This bill enables municipalities in New Jersey to place a lien on the insurance proceeds of properties damaged by fire, provided they adopt an appropriate ordinance. The legislation defines key terms such as "enforcement officer," "final settlement," and "total loss," and establishes the municipality's authority to claim against fire insurance or homeowners insurance proceeds. The lien will prioritize the municipality's claims for costs related to the restoration of the property, including demolition and repairs, over other claims, except for those of mortgagees. The bill also outlines the notification procedures for insurance companies and the conditions under which the lien may expire.

Additionally, the bill requires municipalities to create a mechanism for releasing lien amounts to insured property owners who agree to restore their properties within a specified timeframe. If proof of repairs is not submitted within 120 days, municipalities may retain the insurance proceeds to secure or repair the property in compliance with local codes. Furthermore, the bill mandates that business and rental unit owners maintain liability insurance for fire or explosion damages, with minimum coverage amounts set at $500,000 for businesses and $300,000 for multifamily homes with four or fewer units. The legislation is set to take effect 180 days after enactment.

Statutes affected:
Introduced: 17:36-9, 40A:10A-1