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  which that relate 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 which that relate 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 which that relate 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.