each municipality enacting an
30 ordinance under this section shall supply the information
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1 required by this subsection to the Department of Community
2 [Affairs] and Economic Development as part of the implementation
3 of its ordinance. The Department of Community [Affairs] and
4 Economic Development shall periodically produce a register
5 listing those municipalities filing the ordinance. This register
6 shall be made available to insurance companies at minimum cost.
7 An insurance company, association or exchange shall not be
8 required to comply with any municipal ordinance if the
9 municipality fails to provide a copy of the ordinance to the
10 Department of Community [Affairs] and Economic Development.
11 (j) The term "municipality," as used in this section, shall
12 mean any city, borough, town, township or home rule
13 municipality. The term "treasurer," as used in this section,
14 shall mean an elected treasurer or other appropriate municipal
15 officer authorized to collect real property taxes. The term
16 "emergency situation," as used in this section, shall mean a
17 property which poses a threat to the health or safety of the
18 public unless repaired, removed or secured immediately.
19 * * *
20 Section 2. This act shall take effect in 60 days.
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