1. This section may be cited as the “Insured Homeowner’s Protection Act”. 2. As used in this section, unless the context otherwise requires: a. “Catastrophe” means the same as defined in section 103A.71. b. “Catastrophic disaster” includes a major disaster declaration by the president of the United States or a state of disaster emergency proclamation by the governor. c. “Consumeradvocate” means a consumer advocate appointed pursuant to section 505.8, subsection 6, paragraph “b”,subparagraph (1). d. “Post-loss assignment” means any instrument by which post-loss benefits, rights, or duties of a named insured under a residential property and casualty insurance policy are assigned or transferred to a residential contractor. The post-loss assignment must only assign the insurance proceeds a named insured isentitled to receive from the named insured’s insurer for the repair, replacement construction, or reconstruction of the named insured’s property. e. “Residential contractor” means the same as defined insection 103A.71. f. “Residential real estate” means the same as defined in section 103A.71. g. “Roof system” means the same as defined in section 103A.71. 3. A residential contractor shallbe prohibited from allof the following under a post-loss assignment by a named insured to the residential contractor: a. Rebating or offering torebate any portion of the named insured’s insurance deductible as an inducement for the named insured to purchase a good or service. b. Imposing an administrative fee on the named insured for canceling the post-loss assignment, or imposing a fee to process the insurance check or to interact with the named insured’s mortgage company. c. Acting as a public adjuster without being licensed under chapter 522C. d. Receiving payments from the named insured’s insurer that are unrelated to the repair,replacement construction, or reconstruction work on the covered insured’s property, including but not limited to all of the following: (1) Additional living expenses. (2) Loss of use. (3) Loss of business income. 4. a. A post-loss assignment must include allof the following: (1) An itemized description of the work to be performed. (2) An itemized description ofthe materials, labor,and fees for the work tobe performed. (3) A totalitemized amount to be paid for the work to be performed. (4) A statement that the residential contractor has made no assurances that the claimed loss willbe fully covered by the named insured’s insurance contract and shall include the following notice in capitalized fourteen point type: WITH THE DIVISION ON THE DIVISION’S INTERNET SITE AT IID.IOWA.GOV OR CALL THE DIVISION AT (877) 955-1212. (5) In capitalized fourteen point type and located inthe immediate proximity of the space reserved inthe assignment forthe signature of the named insured, the following notice: ANY REASON WITHOUT PENALTY WITHIN FIVE (5) BUSINESS BE POSTMARKED BEFORE THE FIVE (5) BUSINESS DAY TO (name and address of residential contractor as provided by the residential contractor). IF THE ASSIGNEE HAS NOT BEGUN PENALTY AFTER AT LEAST THIRTY (30) CALENDAR DAYS TO COMMENCE, OR AFTER AT LEAST THIRTY (30) CALENDAR RESIDENTIAL CONTRACTOR HAS UP TO TEN (10) BUSINESS (6) A provision that requires the assignee to indemnify and hold harmless the assignor from liabilities,damages, losses, and costs,including but not limited toattorney fees related tothe lossclaim. b. A post-loss assignment shall not impair the interest of a mortgagee listed on the declarations page of the property and casualty insurance policy that is the subject of the post-loss assignment. All mortgagees shall be named as a co-payee for the payment of benefits under a property and casualty insurance policy covering residential real estate. c. A post-loss assignment shall only authorize a residential contractor to be named as a co-payee, along with thenamedinsured and allmortgagees, for the paymentof benefitsunder aproperty and casualty insurance policy covering residential real estate. d. A post-loss assignment shallnot prevent or inhibitan insurer from communicating with thenamed insuredoramortgagee listedon the declarations page ofthe propertyandcasualty insurance policy that isthe subject of the post-loss assignment. e. An electronic copy of the fullyexecuted post-loss assignment shall be provided to the insurer of the residential realestate, the named insured, and allmortgagees ofthe damaged residential realestate within five business days after execution of the post-loss assignment. A paper copy shall be provided to the insurer,a named insured, and any mortgagee of the damaged residential real estate within five business days of a request by the insurer, the named insured, or a mortgagee. f. A residential contractor named in a post-loss assignment must cooperate with the insurer of the damaged residential real estate in a claim investigation by providing documents and records requested by the insurer and complying with each post-loss duty included in the named insured’s insurance policy. 5. a. A named insured shall have the right to cancel a post-loss assignment without penalty or fee under allof the following circumstances: (1) For any reason within fivebusiness days from the date on which the named insured receives a copy of the fullyexecuted post-loss agreement. (2) The assignee has not substantially performed work on the property thatis the subject ofthe post-loss assignment atleast thirty calendar days after the date work on the property was scheduled to commence. (3) The assignee has not begun substantial work on the property that isthe subject of the post-loss assignment atleast thirty calendar days afterthe date the insured received a fully executed copy of the executed post-loss assignment and the post-loss assignment does not contain a commencement date. b. The cancellation shall be made in writing. Within ten business days of the date of the written cancellation, the residential contractor shall tender to the named insured, the landowner, or the possessor of the real estate, all payments, partial payments, or deposits that have been made by such person. 6. Any written contract, repair estimate, or work order prepared by a residential contractor to provide goods or services to be paid from the proceeds of a property and casualty insurance policy pursuant to a post-loss assignment shall include, in capitalized fourteen point type, the notice as provided in section 103A.71, subsection 4, paragraph “a”, which shall be signed by the named insured, and sent to the named insured’s insurer prior to payment to the residential contractor of proceeds under the applicable insurance policy. 7. For a minimum of seventy-two hours following a catastrophic disaster, a residential contractor shall not enter into a contract with an insured that includes a post-loss assignment. Ifthe commissioner deems the severity of the catastrophic disaster to have placed people under duress, the commissioner shall immediately dispatch the consumer advocate and other personnel to the disaster area to provide consumer guidance. If,after a public hearing, the commissioner determines that, due to the scope and severity of the catastrophic disaster, additional time is necessary to safely deploy additional consumer protection resources, the commissioner may extend the time period that a residential contractor shall not enter into a contract with an insured that includes a post-loss assignment for an additional seventy-two hours. 8. A post-loss assignment entered into with a residential contractor shall be void ifthe residential contractor violates this section. 9. A violation of this section by a residential contractor shall be an unfair practicepursuant to chapter 507B. 10. Ifany provision ofthis sectionor the application thereofto any personorcircumstance isheld invalid, the invalidity does not affect other provisions or applications of this section which can be given effect without the invalid provision or application, and to this end the provisions of this section are severable. Subsection2,NEW paragraphsb–dand formerparagraphsb– dredesignatedase–g Subsections3–5strickenandrewritten NEW subsections6–10
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