Insurance Loan Claim Agreement

INSURANCE LOAN CLAIM AGREEMENT

This Insurance Loan Claim Agreement (the "Agreement") is made and entered into as of by and between Lender Name: with principal address , and Borrower/Claimant Name: with principal address .

RECITALS

WHEREAS, Borrower has asserted or intends to assert a claim for recovery of insurance proceeds against Insurer: under Policy No.: relating to Claim No.: .

WHEREAS, Lender is willing to make a loan to Borrower in the principal amount set forth below, conditioned upon Borrower assigning to Lender the rights, title and interest in and to the claim and any insurance proceeds recovered in respect thereof, to secure repayment of the loan.

WHEREAS, the parties desire to set forth their respective rights and obligations with respect to the loan, the assignment of the claim, the handling of claim proceeds, and remedies upon default.

NOW, THEREFORE

In consideration of the mutual covenants and agreements contained in this Agreement, the parties agree as follows:

1. DEFINITIONS

1.1 "Loan" means the principal loan made by Lender to Borrower in the amount set forth in Section 2.1. "Claim" means Borrower's claim for insurance proceeds arising from the insured loss described in the recitals. "Proceeds" means any payment made by Insurer in settlement or adjudication of the Claim.

2. LOAN AMOUNT, DISBURSEMENT AND TERMS

2.1 Loan Amount. Lender agrees to advance to Borrower a loan in the principal amount of $ (the "Loan").

2.2 Disbursement. The Loan shall be disbursed to Borrower on or about upon execution of this Agreement and satisfaction of the conditions precedent set forth herein.

2.3 Interest and Repayment. Borrower shall pay interest on the outstanding principal balance at a rate of and shall repay the Loan in full no later than (the "Maturity Date"). All interest shall accrue from the date of disbursement.

3. ASSIGNMENT OF CLAIM AND SECURITY INTEREST

3.1 Assignment. As security for the payment and performance of Borrower's obligations under this Agreement, Borrower hereby absolutely assigns, transfers and conveys to Lender all of Borrower's rights, title and interest in and to the Claim and any Proceeds, including the right to receive payment, to settle, compromise or enforce the Claim, and to pursue any action related thereto.

3.2 Security Interest. Borrower grants Lender a continuing first priority security interest in and to the Claim and Proceeds. Borrower agrees to execute, acknowledge and deliver such financing statements, assignments, or other instruments reasonably requested by Lender to evidence, perfect, or protect Lender's security interest.

4. HANDLING OF CLAIM AND PROCEEDS

4.1 Claim Prosecution. Borrower shall cooperate fully with Lender and shall not settle, release or compromise the Claim without Lender's prior written consent. Lender shall have the right, but not the obligation, to participate in, control, or direct the prosecution, settlement and collection of the Claim.

4.2 Application of Proceeds. All Proceeds received by Borrower or Lender shall be applied first to the Loan (including principal, accrued interest, fees, and costs), and any surplus after repayment to Borrower. Borrower authorizes Insurer to pay Proceeds directly to Lender upon Lender's written demand and proof of leadership's security interest.

5. REPRESENTATIONS AND WARRANTIES

Borrower represents and warrants to Lender as follows:

(a) Borrower is the lawful owner of the Claim and has full power and authority to assign the Claim to Lender free of liens, claims or encumbrances except those disclosed to Lender in writing.

(b) No other person or entity has asserted or perfected a security interest in the Claim, and there are no outstanding assignments, options or agreements that would impair Lender's rights hereunder.

(c) All statements made by Borrower in any proof of loss, claim filing or correspondence with Insurer are true and correct to the best of Borrower's knowledge.

6. COVENANTS

Borrower covenants that, until full payment of the Loan, Borrower shall: (i) not assign, transfer, or encumber the Claim except as permitted by this Agreement; (ii) promptly notify Lender of any communication from Insurer, and (iii) provide Lender copies of all correspondence, proofs of loss, and settlement documents related to the Claim.

7. DEFAULT AND REMEDIES

7.1 Events of Default. The occurrence of any of the following shall constitute an event of default: (a) Borrower's failure to pay principal or interest when due; (b) Borrower's breach of any representation, warranty, or covenant in this Agreement; or (c) any material impairment of Lender's security interest.

7.2 Remedies. Upon an event of default, Lender may, to the fullest extent permitted by law, exercise any rights or remedies available at law or in equity, including but not limited to demanding payment of the Loan, enforcing the assignment, directing Insurer to pay Proceeds to Lender, initiating litigation to collect the Claim or otherwise settling the Claim on Borrower's behalf.

8. INSURER NOTIFICATION AND AUTHORITY

Borrower authorizes Lender to notify Insurer of this Agreement and to demand payment of Proceeds directly to Lender. Borrower further authorizes Lender to receive copies of claim files, proofs of loss, and settlement offers from Insurer.

9. SUBROGATION, RELEASE AND INDEMNIFICATION

9.1 Subrogation. To the extent Lender receives payment of the Loan from Proceeds, Borrower assigns to Lender any rights of subrogation that Borrower acquires against third parties as a result of recovery.

9.2 Indemnification. Borrower shall indemnify, defend and hold Lender harmless from and against any losses, liabilities, costs, and expenses (including reasonable attorneys' fees) arising from Borrower's breach of this Agreement or from any inaccuracy in Borrower's representations or warranties.

10. NOTICES

Notices shall be in writing and shall be deemed given when delivered personally, sent by nationally recognized overnight courier, or mailed by certified mail, return receipt requested, to the addresses set forth above or such other address as a party may designate by notice to the other parties.

11. AMENDMENTS AND WAIVER

No amendment or waiver of any provision of this Agreement shall be effective unless in writing and signed by both parties. No failure or delay by Lender in exercising any right shall operate as a waiver of that right.

12. GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the State of , without regard to conflict of law principles.

13. ENTIRE AGREEMENT; SEVERABILITY

This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings and representations. If any provision of this Agreement is held invalid or unenforceable, such holding shall not affect the remaining provisions, which shall remain in full force and effect.

14. COUNTERPARTS

This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Signatures transmitted by electronic means shall be binding.

15. MISCELLANEOUS

Sign Now