Bill Text: IA HSB33 | 2019-2020 | 88th General Assembly | Introduced
Bill Title: A bill for an act relating to residential contractors and repair or services performed on residential real estate covered by property and casualty insurance, and making penalties applicable.
Spectrum: Committee Bill
Status: (N/A - Dead) 2019-02-13 - Committee report, recommending amendment and passage. H.J. 290. [HSB33 Detail]
Download: Iowa-2019-HSB33-Introduced.html
House
Study
Bill
33
-
Introduced
HOUSE
FILE
_____
BY
(PROPOSED
COMMITTEE
ON
COMMERCE
BILL
BY
CHAIRPERSON
CARLSON)
A
BILL
FOR
An
Act
relating
to
residential
contractors
and
repair
or
1
services
performed
on
residential
real
estate
covered
2
by
property
and
casualty
insurance,
and
making
penalties
3
applicable.
4
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
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Section
1.
Section
103A.71,
Code
2019,
is
amended
to
read
1
as
follows:
2
103A.71
Residential
contractors.
3
1.
This
section
may
be
cited
as
the
“Insured
Homeowner’s
4
Protection
Act”
.
5
1.
2.
As
used
in
this
section
,
unless
the
context
otherwise
6
requires
:
7
a.
“Catastrophe”
means
a
natural
occurrence
including
but
8
not
limited
to
fire,
earthquake,
tornado,
windstorm,
flood,
or
9
hail
storm,
which
damages
or
destroys
residential
real
estate.
10
b.
a.
“Residential
contractor”
means
a
person
in
the
11
business
of
contracting
to
repair
or
replace
residential
12
roof
systems
or
perform
any
other
exterior
repair,
exterior
13
replacement,
or
exterior
reconstruction
work
resulting
from
a
14
catastrophe
on
residential
real
estate
or
a
person
or
offering
15
to
contract
with
an
owner
or
possessor
of
residential
real
16
estate
to
carry
out
such
work.
do
any
of
the
following:
17
(1)
Repair
or
replace
a
roof
system
or
perform
any
other
18
exterior
repair,
replacement,
construction,
or
reconstruction
19
work
on
residential
real
estate.
20
(2)
Perform
interior
or
exterior
cleanup
services
on
21
residential
real
estate.
22
(3)
Arrange
for,
manage,
or
process
the
work
referred
to
in
23
subparagraph
(1)
or
(2).
24
(4)
Serve
as
a
representative,
agent,
or
assignee
of
the
25
owner
or
possessor
of
residential
real
estate.
26
c.
b.
“Residential
real
estate”
means
a
new
or
existing
27
building,
including
a
detached
garage,
constructed
for
28
habitation
by
one
to
four
families.
29
d.
c.
“Roof
system”
means
and
includes
roof
coverings,
roof
30
sheathing,
roof
weatherproofing,
and
roof
insulation.
31
2.
3.
A
residential
contractor
shall
not
advertise
or
32
promise
to
rebate
any
insurance
deductible
or
any
portion
33
thereof
as
an
inducement
to
the
sale
of
goods
or
services.
A
34
promise
to
rebate
any
insurance
deductible
includes
granting
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any
allowance
or
offering
any
discount
against
the
fees
to
be
1
charged
or
paying
a
person
directly
or
indirectly
associated
2
with
the
residential
real
estate
any
form
of
compensation,
3
except
for
items
of
nominal
value.
A
residential
contractor
4
may
display
a
sign
or
any
other
type
of
advertisement
on
a
5
person’s
premises
provided
the
person
consents
to
the
display
6
and
the
person
receives
no
compensation
from
the
residential
7
contractor
for
the
placement
of
the
sign
or
advertising.
8
3.
4.
A
residential
contractor
shall
not
represent
or
9
negotiate
on
behalf
of,
or
offer
or
advertise
to
represent
or
10
negotiate
on
behalf
of,
an
owner
or
possessor
of
residential
11
real
estate
on
any
insurance
claim
in
connection
with
the
12
repair
or
replacement
of
a
roof
systems
system
,
or
the
13
performance
of
any
other
exterior
repair,
exterior
replacement,
14
or
exterior
reconstruction
work
on
the
residential
real
estate.
15
4.
a.
A
residential
contractor
contracting
to
provide
16
goods
or
services
to
repair
damage
resulting
from
a
catastrophe
17
shall
provide
the
person
with
whom
it
is
contracting
a
fully
18
completed
duplicate
notice
in
at
least
ten-point
bold
type
19
which
shall
contain
the
following
statement:
20
NOTICE
OF
CONTRACT
OBLIGATIONS
AND
RIGHTS
21
You
may
be
responsible
for
payment
to
(insert
name
of
22
residential
contractor)
for
the
cost
of
all
goods
and
services
23
provided
whether
or
not
you
receive
payment
from
any
property
24
and
casualty
insurance
policy
with
respect
to
the
damage.
