Iowa Casualty Study Guide

Thirty-three of the eighty-three scored questions on the Iowa Casualty exam are Iowa-specific — the heaviest state weighting of any producer exam Iowa offers. Two questions in every five are Iowa law, and the law they test is genuinely idiosyncratic. Iowa’s auto minimums are among the lowest in the country, its uninsured motorist rule works the opposite way round from most states’, its comparative-fault bar pays a claimant that other states would turn away, and its workers’ compensation benefit is calculated on a base almost nobody else uses.

Auto — a tort state with low limits

Iowa is fault-based. There is no no-fault system and no mandatory personal injury protection; medical payments coverage exists and is optional (Iowa Code chapter 668). If an item puts an Iowa driver into a PIP threshold analysis, it has imported another state’s law.

The financial responsibility minimums under § 321A.1(11) are 20/40/15 — $20,000 bodily injury per person, $40,000 per occurrence, $15,000 property damage. Low, and worth memorising precisely because they are low: a candidate half-remembering the common 25/50/25 will overshoot every figure.

Uninsured motorist — included, not offered

This is the rule that turns on one verb, and it is the most testable item on the auto side.

Iowa Code § 516A.1 requires uninsured motorist coverage to be INCLUDED at limits equal to the bodily injury liability limits — unless the named insured rejects it in writing. Underinsured motorist coverage rides alongside on the same terms and is likewise rejectable in writing.

Most states require UM to be offered. That is an opt-in: the insurer must make the offer, and the insured must take it. Iowa makes it an opt-out. The coverage is in the policy by operation of law, and it leaves only by a written rejection from the named insured.

The practical consequence is what gets tested. On a policy where nobody ever discussed uninsured motorist coverage, an offer state produces a policy without it; Iowa produces a policy with it. And an oral rejection, or a rejection by someone other than the named insured, is not a rejection at all.

Comparative fault — and the claimant at exactly fifty

Iowa apportions liability under the Comparative Fault Act, Iowa Code chapter 668. It is a modified system with what practitioners call a 51% bar: under § 668.3(1), a claimant whose fault is greater than the combined fault of the defendants recovers nothing. Below that line, the award is reduced by the claimant’s own share.

Now the edge case, because it is where the marks are. The bar is greater than, not equal to or greater than. So a claimant found exactly 50% at fault still recovers — half their damages.

Plenty of states are drafted as “50% or more bars recovery,” which produces the opposite result on identical facts. Exam writers build items precisely at that boundary, because it separates candidates who learned the number from candidates who learned the comparison. If a fact pattern hands you a claimant at exactly fifty per cent, it is testing this and nothing else.

For drivers who cannot obtain coverage voluntarily, the residual market is the Iowa Automobile Insurance Plan — the assigned-risk mechanism.

Workers’ compensation — eighty per cent of spendable earnings

This is the most distinctive rule in Iowa insurance law, and the one most worth getting exactly right.

Coverage is mandatory for essentially all employers with one or more employees (§§ 85.1, 87.1) — no small-employer threshold to remember, unlike states that start at three or five. The system is administered by the Iowa Division of Workers’ Compensation, inside Iowa Workforce Development — not by the Insurance Division.

Then the benefit. Iowa Code § 85.37 pays 80% of the employee’s weekly SPENDABLE earnings, capped at 200% of the statewide average weekly wage.

Spendable means after payroll taxes. Nearly every other state pays a fraction — commonly two-thirds — of gross wages. These are not two ways of saying the same thing; they are different constructions reaching different amounts, and Iowa’s is deliberately designed to land near actual take-home pay. An item offering “66⅔% of the average weekly wage” for Iowa is offering another state’s answer. The word to hunt for is spendable.

Two deadlines complete the block, and items routinely swap them: notice to the employer within ninety days of the injury (§ 85.23), and the claim filed within two years of the injury, or within three years of the last weekly benefit payment (§ 85.26). Different clocks, different consequences. An employer complies by insuring with a licensed carrier or qualifying as an approved self-insurer (§§ 87.1, 87.4).