Iowa Gov. Kim Reynolds signed a new Senate File 573 into law, establishing new regulations for auto glass repair and insurance claims.
The law introduces rules for fees, repair authorizations, and consumer incentives tied to glass services.
Under the new law, policyholders cannot reassign post-loss benefits, including any rights or duties under their insurance policies. While insurers cannot require policyholders to use specific repair shops, they are allowed to recommend shops and maintain repair networks.
Key Provisions
- Policyholders are prohibited from assigning post-loss benefits, including any rights, duties, or benefits under their insurance policies. This change limits the ability of repair shops to work directly with insurers on behalf of customers.
- Repair shops must inform customers if their vehicle has Advanced Driver Assistance Systems features and whether calibration or recalibration is necessary after a windshield repair or replacement. If the shop cannot perform the calibration, they must advise the customer to seek assistance from a certified dealership or qualified specialist.
- Repair shops are barred from offering gifts, cash, or other incentives to attract customers.
- Shops cannot commence work under first-party insurance policies until a claim has been filed and a claim or referral number is received.
- Shops are required to provide good-faith estimates before starting repairs and must issue itemized invoices upon completion. They are prohibited from charging unreasonable fees, submitting false documentation, or misrepresenting costs.
- While insurers cannot mandate the use of specific repair shops, they may still recommend preferred vendors and maintain repair networks.
Repair shops are now prohibited from offering gifts, cash, or other incentives to attract customers. They must verify that a claim has been filed and obtain a claim or referral number before beginning repairs under a first-party policy.
The law also bans shops from charging excessive fees, submitting false records, misrepresenting costs, or claiming a repair has been approved without insurer confirmation.
Repair facilities are required to provide good-faith estimates before starting any work and must issue itemized invoices once the job is finished.
The legislation originated as a Senate study bill and passed with few changes throughout the legislative process.
The Independent Glass Association (IGA) has expressed strong opposition to the new law, arguing that it favors insurance companies and undermines consumer rights and small business viability.
The IGA contends that the prohibition of AOB and the limitations on consumer incentives disproportionately benefit insurers and restrict consumer choice.
Violations of the new provisions are considered unfair trade practices under Iowa law, subjecting offenders to potential penalties, including fines and license suspension or revocation.
The law applies to insurance policies issued or renewed on or after its effective date.
