Attorney General Brenna Bird today announced a victory for Iowa homeowners in a case before the U.S. Court of Appeals for the Eighth Circuit. The judge affirmed that Iowa’s laws banning residential contractors from acting as public adjusters are constitutional.
When storm damage hits a home, homeowners often find themselves caught between insurance companies and repair contractors. Iowa passed strict laws to prevent roofers and contractors from “double-dipping” by serving as both the repair contractor and the public adjuster on the same residential real estate project.
Public adjusters are professionals who act for and aid an insured in negotiating or affecting the settlement of a first-party insurance claim. Under Iowa law a public adjuster must be properly licensed.
An Iowa residential contractor, Shamrock Hills, LLC, sued state officials after receiving warning notices for business activities consistent with unlicensed public adjusting. The company alleged that Iowa’s laws violated the First Amendment and were unconstitutionally vague. The Eighth Circuit court largely disagreed, dismissing the challenges.
“Owning a home is a dream for many Iowans, but that dream can turn into a nightmare if they are scammed by people who are supposed to be there to help when their home needs repairs,” said Attorney General Bird. “Iowa’s public adjusting laws are written to protect homeowners. I’m grateful for the Court’s decision. If you suspect you’ve been a victim of contractor or insurance adjuster fraud, contact my office.”
This ruling protects Iowa homeowners in three important ways:
- Eliminates Conflicts of Interest: A contractor who also acts as an insurance negotiator has a direct financial interest in inflating insurance claims to maximize their own repair payout. Keeping those roles separate protects homeowners from predatory practices.
- Prevents Unlicensed Insurance Practices: Adjusting an insurance claim requires specific training and licensure under Iowa law. The ruling prevents contractors from taking over policy negotiations without meeting legal standards.
- Saves Homeowners from Illegal Contracts: Under Iowa law, contracts that violate those rules can result in heavy fines—up to $40,000 per violation—against predatory contractors. The ruling reinforces state enforcement to keep bad actors out of neighborhoods after severe weather.
If you or someone you love has been a victim of contractor or insurance fraud, contact the Attorney General’s Office at 1-515-281-5926 or through the website at iowaattorneygeneral.gov.
Read the full decision here.
