(A) No insurance company doing business in the state shall pay a claim of a named insured for fire damage to a structure located within the city where the amount recoverable for the fire loss to the structure under all policies exceeds $5,000, unless there is compliance with the following procedures.
(1) (a) When the loss agreed to between the named insured or insureds and the company or companies equals or exceeds 60% of the aggregate limits of liability on all fire policies covering the building or structure, the insurance company or companies, in accordance with R.C. § 715.26(F), shall transfer from the insurance proceeds to the City Auditor 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 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.
(b) The transfer of proceeds shall be on a pro rata basis by all companies insuring the building or other structure. Policy proceeds remaining after the transfer to the city shall be disbursed in accordance with the policy terms. 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 City Auditor, after notifying the City Manager, 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.
(2) (a) Upon receipt of proceeds by the city as authorized by this section, the City Auditor 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 city pursuant to R.C. § 715.261.
(b) When transferring the funds as required in division (A) above, an insurance company shall provide the city 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 procedures will be followed: The fund shall be returned to the named insured or insureds when repairs, removal or securing of the building or other structure have been completed and the required proof has been received by the City Manager, if the city has not incurred any costs for the repairs, removal or securing. However, the fund shall be returned to the named insured or insureds no later than 60 days after the City Auditor receives the required proof. If the city has incurred any 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 city shall transfer, no later than 60 days after all such costs have been paid, the remaining funds to the named insured or insureds.
(B) Nothing in this section shall be construed to limit the ability of the city to recover any deficiency under R.C. § 715.261.
(C) Nothing in this section 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.
(D) Nothing in this section shall be construed to make an insurance company liable for any amount in excess of proceeds payable under its insurance policy or for any other act performed pursuant to this section, or to make the city an insured under a policy of insurance, or to create an obligation to pay delinquent property taxes or unpaid removal liens or expenses other than as provided by law.
(E) As used in this section and R.C. § 3929.87, “insurance company” or “insurer” includes the State Fair Plan Underwriting Association as established in R.C. § 3929.43.
(F) The City Auditor is hereby designated as the officer authorized to carry out the duties of this section, provided that no funds so held under this section shall be released without notification of such intent to the City Manager.
(G) This section shall be liberally construed to accomplish its purpose to deter the commission of arson and related crimes, to discourage the abandonment of property and to prevent urban blight and deterioration.
(Prior Code, § 9.15.01.09)