Iowa’s insurance-advice laws don’t violate the First Amendment

Shamrock Hills Roofing argues Iowa’s law limiting what a contractor may say when it helps homeowners with insurance claims violates its right of free speech.DES MOINES, Iowa (CN) — Iowa state laws that bar residential contractors from advising homeowners on insurance claims without a state license do not violate the First Amendment right to free speech on their face, the U.S. Court of Appeals for the Eighth Circuit ruled Wednesday.Iowa’s statutes could violate freedom of speech depending on how they are applied to a particular contractor, however. That question was sent back to the U.S. District Court in Des Moines to be resolved.Shamrock Hills Roofing, a company in Overland Park, Kansas, that does business in Iowa and eight other states, argues that Iowa’s law limiting what a contractor may say when it helps homeowners with insurance claims violates the contractor’s right of free speech.Shamrock Hills sued the state September 2024 after Iowa insurance regulators warned the company it was potentially engaged in the practice of “unlicensed public insurance adjusting” based on the company’s use of terms and phrases in social media, such as “Our knowledgeable insurance claim specialists work through an easy claims process to help you get covered by insurance.”On Wednesday, the St. Louis-based Eighth Circuit partially affirmed U.S. District Judge Rebecca Goodgame Ebinger’s September 2025 decision granting Iowa’s motion to dismiss, holding that Iowa’s two statutes are facially constitutional and are not unconstitutionally vague. The appeals court, however, reversed in part, saying the federal court did not properly evaluate Shamrock Hills’ as-applied challenge and remanded the case on that question.Wednesday’s three-judge panel decision was written by Circuit Judge L. Steven Grasz and joined by Circuit Judge Jonathan Kobes, both Donald Trump appointees. Circuit Judge Jane Kelly, a Barack Obama appointee, joined in part and dissented in part.A key question in the case is whether Shamrock Hills engaged in “speech,” which would run into First Amendment territory, or “conduct,” which would not. One of Iowa’s challenged statutes prevents someone without a public adjuster license from acting for or aiding an insured person in negotiating or affecting the settlement of certain insurance claims. A companion statute regulates the same actions.The statutes do not run afoul of the First Amendment, at least facially, the appeals court held. The actions regulated by Iowa’s statutes are not “intended to be communicative” or “would reasonably be understood by the viewer to be communicative,” Grasz wrote, “so they amount to conduct rather than speech.”Focusing on one of Iowa’s challenged statutes, Grasz wrote that it “prohibits unlicensed public adjusters from engaging in several other activities in connection with negotiating or affecting the settlement of claims. For example, assessing damage to property, preparing estimates, reviewing insurance policies, evaluating coverage, submitting claims, devising strategies for pursuing coverage, and reviewing and filing legal documents all appear to fall within the statute. And some of these activities no doubt amount to conduct.”Thus, Iowa’s statutes have “a plainly legitimate sweep and survives Shamrock Hills’s facial challenge,” Grasz wrote.“Shamrock Hills’s as-applied challenge may be a different story,” he added.When weighing an as-applied challenge under the First Amendment, Grasz wrote that the reviewing court considers only whether the statute can be applied to specific conduct without violating the Constitution. This requires a three-step analysis: whether the activity is protected by the First Amendment, and if so whether a challenged the statute is content-based or content-neutral. Finally, the reviewing court applies the appropriate level of scrutiny.The district court did not engage in that three-step analysis. Instead, because it decided the statutes “do not regulate speech as speech, it did not analyze how Iowa applied them to Shamrock Hills,” Grasz wrote. “We accordingly reverse the district court’s dismissal of Shamrock Hills’s as-applied challenge and remand this issue for further proceedings.”Writing separately, Kelly concurred in part with the majority but dissented in part, saying she would not reach Shamrock Hills’ as-applied challenge.“Shamrock Hills brought both a facial and an as-applied First Amendment challenge in its complaint. But the as-applied challenge was not fully litigated at the district court, and as the court notes, the district court did not rule on it,” Kelly wrote, and Shamrock Hills did not mention this omission in its appeal.Neither Shamrock Hills nor the Iowa Attorney General’s Office responded to requests for comment.Subscribe to our free newslettersOur weekly newsletter Closing Arguments offers the latest about ongoing trials, major litigation and rulings in courthouses around the U.S. and the world, while the monthly Under the Lights dishes the legal dirt from Hollywood, sports, Big Tech and the arts.Additional Reads