The Iowa Supreme Court handed down the case of 33 Carpenters v. State Farm Fire and Casualty Company (https://www.iowacourts.gov/iowa-courts/supreme-court/supreme-court-opinions/case/18-1354), holding that an assignment 33 had obtained from the State Farm insureds was invalid under Iowa law and could not be used by 33 to pursue the insurer for additional storm damage repairs. 33 had advertised and contracted with policyholders to “advocate” on their behalf when dealing with their property insurer after a loss. The insured also hired 33 to do any necessary repair work. The evaluation of the claim by the carrier fell by the wayside as 33 found more and more damages. Ultimately 33 Carpenters sued State Farm for damages based upon the assignment by the policyholder to 33. The trial court dismissed the case because 33 was acting as a public adjuster and had engaged in conduct prohibited by Iowa law for general contractors. In Iowa, all public adjusters must be licensed. The court held that because 33 was not licensed it did not have the power to contract, thus voiding its assignment from and contract with the policyholder. The Iowa Supreme Court affirmed the trial court’s dismissal. Citing to its holding in 33 Carpenters v. State Farm, the Supreme Court also affirmed dismissal in two similar cases filed by 33, 33 Carpenters v. The Cincinnati Ins. Co. (https://www.iowacourts.gov/iowa-courts/supreme-court/supreme-court-opinions/case/17-1979) and 33 Carpenters v. IMT Ins. Co. (https://www.iowacourts.gov/iowa-courts/supreme-court/supreme-court-opinions/case/19-0678).
This decision will curtail the practice of having unscrupulous businesses prey on Iowa insureds who suffer significant property damage, particularly after a widespread weather event such as hailstorm, straight wind event or tornado. LWC lawyers are often at the forefront of defending insurers who responsibly and professionally handle claims. LWC lawyers Brenda Wallrichs, Mark Parmenter and Shannon Powers successfully did so in winning the 33 Carpenters case
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