515.139 - DEMOLITION RESERVE ON FIRE AND CASUALTY CLAIMS ON PROPERTY.
515.139 DEMOLITION RESERVE ON FIRE AND CASUALTY CLAIMS ON PROPERTY. 1. An insurer shall reserve ten thousand dollars or ten percent, whichever amount is greater, of the payment for damages to the property excluding personal property on which the insurer has issued a fire and casualty insurance policy as demolition cost reserve if the following are applicable: a. The property is located within the corporate limits of a city. b. The damage to the property renders it uninhabitable or unfit for the purpose for which it was intended, without repair. c. Proof of loss has been submitted by the policyholder for a sum in excess of seventy-five percent of the face value of the policy covering the building or other insured structure. 2. An insurer which has received a proof of loss in excess of seventy-five percent of the face value of the policy covering a building or other insured structure, shall notify the city council of the city within which the property is located. The notice shall be made by certified mail within five working days after receipt of the proof of loss. 3. The city shall release all interest in the demolition cost reserve within one hundred eighty days after receiving notice of the existence of the demolition cost reserve unless the city has instituted legal proceedings for the demolition of the building or other insured structure, and has notified the insurer in writing of the institution of the legal proceedings. Failure of the city to notify the insurer of the legal proceedings terminates the city's claim to any proceeds from the reserve. 4. A reserve for demolition costs is no longer required if either of the following is true: a. The insurer has received notice from both the insured and the city council that the insured has completed repairs to the property or has completed demolition of the property in compliance with all applicable statutes and local ordinances. b. The city has failed to notify the insurer as provided under subsection 3. 5. If the city has instituted legal proceedings, undertaken emergency action, or is required to demolish the damaged property at city expense, the city shall present to the insurer costs incurred, since the date of the fire or other occurrence, including but not limited to legal costs, engineering costs, and demolition costs related directly to the enforcement of any local ordinance, and the insurer shall compensate the city for the incurred costs up to the amount in the demolition cost reserve. Any amount left from the demolition cost reserve after the cost of demolition of the property is paid to the city shall be paid to the insured if the insured is entitled to the remaining proceeds under the policy. 6. The insurer is not liable for any amount in excess of the limits of liability set out by the policy. 7. Insurers complying with this section or attempting in good faith to comply with this section shall be immune from civil and criminal liability.
Section History: Recent Form 88 Acts, ch 1176, §1 C89, § 515.150 89 Acts, ch 16, §1; 91 Acts, ch 59, §1; 92 Acts, ch 1163, § 100; 2007 Acts, ch 152, § 50 CS2007, § 515.139
Footnotes Former § 515.139 transferred to § 515.111; 2007 Acts, ch 152, § 45