South Australian Current Acts South Australian Current Acts109—Insurance by owner of lot
(1) Nothing in this
Act limits the right of the owner of a lot to effect insurance in respect of
the lot.
(2) A contract of
insurance may be entered into by the owner of a lot in respect of damage to
the lot or to a building or other improvement on the lot for an amount equal
to the amount secured at the date of the contract by mortgages over the lot.
(3) Where a contract
of insurance of the kind referred to in subsection (2) is in force—
(a)
payment must be made by the insurer under the contract to the mortgagees whose
interests are noted in the contract in order of their respective priorities,
subject to the terms and conditions of the contract;
(b)
subject to the terms and conditions of the contract, the insurer is liable to
pay under the contract—
(i)
the amount stated in the contract; or
(ii)
the amount of the damage; or
(iii)
the amount sufficient, at the date of the payment, to
discharge the mortgages noted in the contract,
whichever is the least amount.
(4) Where the amount
so paid by the insurer equals the amount necessary to discharge a mortgage
over the lot, the insurer is entitled to an assignment of that mortgage and
where the amount is less than the amount necessary to discharge a mortgage
over the lot, the insurer is entitled to obtain from the mortgagee a transfer
of a proportion of the mortgagee's interest in the mortgage equal to the
proportion that the amount of the payment bears to the amount owing under the
mortgage immediately before the payment.
(5) Money received
under any such contract of insurance is not liable to be brought into
contribution with any other money received under another contract of
insurance, except where the other contract of insurance—
(a) is
in respect of damage to the same lot; and
(b)
relates to the same mortgage debt.