25
Pursuant
to
Iowa
law
your
contract
with
(insert
name
of
26
residential
contractor)
to
provide
goods
and
services
to
27
repair
damage
resulting
from
a
naturally
occurring
catastrophe
28
including
but
not
limited
to
a
fire,
earthquake,
tornado,
29
windstorm,
flood,
or
hail
storm
is
void
and
you
have
no
30
responsibility
for
payment
under
the
contract
if
(insert
name
31
of
residential
contractor)
either
advertises
or
promises
to
32
rebate
all
or
any
portion
of
your
insurance
deductible,
or
33
represents
or
negotiates,
or
offers
to
represent
or
negotiate,
34
on
your
behalf
with
your
property
and
casualty
insurance
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company
on
any
insurance
claim
relating
to
the
damage
you
have
1
contracted
to
have
repaired.
Your
signature
below
acknowledges
2
your
understanding
of
these
legal
obligations
and
rights.
3
...........
4
Date
5
...........
6
Signature
7
b.
The
notice
shall
be
executed
by
the
person
with
8
whom
the
residential
contractor
is
contracting
prior
to
or
9
contemporaneously
with
entering
into
the
contract.
10
5.
A
post-loss
assignment
by
a
named
insured
of
rights
11
or
benefits
to
a
residential
contractor
under
a
property
and
12
casualty
insurance
policy
insuring
residential
real
estate
13
shall
be
subject
to
all
of
the
following
requirements:
14
a.
The
assignment
shall
only
authorize
a
residential
15
contractor
to
be
named
as
a
co-payee
for
the
payment
of
16
benefits
under
a
property
and
casualty
insurance
policy
17
covering
residential
real
estate.
18
b.
The
assignment
shall
include
all
of
the
following:
19
(1)
An
itemized
description
of
the
work
to
be
performed.
20
(2)
An
itemized
description
of
the
materials,
labor,
and
21
fees
for
the
work
to
be
performed.
22
(3)
A
total
itemized
amount
to
be
paid
for
the
work
to
be
23
performed.
24
c.
The
assignment
shall
include
a
statement
that
the
25
residential
contractor
has
made
no
assurances
that
the
claimed
26
loss
will
be
fully
covered
by
an
insurance
contract
and
shall
27
include
the
following
notice
in
capitalized
fourteen
point
28
type:
29
YOU
ARE
AGREEING
TO
GIVE
UP
CERTAIN
RIGHTS
YOU
HAVE
UNDER
30
YOUR
INSURANCE
POLICY.
PLEASE
READ
AND
UNDERSTAND
THIS
31
DOCUMENT
BEFORE
SIGNING.
32
THE
ITEMIZED
DESCRIPTION
OF
THE
WORK
TO
BE
DONE
SHOWN
IN
THIS
33
ASSIGNMENT
FORM
HAS
NOT
BEEN
AGREED
TO
BY
THE
INSURER.
THE
34
INSURER
HAS
THE
RIGHT
TO
PAY
ONLY
FOR
THE
COST
TO
REPAIR
OR
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REPLACE
DAMAGED
PROPERTY
CAUSED
BY
A
COVERED
PERIL.
1
d.
The
assignment
shall
not
impair
the
interest
of
a
2
mortgagee
listed
on
the
declarations
page
of
the
property
3
and
casualty
insurance
policy
which
is
the
subject
of
the
4
assignment.
5
e.
The
assignment
shall
not
prevent
or
inhibit
an
insurer
6
from
communicating
with
the
named
insured
or
mortgagee
listed
7
on
the
declarations
page
of
the
property
and
casualty
insurance
8
policy
that
is
the
subject
of
the
assignment.
9
f.
A
copy
of
the
executed
assignment
shall
be
provided
to
10
the
insurer
of
the
residential
real
estate
within
five
business
11
days
after
execution
of
the
assignment.
12
g.
The
named
insured
has
the
right
to
cancel
the
assignment
13
for
any
reason
within
five
business
days
from
the
date
the
14
assignment
is
executed.
The
cancellation
must
be
made
in
15
writing.
Within
ten
business
days
of
the
date
of
the
written
16
cancellation,
the
residential
contractor
shall
tender
to
the
17
named
insured,
the
land
owner,
or
the
possessor
of
the
real
18
estate,
any
payments,
partial
payments,
or
deposits
that
have
19
been
made
by
such
person.
20
6.
Any
written
contract,
repair
estimate,
or
work
order
21
prepared
by
a
residential
contractor
to
provide
goods
or
22
services
to
be
paid
from
the
proceeds
of
a
property
and
23
casualty
insurance
policy
shall
include
the
following
notice
24
in
capitalized
fourteen
point
type,
which
shall
be
signed
by
25
the
named
insured,
and
sent
to
the
named
insured’s
insurance
26
company
prior
to
payment
of
proceeds
under
the
applicable
27
insurance
policy:
28
IT
IS
A
VIOLATION
OF
THE
INSURANCE
LAWS
OF
IOWA
TO
REBATE
29
ANY
PORTION
OF
AN
INSURANCE
DEDUCTIBLE
AS
AN
INDUCEMENT
TO
THE
30
INSURED
TO
ACCEPT
A
RESIDENTIAL
CONTRACTOR’S
PROPOSAL
TO
REPAIR
31
DAMAGED
PROPERTY.
