USA – IOWA Trends and Developments Contributed by: Benjamin J. Kenkel, Sean M. O’Brien and Blake R. Hanson, Dickinson, Bradshaw, Fowler & Hagen, P.C.
ance claims. The Insured Homeowner’s Protection Act, codified at Iowa Code § 515.137A, regulates post- loss assignments by which homeowners transfer their property insurance claim rights to residential contrac- tors for repair or reconstruction work after a covered loss. The Iowa legislature enacted this statute in 2019 and most recently amended it effective 1 July 2025. The statute prohibits residential contractors operating under a post-loss assignment from rebating insurance deductibles, charging administrative fees for cancella- tion or check processing, acting as unlicensed public adjusters, or receiving insurance payments unrelated to the actual repair work. It also imposes disclosure requirements and creates cancellation rights. Licensing and regulation of insurance appraisers and umpires Property insurance policies typically include a pro- vision allowing either the insured or the insurer to demand appraisal if a dispute arises concerning the amount of the loss. In the event of an appraisal, each side designates an appraiser. If the appraisers cannot agree on the amount of the loss, they select and sub- mit their differences to an umpire. Appraisal provisions typically do not specify procedures for conducting the appraisal, and there is a relative dearth of Iowa case law on the topic. This can result in unresolved dis- putes and delays. The Iowa legislature responded in 2025 by enacting Iowa Code Chapter 522F, titled “Licensing and Reg- ulation of Appraisers and Umpires”. The Act estab- lishes a comprehensive regulatory framework for insurance appraisers and umpires who participate in property insurance claim disputes in Iowa. Appraisers and umpires must apply for a licence, pass a written examination, and have at least three years of relevant professional experience in fields such as engineering, architecture, insurance claims adjusting, or construc- tion. Both appraisers and umpires must act with due diligence, disclose and withdraw from conflicts of interest, avoid ex parte communications, and exercise independent judgment. Neither may serve in dual roles, such as both adjuster and appraiser, on the same claim. The Act establishes a procedure for resolving umpire selection disputes. The insured and insurer have a right to raise a “good cause” objection to the umpire
selected by the appraisers. Good cause means a legally sufficient reason such as a conflict of interest, lack of independence or competency, or other rea- son that would reasonably be expected to impair the appraisal. If the appraisers cannot agree on an umpire, the Iowa Insurance Division will randomly select one from its list of licensed umpires. Either appraiser can request judicial review, but the judge shall give defer- ence to the umpire randomly selected by the Division. The Act also imposes specific deadlines: 20 days to select appraisers, 15 days to agree on an umpire, 45 days for appraisers to submit findings, and 45 days for the umpire to issue a written itemised award. Unless otherwise agreed, the appraisal award is binding and must be paid within 60 calendar days, subject to policy limits and deductibles. Insurers may move to vacate for good cause within 30 days. Although the Act does not address the standard of review, Iowa case law holds a court will overturn an appraisal award only upon a showing of fraud, misfeasance, or mistake. All property insurance policies delivered or renewed in Iowa on or after 1 January 2026 must contain an appraisal clause complying with the chapter. Post-derecho insurance claims – bulletin from the Commissioner The Iowa Insurance Commissioner issued several bulletins over the years addressing insurance cover- age for catastrophic weather events. On 3 July 2024, the Commissioner used Bulletin 2024-3 to officially rescind Bulletins 19-04 (regarding insurance consum- ers impacted by severe weather and natural disasters (dated 17 June 2019)) and 21-04 (regarding derecho damage deadlines (dated 26 June 2021)). The Com- missioner wrote that the new bulletin’s purpose “is to provide ongoing guidance to individuals and entities regulated by the Iowa Insurance Commissioner when severe weather and natural disasters impact Iowa consumers”. The Commissioner further provided that the “intent of this bulletin is not to have a specific expiration date but to provide guidance so whenever a state disaster proclamation is issued by the Governor, producers and insurers have guidance on actions they should be taking”. Perhaps most notable is the 2024-3 Bulletin’s pur- ported relaxing of recoverable depreciation deadlines.
321 I NSURANCE L I T IGATI O N 2026
CHAMBERS.COM
Powered by FlippingBook