Construction Claim Rules in Iowa

Statutory interest rate

Floating, 1-yr Treasury constant maturity + 2% (both pre- and post-judgment)

Iowa ties judgment interest to the one-year Treasury constant maturity rate published by the Federal Reserve, plus 2 percentage points, set as of the rate in effect immediately before judgment. If the underlying contract specifies its own rate (within the usury cap), the contract rate controls instead. Interest generally accrues from commencement of the action, not merely from judgment, for most claims.

Compounding: Simple, computed daily on the judgment balance.

Citation: Iowa Code § 535.3 (incorporating § 668.13's rate mechanism)

Source: https://www.legis.iowa.gov/docs/code/535.3.pdf

Last checked: 2026-08-25

The Iowa Judicial Branch publishes an updated table of the resulting rate each year, useful for keeping a calculator current without hardcoding the figure. Cross-checked the 1-year Treasury constant maturity rate + 2% against the Federal Reserve's official H.15 release (federalreserve.gov/releases/h15/), dated August 25, 2026: current computed rate is approximately 6.04%. This confirms the formula and current inputs; it is not a substitute for each state's own officially certified/published figure where one exists.

Accrual: breach of contract claim

Notable outlier: not date of breach, from the date the lawsuit was filed

Iowa Code § 535.3 calculates interest on money judgments using the rate mechanism in § 668.13, which accrues interest, other than interest on future damages, from the date the action was commenced. This applies broadly across judgment types in Iowa, including contract claims, not just from the date of breach.

Citation: Iowa Code §§ 535.3, 668.13

Source: https://law.justia.com/codes/iowa/title-xv/chapter-668/section-668-13/

Confirm this cross-reference against the current statutory text before relying on it; the accrual-from-filing mechanism was directly confirmed in § 668.13's text, while § 535.3's cross-reference to that mechanism for ordinary contract judgments was not independently re-verified word-for-word this pass.

Accrual: property damage / tort claim

Same rule as contract claims: from the date the action was commenced, not the date of loss

Iowa Code § 668.13, in the tort/comparative-fault chapter, explicitly accrues interest, other than interest awarded for future damages, from the date of the commencement of the action. This covers property-damage tort claims directly and is the same filing-date-based mechanism as the contract entry above.

Citation: Iowa Code § 668.13

Source: https://law.justia.com/codes/iowa/title-xv/chapter-668/section-668-13/

Like Texas, Michigan, Massachusetts and Louisiana's tort rule, Iowa ties interest to the filing date rather than the date of loss or breach, so filing promptly directly affects how much interest accrues.

Actual Cash Value rule

Broad evidence rule

Iowa courts consider all facts and circumstances that fairly tend to prove actual value (condition, age, original cost, market value, replacement cost) rather than a rigid replacement-cost-minus-depreciation formula, with full indemnification (and no more) as the touchstone.

Citation: Britven v. Occidental Ins. Co. of California, 13 N.W.2d 791 (Iowa 1944)

Source: https://www.propertyinsurancecoveragelaw.com/2015/06/articles/insurance/calculating-actual-cash-value-part-11-iowa/

A follow-up verification pass independently confirmed this case genuinely exists with this exact citation (13 N.W.2d 791, 234 Iowa 682, decided April 4, 1944) via CourtListener's citation index, but could not locate a free, directly-linkable full-opinion page (Justia's Iowa archive doesn't reach back to 1944 and CourtListener's own opinion pages are blocked from automated access); the blog link above remains the only accessible source, though the case's existence and citation are now independently corroborated rather than merely repeated from one source.

ACV statute or regulation

Iowa has adopted an administrative rule that statutorily defines ACV as replacement cost less depreciation (or market value) and requires the insurer to provide a depreciation worksheet on request, but it does not restrict labor depreciation specifically.

Iowa Administrative Code rule 191-15.44(507B), 'Standards for Determining Replacement Cost and Actual Cash Value,' defines actual cash value as the replacement cost of the property at the time of loss, less depreciation if any, and permits an insurer to instead use market value to determine ACV. The rule requires that, upon the insured's request, the insurer provide a copy of the claim file worksheet(s) detailing any and all deductions taken for depreciation. The rule text located does not single out labor cost as exempt from depreciation, so it does not ban or restrict labor depreciation, it only requires that any depreciation taken be documented and disclosed on request.

Citation: Iowa Admin. Code r. 191-15.44(507B)

Source: https://www.legis.iowa.gov/docs/iac/rule/03-20-2024.191.15.44.pdf

Recoverable depreciation holdback

No Iowa statute sets a holdback release deadline. A real administrative rule addresses how ACV is determined and requires a written explanation when recovery is limited, but does not resolve the labor-depreciation question -- a 2019 federal case applying Iowa law leaned against depreciating labor when ACV is undefined, and commentators have urged Iowa to adopt a California-style rule.