REBATE
OF
A
DEDUCTIBLE
INCLUDES
GRANTING
32
ANY
ALLOWANCE
OR
OFFERING
ANY
DISCOUNT
AGAINST
THE
FEES
TO
33
BE
CHARGED
FOR
WORK
TO
BE
PERFORMED
OR
PAYING
THE
INSURED
34
POLICYHOLDER
THE
DEDUCTIBLE
AMOUNT
SET
FORTH
IN
THE
INSURANCE
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POLICY.
THE
INSURED
POLICYHOLDER
IS
PERSONALLY
RESPONSIBLE
FOR
1
PAYMENT
OF
THE
DEDUCTIBLE.
2
5.
7.
A
contract
entered
into
with
a
residential
contractor
3
is
void
if
the
residential
contractor
violates
subsection
2
,
3
,
4
or
4
any
provision
of
this
section
.
5
6.
8.
a.
A
residential
contractor
violating
this
section
6
is
subject
to
the
penalties
and
remedies
prescribed
by
this
7
chapter
.
8
b.
A
violation
of
subsection
2
3
or
3
4
by
a
residential
9
contractor
is
an
unlawful
practice
pursuant
to
section
714.16
.
10
EXPLANATION
11
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
12
the
explanation’s
substance
by
the
members
of
the
general
assembly.
13
This
bill
relates
to
residential
contractors
and
repair
14
or
services
performed
on
residential
real
estate
covered
by
15
property
and
casualty
insurance.
16
Current
law
requires
a
residential
contractor
contracting
to
17
provide
goods
or
services
on
residential
real
estate
to
provide
18
notice
to
the
person
with
whom
they
are
contracting
that
such
19
person
will
be
responsible
for
the
cost
of
all
goods
and
20
services
provided,
regardless
if
the
person
receives
payment
21
from
any
property
and
casualty
insurance.
The
notice
must
also
22
provide
that
the
contract
is
void
if
the
contractor
promises
23
to
rebate
any
portion
of
the
person’s
insurance
deductible,
or
24
negotiates,
or
offers
to
negotiate,
with
the
person’s
insurance
25
company.
26
The
bill
requires
that
the
notification
prohibiting
a
27
contractor’s
rebate
of
a
deductible
be
included
in
any
written
28
contract,
repair
estimate,
or
work
order,
and
be
signed
by
the
29
named
insured.
A
copy
of
such
notification
must
be
sent
to
the
30
named
insured’s
insurer
prior
to
the
payment
of
any
proceeds
31
under
the
applicable
insurance
policy.
32
The
bill
requires
a
notice
regarding
responsibility
for
the
33
cost
of
all
goods
and
services
be
included
in
any
post-loss
34
assignment
of
rights
and
benefits
by
a
named
insured
to
a
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residential
contractor
under
a
property
and
casualty
insurance
1
policy
that
covers
residential
real
estate.
The
assignment
2
must
also
include
an
itemized
description
of
the
work
to
be
3
performed,
and
of
the
cost
of
the
materials,
labor,
and
fees
4
for
the
goods
or
services
to
be
provided.
5
A
copy
of
the
assignment
must
be
provided
to
the
insurer
6
within
five
business
days
after
execution.
The
assignment
7
cannot
prevent
the
insurer
from
communicating
with
the
8
named
insured
or
mortgagee
listed
on
the
declarations
page
9
of
the
policy
that
is
the
subject
of
the
assignment.
The
10
named
insured
can
cancel
the
assignment
for
any
reason
11
within
five
business
days
from
the
date
of
execution
of
the
12
assignment.
Within
10
business
days
of
the
date
of
the
written
13
cancellation,
the
residential
contractor
must
return
to
the
14
named
insured,
the
owner,
or
the
possessor
of
the
residential
15
real
estate,
any
payments
or
deposits
that
have
been
made
by
16
such
person.
17
A
residential
contractor
who
violates
a
provision
of
the
18
bill
is
subject
to
penalties
and
remedies
pursuant
to
Code
19
chapter
103A.
In
addition,
a
contractor
who
advertises
a
20
rebate
or
promises
to
rebate
a
named
insured’s
deductible
to
21
induce
a
sale,
or
represents
or
negotiates
with
an
insurer
22
on
behalf
of
a
named
insured,
commits
a
consumer
fraud
and
23
is
subject
to
criminal
and
civil
penalties
pursuant
to
Code
24
section
714.16.
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