DES MOINES, Iowa - Shops, housing contractors and other business in Iowa that perform insurance claim repairs suddenly have a great deal in common thanks to Iowa Senate File 2326. The bill, which received a 13-0 approval vote from the Senate Commerce Committee on March 5, bars insurance companies from requiring repair businesses to buy supplies or parts from specific suppliers.
Introduced originally as Senate Study Bill 3108 in January, SF2326 adds language to the state's insurance code deeming the following insurer actions as unfair practices: "Requiring a repair business that performs repairs, on behalf of an insurer, to the property of an insured or beneficiary to buy supplies and parts from a seller or list of sellers specified by the insurer."
Persons found guilty of violating the proposed law would be subject to civil penalties assessed by the state insurance commissioner of up to $5,000 for each violation, along with a possible suspension or revocation of their licenses.
To date, lobbyists for the Home Builders Association of Iowa (HBAI) and the Iowa Lumber Association have registered their support. State Farm and the Iowa-Nebraska Farm Equipment Dealers Association have registered their disapproval.
The bill has been placed on the full Senate's calendar.
