SF 332 (LSB 2271XS (2) 88)

SENATE FILE 332

BY  ZAUN

A BILL FOR

An Act relating to motor vehicle damage repair under motor vehicle insurance policies and deceptive acts or practices by motor vehicle insurers.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 507B.4, subsection 3, paragraph j, Code 2019, is amended by adding the following new subparagraph:
   NEW SUBPARAGRAPH.  (16)  Failing to comply with section 537B.7, subsection 2.
    Sec. 2.  Section 507B.6, subsection 1, Code 2019, is amended to read as follows:
   1.  Whenever the commissioner believes that any person has been engaged or is engaging in this state in any unfair method of competition or any unfair or deceptive act or practice whether or not defined in section 507B.4, 507B.4A, or 507B.5, or 537B.7, and that a proceeding by the commissioner in respect to such method of competition or unfair or deceptive act or practice would be in the public interest, the commissioner shall issue and serve upon such the person a statement of the charges in that respect and a notice of a hearing on such the charges to. The hearing shall be held at a time and place fixed in the notice, which shall not be less than ten days after the date of the service of such the notice.
    Sec. 3.  Section 507B.12, subsection 1, Code 2019, is amended to read as follows:
   1.  The commissioner may, after notice and hearing, promulgate reasonable rules, as are necessary or proper to identify specific methods of competition or acts or practices which are prohibited by section 507B.4, 507B.4A, or 507B.5, or 537B.7, but the rules shall not enlarge upon or extend the provisions of such sections. Such rules shall be subject to review in accordance with chapter 17A.
    Sec. 4.  NEW SECTION.  537B.7  Deceptive act or practice —— insurer.
   1.  As used in this section:
   a.  “Claimant” means a person seeking a repair of a motor vehicle whether that person is the insured person or a third party making a claim against the insurer.
   b.  “Motor vehicle” means the same as defined in section 537B.4.
   c.  “Repair facility” means the same as defined in section 537B.4.
   2.  An insurer, adjuster, appraiser, insurance producer, employee of an insurer, or any other representative of an insurer, shall not, in regard to a repair of damage to a motor vehicle covered by a motor vehicle insurance policy, unilaterally disregard a repair operation or cost identified by an estimating system which the insurer and a repair facility have agreed to use to determine the cost of repair to a claimant’s motor vehicle.
   3.  A violation of this section shall be an unfair or deceptive act or practice in the business of insurance as provide in section 507B.4, subsection 3, paragraph “j”, subparagraph (16).
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill relates to the repair of damage to a motor vehicle covered by a motor vehicle insurance policy and deceptive acts or practices by the insurer of the motor vehicle.
   The bill makes it an unfair or deceptive act or practice in the business of insurance for an insurer, adjuster, appraiser, insurance producer, employee of an insurer, or any other representative of an insurer to unilaterally disregard a repair operation or cost identified by an estimating system which the insurer and a repair facility agreed to use to determine the cost of repairing a claimant’s motor vehicle. 
   “Claimant” is defined in the bill as an insured person, or a third party making a claim against the insurer, seeking a repair of a motor vehicle. “Motor vehicle” and “repair facility” are defined in the bill.
   The bill makes conforming changes to Code sections 507B.6 and 507B.12.