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) 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 a municipality that receives notice from an insurer under section 4.5(a) of this chapter certifies to the insurer the amount of demolition or rehabilitation expenses that the municipality anticipates incurring or has incurred under IC 36-7-9 in connection with the building or structure;

the insurer shall remit to the municipality or the enforcement authority the amount determined under subsection (d).

(c) To require the remittance of money under this section, an enforcement authority must:

(1) provide the certification under subsection (b) within fifteen (15) days after the enforcement authority receives notice under section 4.5(a) of this chapter; and

(2) comply with subsection (d).

(d) The amount that must be remitted to the municipality or the enforcement authority under subsection (b) is the lesser of:

(1) ten percent (10%) of the available insurance proceeds, if any;

(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.

(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 municipality. The insured shall be notified by the enforcement authority of the actions taken under this section.

As added by P.L.247-1989, SEC.2. Amended by P.L.123-1992, SEC.2; P.L.238-2013, SEC.8.