Bill Text: IN SB0169 | 2013 | Regular Session | Enrolled
Bill Title: Insurance proceeds set aside.
Spectrum: Bipartisan Bill
Status: (Passed) 2013-05-13 - Public Law 238 [SB0169 Detail]
Download: Indiana-2013-SB0169-Enrolled.html
Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is
being amended, the text of the existing provision will appear in this style type, additions
will appear in this style type, and deletions will appear in this style type.
Additions: Whenever a new statutory provision is being enacted (or a new constitutional
provision adopted), the text of the new provision will appear in this style type. Also, the
word NEW will appear in that style type in the introductory clause of each SECTION that
adds a new provision to the Indiana Code or the Indiana Constitution.
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conflicts between statutes enacted by the 2012 Regular Session of the General Assembly.
AN ACT to amend the Indiana Code concerning insurance.
Be it enacted by the General Assembly of the State of Indiana:
SECTION 2. IC 27-2-15-2.5 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]: Sec. 2.5. As used in this chapter, "department" refers to the department of insurance created by IC 27-1-1-1.
SECTION 3. IC 27-2-15-3.2 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]: Sec. 3.2. (a) As used in this chapter, "final settlement" means a determination:
(1) of the amount owed to an insured:
(A) under the building coverage part of an insurance policy issued by an insurer; and
(B) for damage to or loss of a building or other structure caused by fire or explosion; and
(2) made by any of the following means:
(A) Acceptance of a proof of loss by the insurer.
(B) Execution of a release by the named insured.
(C) Acceptance of an arbitration award by the named
insured and the insurer.
(D) Judgment of a court of competent jurisdiction.
(b) The term "final settlement" does not apply to damage or loss
related to contents, personal property, or another loss that is not
covered under the building coverage part of an insurance policy.
SECTION 4. IC 27-2-15-4.2 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2013]: Sec. 4.2. As used in this chapter, "municipality" has the
meaning set forth in IC 36-1-2-11.
SECTION 5. IC 27-2-15-4.3 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2013]: Sec. 4.3. (a) This chapter applies to damage to or loss of
a building or structure caused by fire or explosion only if all of the
following are true:
(1) The municipality in which the building or structure is
located is included on the list maintained by the department
under section 4.4(b) of this chapter.
(2) The fire or explosion occurs on or after the effective date
specified by the department for the municipality under section
4.4(b) of this chapter.
(3) The amount of the final settlement concerning the damage
or loss exceeds seventy-five percent (75%) of available
insurance proceeds.
(4) If the insurer, in good faith, withheld payment under an
insurance policy due to:
(A) suspected arson;
(B) suspected fraud; or
(C) another question concerning coverage;
the reason for withholding payment has been resolved and
final settlement concerning the damage or loss has occurred.
SECTION 6. IC 27-2-15-4.4 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2013]: Sec. 4.4. (a) A municipality may elect to be governed by
this chapter by submitting to the department a written request.
The request must:
(1) be approved by adoption of an ordinance by the
municipality's legislative body; and
(2) contain contact information for the specific individual who
will act on behalf of the enforcement authority with respect to
this chapter.
(b) The department shall:
(1) maintain a list of all municipalities that submit a request
under subsection (a), including the contact information
required by subsection (a)(2);
(2) specify the effective date of each addition of a municipality
to the list; and
(3) publish the list on an Internet web site.
(c) A municipality that made an election under subsection (a)
may elect to cease being governed by this chapter and may be
removed from the list maintained under subsection (b) as follows:
(1) The municipality shall submit to the department a written
request, approved by adoption of an ordinance by the
municipality's legislative body, to cease being governed by
this chapter and to be removed from the list.
(2) The department shall:
(A) amend the list by removing the municipality;
(B) specify on the amended list the effective date of the
municipality's removal from the list; and
(C) publish the amended list on the Internet web site
described in subsection (b)(3).
(d) A municipality that is governed by this chapter shall remit
to the department a one (1) time fee of one hundred dollars ($100).
SECTION 7. IC 27-2-15-4.5, AS AMENDED BY P.L.119-2012,
SECTION 159, IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2013]: Sec. 4.5. (a) As used in this section,
"city" refers to either of the following:
(1) A city having a population of more than eighty thousand
(80,000) but less than eighty thousand four hundred (80,400).
(2) A city having a population of more than eighty thousand five
hundred (80,500) but less than one hundred thousand (100,000).
(b) (a) An insurer that:
(1) issued an insurance policy covering that:
(A) covers a building or other structure that is:
(1) (i) located in a city; municipality governed by this
chapter; and
(2) (ii) damaged by a fire or explosion; and
(B) is in effect at the time that the fire or explosion occurs;
and
(2) receives notice of a claim for the damage by the named
insured;
shall, not more than fifteen (15) days after a final settlement is
reached, notify the enforcement authority of the city municipality
about the existence of the policy. However, an insurer is not required
to notify the enforcement authority under this section if the policy
issued by the insurer is not in effect at the time of the fire or explosion
that damages the building or structure.
