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State of Iowa Cracking Down on Contractors Who Act Improperly on Insurance Claim Projects - April 22, 2020

On April 21, the Iowa Insurance Division ordered residential contractor, 33 Carpenters Construction, Inc. of Bettendorf, to cease and desist from acting as a public adjuster while unlicensed to do so. They are also ordered to pay penalties totaling $15,000 in civil penalties.


Contractors, including storm response contractors and other remodeling companies, who interact with their clients’ property insurers or who otherwise work for homeowners on projects covered by a homeowner insurance claim need to ensure they are not engaging in any actions that could constitute the unlicensed practice of public adjusting.


As noted in two prior posts (Iowa Court of Appeals and Iowa Supreme Court), these contractors need to take a close look at their practices and seek legal advice as necessary regarding changes that need to be made to their job practices, contracts, website, and other marketing materials to comply with Iowa law. This will ensure that neither the Iowa Insurance Division nor any court would find that your actions equate to acting as an unlicensed public adjuster. Actions constituting unlawful public adjusting by contractors include:

  • Acting for, assisting, or aiding an insured in negotiating for or effecting the settlement of the homeowner’s claim with its property insurer
  • Advertising or soliciting business or representing to the public that the person is a public adjuster of claims
  • Directly or indirectly soliciting business investigating or advising an insured about the homeowner’s claim with its property insurer

In 2019, the Iowa legislature passed a new law mandating further restrictions on potential assignment of claims and benefits involving residential contractors.


With the Iowa Insurance Division stepping up enforcement, contractors should take steps to ensure compliance to avoid issues



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