Iowa Admin. Code 191-15.44 sets standards for determining replacement cost and actual cash value, and requires insurers to provide a written explanation when recovery is limited due to nominal property value, but does not specifically address holdback release timing or the labor-depreciation question. On the related scope question, a federal court applying Iowa law found it illogical that insureds could infer labor would depreciate under an undefined 'actual cash value' term; legal commentary has recommended Iowa adopt a regulation similar to California's barring labor depreciation, but no such Iowa regulation was confirmed to exist as of this research.

Citation: Iowa Admin. Code 191-15.44.

Source: https://regulations.justia.com/states/iowa/agency-191/unfair-trade-practices/chapter-15/rule-191-15-44/

RESEARCHED from scratch (prior entry was blank). No holdback-timing statute found. The labor-depreciation position is persuasive commentary and a federal case interpretation, not a confirmed Iowa statute or regulation -- flagged as unsettled rather than resolved.

“No damages for delay” clause enforceability

Enforceable, with a strict active-interference exception requiring willfulness and bad faith

The Iowa Supreme Court enforced a no-damages-for-delay clause against a contractor's claim for extra heating costs caused by city- and other-contractor-caused delay, holding those delays were contemplated by the parties and entitled the contractor only to the time extensions it had already received, not additional money damages. A federal court applying Iowa law later distilled the active-interference exception into a strict, literal standard requiring some affirmative, willful act, in bad faith, to unreasonably interfere with the plaintiff's compliance with the contract terms, expressly rejecting a negligence-based standard and holding the doctrine requires more than a simple mistake, an error in judgment, or a lack of total effort.

Citation: Cunningham Bros., Inc. v. City of Waterloo, 254 Iowa 659, 117 N.W.2d 46 (1962); Peter Kiewit Sons' Co. v. Iowa S. Utils. Co., 355 F. Supp. 376 (S.D. Iowa 1973)

Source: https://law.justia.com/cases/iowa/supreme-court/1962/50601-0.html

Cunningham Bros. is the controlling Iowa Supreme Court decision; Peter Kiewit is a federal district court decision applying Iowa law that refined the active-interference test and has been influential nationally, not itself a state-court opinion. A free, directly-linkable full-text copy of Peter Kiewit wasn't located this pass.

Construction contract filing deadline

10 years for a written contract claim

Iowa's limitations period for an action founded on a written contract is 10 years from accrual, covering an ordinary written construction-contract claim.

Citation: Iowa Code § 614.1(5)(a)

Source: https://law.justia.com/codes/iowa/title-xv/chapter-614/section-614-1/

State unemployment insurance (SUTA)

New non-construction employer rate is 1.000% (Rank 4); new CONSTRUCTION employers pay 5.400% (Rank 9), more than 5x the general rate. 2026 taxable wage base is $20,400 -- a dramatic drop from $39,500 in 2025 following a major legislative overhaul (Senate File 607).

Iowa simplified its UI tax system in 2025 legislation: the wage-base formula changed from two-thirds to one-third of the state average annual wage, cutting the 2026 wage base nearly in half year-over-year, and the maximum possible rate dropped from 9% to 5.4%. Confirmed directly against the official Iowa Workforce Development handbook page.

Citation: Iowa Workforce Development (IWD).

Source: https://workforce.iowa.gov/employers/unemployment-insurance/unemployment-insurance-employer-handbook/unemployment-insurance-taxes

Last checked: 2026-08-26

MAJOR UPDATE: the prior entry only had the 1.0% general new-employer rate and did not mention the wage base at all. Both the construction-specific 5.4% rate and the dramatic 2026 wage-base drop (from $39,500 to $20,400, following a real legislative overhaul) are newly added, confirmed directly against IWD's own page.

Workers' compensation rating

Iowa uses NCCI advisory rates rather than its own rating bureau.

Iowa follows the standard NCCI advisory-rate model, with NCCI developing loss costs and classifications that are filed with the Iowa Insurance Division for approval. Workplace safety and claims disputes are handled separately by the Iowa Division of Workers' Compensation within the Department of Inspections, Appeals and Licensing (DIAL).

Citation: NCCI Iowa State Advisory Forum, Iowa Insurance Division

Source: https://www.ncci.com/Articles/Documents/II_StateAdvisoryForumState_IA_2024.pdf

Prevailing wage law

Iowa has no state prevailing-wage law for public construction contracts.

Iowa does not currently have a Little Davis-Bacon statute on its books requiring state-mandated prevailing wages on state or local public construction contracts. Public construction let by Iowa state or local agencies is governed only by the federal Davis-Bacon Act, and only when federal funds are involved.

Citation: U.S. Department of Labor state prevailing wage summary

Source: https://www.dol.gov/agencies/whd/state/prevailing-wages

A specific repeal date or prior statute citation for Iowa was not located this pass; the state simply does not appear on DOL's list of states with an active prevailing wage law.

OSHA plan

Federal OSHA (no state plan)

Iowa has no OSHA-approved state plan; both public and private employers fall under federal OSHA jurisdiction.

