Bill Text: FL S1392 | 2019 | Regular Session | Introduced
Bill Title: Insurance Proceeds Held by Mortgagees or Assignees
Spectrum: Partisan Bill (Republican 1-0)
Status: (Failed) 2019-05-03 - Died in Banking and Insurance [S1392 Detail]
Download: Florida-2019-S1392-Introduced.html
Florida Senate - 2019 SB 1392 By Senator Gainer 2-01609A-19 20191392__ 1 A bill to be entitled 2 An act relating to insurance proceeds held by 3 mortgagees or assignees; amending s. 494.0026, F.S.; 4 providing that an insured or a borrower is entitled to 5 any accrued interest on certain insurance proceeds 6 held by the mortgagee or assignee in a segregated 7 account; specifying when such interest is payable; 8 requiring mortgage lenders to issue an annual 9 statement of the account to the insured or borrower; 10 specifying requirements and procedures for, and 11 authorized actions of, mortgagees and assignees in 12 disbursing insurance proceeds to insureds; providing 13 an effective date. 14 15 Be It Enacted by the Legislature of the State of Florida: 16 17 Section 1. Section 494.0026, Florida Statutes, is amended 18 to read: 19 494.0026 Disposition of insurance proceeds.—The following 20 provisions apply to mortgage loans held by a mortgagee or 21 assignee that is subject to part II or part III of this chapter. 22 (1) The mortgagee or assignee must promptly endorse a 23 check, draft, or other negotiable instrument payable jointly to 24 the mortgagee or assignee and the insured by the insurance 25 company. However, the mortgagee or assignee is not required to 26 endorse such instrument if the insured or a payee who is not 27 subject to part II or part III of this chapter refuses to 28 endorse the instrument. 29 (2) Insurance proceeds received by a mortgagee or assignee 30 whichthatrelate to compensation for damage to property or 31 contents insurance coverage in which the mortgagee or assignee 32 has a security interest must be promptly deposited into a 33 segregated account of a federally insured financial institution. 34 (a) The insured or borrower is entitled to any interest 35 accrued in the segregated account containing the insurance 36 proceeds. The interest is payable at the time of final 37 distribution of the proceeds. 38 (b) At the expiration of the annual accounting period, the 39 mortgage lender shall issue the insured or borrower an annual 40 statement for the account. 41 (3) If the insured is in good standing on his or her 42 mortgage and the aggregate insurance claims payments are less 43 than $20,000, the mortgagee or assignee must endorse and 44 expedite the mailing and release of any insurance claims 45 proceeds back to the insured within 14 days after receipt. 46 (4) If the insurance proceeds relating to compensation for 47 damage to property or contents insurance coverage in which the 48 mortgagee or assignee has a security interest is greater than 49 $20,000 or if the mortgage account is in arrears, the mortgagee 50 or assignee must place the proceeds in a segregated account 51 pursuant to subsection (2) and must disburse the claim payments 52 as follows: 53 (a) An initial one-third of the insurance claims payments 54 must be disbursed to the insured within 14 days after the 55 receipt of the insurance claims payment from the policyholder to 56 the mortgagee or assignee. 57 (b) The second one-third of the insurance claims payments 58 must be disbursed to the insured within 14 days after the date 59 of verification that at least 50 percent of the repairs based on 60 the insurance claims payments were completed. The mortgagee, at 61 its own expense, may use an in-person inspector or a 62 photographic submission by the insured to verify that the 63 required threshold of repairs is completed. 64 (c) The final one-third of the insurance claims payments 65 must be disbursed to the insured within 14 days after the date 66 of verification that at least 90 percent of the repairs based on 67 the insurance claims payments were completed. The mortgagee, at 68 its own expense, may use an in-person inspector or a 69 photographic submission by the insured to verify that the 70 required threshold of repairs is completed. 71 (5)(3)Insurance proceeds received by a mortgagee or 72 assignee whichthatrelate to contents insurance coverage in 73 which the mortgagee or assignee does not have a security 74 interest in the contents must be promptly distributed to the 75 insured. 76 (6)(4)Insurance proceeds received by a mortgagee or 77 assignee whichthatrelate to additional living expenses must be 78 promptly distributed to the insured. 79 (7)(5)The mortgagee or assignee is not required to remit 80 the portion of the proceeds relating to additional living 81 expenses and contents insurance if the mortgagee or assignee is 82 not able to determine which part of the proceeds relates to 83 additional living expenses and contents insurance. 84 85 This section may not be construed to prevent an insurance 86 company from paying the insured directly for additional living 87 expenses or paying the insured directly for contents insurance 88 coverage if the mortgagee or assignee does not have a security 89 interest in the contents. 90 Section 2. This act shall take effect July 1, 2019.