No insurance company doing business in the State of Ohio shall pay a claim of a named insured for fire damage to a building or other structure located within the City of Lancaster where the amount recoverable for the fire loss to the building or other structure under all insurance policies exceeds five thousand dollars ($5,000.00) and the loss equals or exceeds sixty percent (60%) of the aggregate limits of liability on all fire policies covering the building or structure unless there is compliance with the following procedures:
(a) (1) When the loss agreed to between the named insured or insureds and the insurance company or insurance companies equals or exceeds sixty percent (60%) of the aggregate limits of liability on all fire policies covering the buildings or structure, the insurance company or companies in accordance with subparagraph (F) of Section 715.26 of the Ohio Revised Code shall transfer from the insurance proceeds to the Service-Safety Director in the aggregate of two thousand dollars ($2,000.00) for each fifteen thousand dollars ($15,000.00), and each fraction of that amount, of a claim or, if at the time of a proof of loss agreed to between the named insured or insureds and the insurance company or companies the named insured or insureds have submitted a contractor’s signed estimate of the costs of removing, repairing, or securing the building or other structure, shall transfer from the insurance proceeds the amount specified in the estimate.
(2) Such transfer of proceeds shall be on a pro rata basis by all companies insuring the building or structure. Policy proceeds remaining after the transfer to the City of Lancaster may be disbursed in accord with the policy terms.
(3) The named insured or insureds 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 Service-Safety Director, after notifying the Fire Chief and City Engineer, shall return the amount of the fund in excess of the estimate to the named insured or insureds provided that the City has not commenced to remove, repair, or secure the building or other structure.
(Ord. 21-04. Passed 4-12-04.)
(b) Upon receipt of proceeds by the City of Lancaster as authorized by the Service- Safety Director by this Section, the Treasurer shall then place the proceeds in a separate fund to be used solely as security against the total cost of removing, repairing or securing the building or structure incurred by the City, pursuant to Section 715.261 of the Ohio Revised Code and the provisions of this Chapter.
When transferring the funds as required in subparagraph (A) of this section, an insurance company shall provide the City of Lancaster with the name and address of the named insured or insureds, whereupon the City shall contact the named insured or insureds, certify that the proceeds have been received by the City and notify them that the following procedure will be followed. The fund shall be returned by the Treasurer at the request of the Service-Safety Director to the named insured or insureds when repairs, or removal, or securing of the building or other structure have been completed and the required proof is received by the Ohio Department of Insurance, provided that the City has not incurred any costs for repairs, removal, or securing. If the City has incurred any costs for repairs, removal or securing of the building or other structure, such costs shall be paid from the fund and if excess funds remain, the City shall transfer the remaining funds to the named insured or insureds after repairing, rebuilding, or removal has been completed. Nothing in this section shall be construed to limit the ability of the City to recover any deficiency under Section 715.261 of the Ohio Revised Code.
Nothing in Section 3929.86(C) of the Ohio Revised Code, as adopted by this ordinance, shall be construed to prohibit the City and the named insured or insureds from entering into an agreement that permits the transfer of funds to the named insured or insureds if some other reasonable disposition of the damaged property has been negotiated. (Ord. 14-97. Passed 2-24-97.)