SB-0697, As Passed Senate, March 10, 2016

SUBSTITUTE FOR

SENATE BILL NO. 697

     A bill to amend 1956 PA 218, entitled

"The insurance code of 1956,"

(MCL 500.100 to 500.8302) by adding section 3011.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 3011. (1) Notwithstanding any other provision of this

act, an insurer of a building or other structure or of personal

property located on real property shall not make any further

payments to an insured on a claim of $2,000.00 or more for loss or

damage caused by a fire or explosion to the insured building, other

structure, or personal property if the insurer receives written

notice from the fire or law enforcement authority that the insured

failed or refused to submit the report described in subsection (2)

within 21 days after the insured received a written demand to

provide the report from the fire or law enforcement authority.

Payments to an insured that have been withheld under this section

may resume or commence if the insurer receives a copy of the

requested report signed by the insured or receives notice that the

requested signed report has been submitted to the fire or law

enforcement authority.

     (2) If an insured building or other structure suffers loss or

damage caused by fire or explosion, the insured shall submit to the

fire or law enforcement authority designated by the city, village,

or township a report prescribed by the department in conjunction

with the bureau of fire services created in section 1b of the fire

prevention code, 1941 PA 207, MCL 29.1b, that requires information

concerning the building or structure fire or explosion.

     (3) This section applies only if the fire or law enforcement

authority responsible for investigating the fire or explosion is

located in a city, village, or township described in subsection (7)

and if the city, village, or township, acting under a resolution by

its governing body, notifies the director in writing of both of the

following:

     (a) That the city, village, or township has elected to receive

the reports prepared under subsection (2).

     (b) The name and address of the fire or law enforcement

authority designated by the city, village, or township to receive

reports prepared under subsection (2).

     (4) The director shall prepare and distribute a list of all

cities, villages, and townships that have elected to apply this

section to all insurance companies transacting insurance that

provides coverage for loss by fire to buildings or other structures

in this state.

     (5) A city, village, or township may be added to the list

prepared under subsection (4) by submitting a written request

containing the information required under subsection (3) to the

director. If a written request is received, the director shall

prepare and distribute an amended list indicating the addition. The

addition is effective on the date specified by the director in the

amended list. The director shall notify the city, village,

township, and all insurers that issue policies in this state that

provide coverage for loss by fire to buildings or other structures

of the effective date of an addition, which must be not less than

30 days after receipt of the notice by the insurance company. This

section does not apply to any loss that occurred before the

effective date of the addition.

     (6) A city, village, or township may request to be deleted

from the list prepared under subsection (4) or may cease to apply

this section for a period of not less than 6 months on not less

than 30 days' written notice to the director. After receipt of a

request to be deleted from the list, the director shall prepare and

distribute an amendment to the list indicating the deletion. The

deletion is effective on the date specified by the director in the

amendment. The director shall notify the city, village, township,

and all insurers that issue policies in this state that provide

coverage for loss by fire to buildings or other structures of the

effective date of a deletion, which must be effective not less than

30 days after receipt of the notice by the insurance company. A

city, village, or township shall continue to apply this section to

any loss that occurred before the effective date of the deletion,

notwithstanding the deletion.

     (7) A city, village, or township may elect to apply this

section as provided in subsection (3) and as follows:

     (a) If the city, village, or township is located in a county

with a population of 425,000 or more.

     (b) If the city, village, or township is located in a county

with a population of less than 425,000 and the city, village, or

township has a population of 50,000 or more.

     (8) An insurer or an agent or employee of an insurer is not

liable for damages for withholding money in compliance with this

section.

     Enacting section 1. This amendatory act takes effect 90 days

after the date it is enacted into law.