(a) Pursuant to the provisions of 3929.86 of the Ohio Revised Code and this section, no insurance company doing business in this State shall pay a claim of a named insured fire damage to a structure located within the City of Tiffin where the amount recoverable for the fire loss to the structure under all policies exceeds five thousand dollars unless there is compliance with the procedures set forth in subsections (b) and (c) hereof.
(b) When the loss agreed to between the named insured or insureds and the company or companies equals or exceeds sixty percent of the aggregate limits of liability on all fire policies covering the building or structure, the insurance company or companies, in accordance with Division (F) of Section 715.26 of the Ohio Revised Code shall transfer from the insurance proceeds to the Director of Finance of the City of Tiffin in the aggregate two thousand dollars for each fifteen thousand dollars, 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.
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 of the Municipal Corporation 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 Director of Finance shall return the amount of the fund in excess of the estimate to the named insured or insureds, provided that the Municipal Corporation has not commenced to remove, repair, or secure the building or other structure.
This subsection only applies after the City of Tiffin has adopted an ordinance authorizing the procedure described in subsections (b) and (c) hereof and have filed a certified copy of the ordinance for public record with the Superintendent of Insurance, and applies only to fire losses that occur after the filling of the certified copy. This section designates the Fire Chief or his designee and the Director of Finance of the City of Tiffin to carry out the duties of this section.
(c) Upon receipt of proceeds by the Municipal Corporation as authorized by this section, the designated officers shall place the proceeds in a separate escrow account to be used solely as security against the total cost of removing, repairing, or securing incurred by the Municipal Corporation pursuant to Section 715.261 of the Ohio Revised Code.
When transferring the funds as required in subsection (b) hereof, an insurance company shall provide the City of Tiffin with the name and address of the named insured or insureds, whereupon the designated officers of the City of Tiffin shall contact the named insured or insureds, certify that the proceeds have been received by the Municipal Corporation and notify them that the following procedures will be followed:
(1) The fund shall be returned to the named insured or insureds when repairs, removal, or securing of the building or other structure has been completed and the required proof has been received by the designated officer, if the City of Tiffin has not incurred any costs for the repairs, removal, or securing. However, the funds in the escrow account shall be returned to the named insured or insureds no later than sixty days after the designated officer receives the required proof. If the City of Tiffin has incurred any costs for repairs, removal, or securing of the building or other structure, the costs shall be paid from the escrow account, and if excess funds remain, the City of Tiffin shall transfer, no later than sixty days after all such costs have been paid, the remaining funds to the named insured or insureds. Nothing in this section shall be construed to limit the ability of the Municipal Corporation to recover any deficiency under Section 715.261 of the Revised Code.
(2) Nothing in this subsection shall be construed to prohibit the Municipal Corporation 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) Proof of payment by the company or companies of proceeds under a policy in accordance with subsection (b) hereof is conclusive evidence of the discharge of its obligation to the insured under the policy to the extent of the payment and of compliance by the company or companies with subsection (b) hereof.
(e) 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 of Tiffin or any of its public officials 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 in this section .
(f) An insurance company making payment of policy proceeds under this section for structure removal liens or removal expenses incurred by the Municipal Corporation shall have the full benefit of such payment including all rights or subrogation and of assignment.
(g) As used in this section and Section 3929.87 the Revised Code, “insurance company” or “insurer” includes the Ohio Fair Plan Underwriting Association as established in Section 3929.43 of the Revised Code.
(h) 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. (Ord. 95-17. Passed 5-1-95.)