Aetna Cas. & Sur. Co. v. Insurance Dept. of Iowa
| Decision Date | 17 December 1980 |
| Docket Number | No. 64841,64841 |
| Parties | AETNA CASUALTY & SURETY CO., Appellant, v. INSURANCE DEPARTMENT OF IOWA, Appellee. |
| Court | Iowa Supreme Court |
John A. McClintock and David L. Brown, of Hansen, McClintock & Riley, Des Moines, for appellant.
Thomas J. Miller, Atty. Gen., Fred M. Haskins and Bruce W. Foudree, Asst. Attys. Gen., for appellee.
Considered by REYNOLDSON, C.J., and HARRIS, McCORMICK, ALLBEE and LARSON, JJ.
A declaratory ruling of the insurance commissioner must be affirmed unless we change our long established measure of damages for motor vehicles. We decline to do so and affirm the district court's affirmance of the declaratory ruling.
Petitioner insurance company wished to initiate a new method of settling third party claims under the liability portion of its automobile insurance policies. The new method was challenged by the Iowa insurance department because it was inconsistent with Iowa law. Aetna thereafter discontinued the practice but, pursuant to section 17A.19, The Code 1977, and insurance department rule 510-2.2(502.505), Iowa Administrative Code, petitioned for a declaratory ruling by the commissioner. The insurance commissioner, thereafter affirmed by the district court upon judicial review (section 17A.19, The Code 1977), ruled adversely to Aetna.
For more than 50 years our cases on the subject have generally cited Langham v. Chicago, R. I. & P. R. Co., 201 Iowa 897, 901, 208 N.W. 356, 358 (1926), to describe the measure of damages for destroyed or damaged automobiles:
1. When the automobile is totally destroyed, the measure of damages is its reasonable market value immediately before its destruction.
2. Where the injury to the car can be repaired, so that, when repaired, it will be in as good condition as it was before the injury, then the measure of damages is the reasonable cost of repair plus the reasonable value of the use of the car while being repaired, with ordinary diligence, not exceeding the value of the car before the injury.
3. When the car cannot, by repair, be placed in as good condition as it was in before the injury, then the measure of damages is the difference between its reasonable market value immediately before and immediately after the accident.
See State v. Urbanek, 177 N.W.2d 14, 16-17 (Iowa 1970).
The petitioner's challenge is to the second of the Langham situations. Petitioner starts with "the reasonable cost of repair plus the reasonable value of use of the car while being repaired, with ordinary diligence, not exceeding the value of the car before the injury." To this petitioner would add a further limitation and in this proceeding asks us to adopt it as a part of the measure of damages. The change would add, as another...
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