This bill amends Iowa law regarding the settlement of certain motor vehicle insurance claims, specifically focusing on the use of aftermarket crash parts and original equipment manufacturer (OEM) parts. It introduces a new subparagraph to Section 507B.4, which states that failing to comply with the newly established Section 507B.10 is a violation. The new section outlines the requirements for property insurers when settling first-party, partial-loss claims, mandating that they estimate repair costs based solely on aftermarket parts available within 100 miles of the repair facility and cover any necessary modifications.

For third-party, partial-loss claims, the bill stipulates that liability insurers must base their estimates on the cost of new OEM parts unless the vehicle owner provides written consent to use aftermarket parts and the insurer agrees to cover any modifications and defend the owner against related claims. Violations of these provisions can result in a cease and desist order, civil penalties ranging from $1,000 to $50,000, and potential suspension or revocation of the violator's business license.

Statutes affected:
Introduced: 507B.4