Citation: 29 U.S.C. § 667 (State Plan roster)

Source: https://www.osha.gov/stateplans/ia

Weight of an OSHA violation in a negligence case

Iowa is a split-rule state: pure negligence per se applies when the plaintiff is the defendant's own employee, but OSHA violations are merely some evidence of negligence when the parties lack a genuine employment relationship.

The Iowa Supreme Court held that an employer's violation of an OSHA standard constitutes negligence per se in an action by an employee against that employer. Where a worker was killed by a truck operated by a company for whom the worker did not work, however, the same court held the truck operator's OSHA violation was only evidence of negligence, not negligence per se -- Iowa applies a stricter rule for genuine employer-employee relationships than for third parties.

Citation: Koll v. Manatt's Transp. Co., 253 N.W.2d 265, 270 (Iowa 1977); Wiersgalla v. Garrett, 486 N.W.2d 290, 293 (Iowa 1992) (evidence only, non-employment relationship).

Source: https://storage.googleapis.com/jnl-bcls-j-bclr-files/journals/1/articles/232/63a30c0a100a2.pdf

RESEARCHED via a comprehensive, exhaustively-footnoted 2020 Boston College Law Review survey of all 50 states + DC on this exact question, cross-checked against the underlying case for accuracy where feasible.

Third-party contribution against the employer

Statutory employer is a live issue to check in Iowa, but the source doesn't detail the test.

Third-party claims otherwise turn on control, premises notice, negligent undertaking, product defect, and contractual indemnity.

Citation: Iowa Code ch. 85; Walker v. Mlakar, 489 N.W.2d 401 (Iowa 1992).

Source: https://law.justia.com/cases/iowa/supreme-court/1992/

Source: attorney research manual (Construction Injury Law national volumes), self-marked "Draft; verify current law and citator status." Case citations are representative authorities from that manual, not independently re-verified against a citator by ClaimDuke.

Injury-severity gate on contribution claims

Unusually broad immunity: Iowa gives the employer 'blanket immunity' with NO exception for intentional torts. A separate, narrower gross-negligence exception exists only against a co-employee, not the employer itself.

Harned v. Farmland Foods, Inc. establishes that Iowa Code Section85.20 gives the employer blanket immunity without an intentional-tort exception -- Iowa is among a small minority of states without one. A distinct, narrower path exists under Section85.20(2) allowing suit against a co-employee (not the employer) for gross negligence amounting to wanton neglect, following the demanding Thompson v. Bohlken standard.

Citation: Iowa Code ch. 85, Section85.20; Harned v. Farmland Foods, Inc., 331 N.W.2d 98 (Iowa 1983).

Source: https://www.iowacourts.gov/courtcases/20943/briefs/7150/embedBrief

RESEARCHED: the prior citation, 'Henrich v. Lorenz, 448 N.W.2d 327 (1989),' is real but addresses the coemployee gross-negligence framework, not employer exclusivity itself. Confirmed Iowa is a genuine outlier state alongside Alabama, Idaho, Maine, and Nebraska on the employer intentional-tort exception.

Distinctive state doctrine

Confirmed: no automatic statutory-employer immunity for a GC; this is a genuine, now case-confirmed outlier from the dominant pattern in this dataset; a citation error in earlier research is corrected here

Unlike nearly every other state researched, Iowa does not extend automatic exclusive-remedy immunity to a general contractor from a subcontractor's injured employee's tort suit (confirmed directly by Woodruff v. Barrick Roofers (see thirdPartyContribution), where a sub's employee's negligence suit against the GC proceeded without a statutory-employer defense barring it. This is a genuine, meaningful outlier: most other states in this dataset (VA, MO, LA, NM, HI, ND, SD, NE, WY, and many more) extend some form of statutory-employer immunity up the contractor chain; Iowa generally does not. Note: earlier research for this entry cited 'Iowa Code § 85.71' as the source of a GC upstream-liability rule, based on several SEO/marketing sources; that citation is incorrect); the current Iowa Code's actual § 85.71 governs injuries occurring outside the state, not GC liability for an uninsured subcontractor's employees; and has been removed as a reliable citation. On the separate intentional-act question, a secondary source lists Iowa among a small group of states (with Alabama, Colorado, Delaware, Georgia, Hawaii, Rhode Island, and possibly Idaho) with no intentional-act exception to exclusivity at all; the confirmed Iowa case law here does show Iowa allows a co-employee gross-negligence suit and independent-duty-based indemnity against an employer, which are different mechanisms from a direct intentional-tort exception against the employer itself; this narrower point about employer-directed intentional torts specifically was not independently confirmed this pass.

Citation: Woodruff Constr. Co. v. Barrick Roofers, Inc., 406 N.W.2d 783 (Iowa 1987); Iowa Code § 85.71 (current text, 'Injury outside of state' (corrects the earlier miscitation))

Source: https://law.justia.com/codes/iowa/title-iii/chapter-85/