(c) The insurer shall provide the notice required under this section
if the enforcement authority makes a request for the notice within
twenty (20) days after the damage occurs.
(d) (b) The notice to an enforcement authority required by this
section subsection (a) must:
(1) be in writing;
(2) identify the insurer and state the insurer's address; and
(3) identify the building or structure and state the location of the
building or structure. and
(4) disclose the nature and extent of the coverage of the building
or structure provided by the policy.
(e) An insurer shall provide notice to the enforcement authority
under this section within ten (10) days after the insurer is notified
under subsection (c) of the damaging of the building or structure by fire
or explosion.
(f) (c) The commissioner may take action under IC 27-1-3-10 and
IC 27-1-3-19 against an insurer that violates this section.
SECTION 8. IC 27-2-15-5 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2013]: Sec. 5. (a) This section does
not apply to damage or loss to a building or structure described in
section 4.5 of this chapter if:
(1) a fire or explosion damages a building or other structure
located in a city; and
(2) (1) not more than fifteen (15) days after final settlement
has occurred concerning the building or structure, the named
insured files with the insurer evidence of a contract to repair
the building or structure; and
(2) upon receipt of the evidence of a contract to repair, the
insurer notifies the municipality that this section does not
apply due to the existence of the evidence.
(b) If:
(1) the requirements of subsection (a) are not met; and
(2) the enforcement authority of the city a municipality that
receives notice from an insurer under section 4.5(a) of this
chapter certifies to an the insurer that issued a policy covering
the building or structure the amount of demolition or
rehabilitation expenses that the city municipality anticipates
incurring or has incurred under IC 36-7-9 in connection with the
building or structure;
the insurer shall remit to the city municipality or the enforcement
authority the amount determined under subsection (c). (d).
(b) (c) To require the remittance of money under this section, an
enforcement authority must:
(1) provide the certification under subsection (a) (b) within thirty
(30) fifteen (15) days after the fire or explosion that damages the
building or structure; enforcement authority receives notice
under section 4.5(a) of this chapter; and
(2) comply with subsection (c). (d).
However,it is not necessary for the enforcement authority to provide
the certification within thirty (30) days after the fire or explosion if the
insurer fails to provide notice to the enforcement authority under
section 4.5 of this chapter within ten (10) days after the fire or
explosion.
(c) (d) The amount that must be remitted to the city municipality
or the enforcement agency authority under subsection (a) (b) is the
lesser of:
(1) fifteen ten percent (15%) (10%) of the available insurance
proceeds, if any; or
(2) an amount equal to the amount certified; or
(3) the following:
(A) Seven thousand dollars ($7,000) for a residential
building or structure.
(B) Fifteen thousand dollars ($15,000) for a nonresidential
building or structure.
For purposes of this subsection, "a residential building or
structure" means real property consisting of not more than four
(4) residential units, one (1) of which is the principal place of
residence of the named insured.
(d) (e) The amount remitted under this section shall be placed by
the enforcement authority in an interest bearing escrow account to be
administered by the enforcement authority and the city. municipality.
The insured shall be notified by the enforcement authority of the
actions taken under this section.
SECTION 9. IC 27-2-15-6 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2013]: Sec. 6. (a) Upon a judgment
being rendered under IC 36-7-9-13(c) or IC 36-7-9-13(d), the city
municipality is entitled to the available insurance proceeds set aside
only:
(1) to the extent of the costs set forth in IC 36-7-9-12; and
(2) for demolition and rehabilitation expenses certified under section 5(b) of this chapter.
Available insurance proceeds set aside under section 5 of this chapter may not be used to pay the costs of fire service, police service, or any other service provided in the normal course of the municipality's business.
(b) All claims by the
SECTION 10. IC 27-2-15-9 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]: Sec. 9. The department, the commissioner and employees of the department, the state fire marshal, a deputy fire marshal, an enforcement authority, or an officer of a
SECTION 11. IC 27-2-15-11 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]: Sec. 11. (a) The definitions in IC 36-1-2 apply throughout this section.
(b) As used in this section, "third class city" means a third class city as classified under IC 36-4-1-1.
(c) The amendments to this chapter made by SEA 169-2013 apply as follows:
(1) After June 30, 2013, only to third class cities.
(2) After June 30, 2014, only to towns and third class cities.
(3) After June 30, 2015, to all municipalities.
(d) Before the date that applies to a municipality under subsection (c), the law that applies to the municipality is this chapter as if it had not been amended by SEA 169-2013.
(e) This section expires July 1, 2015.
SECTION 12. IC 34-30-2-111 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]: Sec. 111. IC 27-2-15-9 (Concerning the department of insurance, the commissioners and employees of the department of insurance, the state fire marshal, a deputy fire marshal, an enforcement authority, or an officer of a
of insurance proceeds in arson cases).
SEA 169
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