The bottom line
The California FAIR Plan is a state-mandated program founded in 1968 that provides basic home insurance coverage to high-risk homeowners who’ve been denied coverage by standard insurers. As an insurance pool, all licensed insurance companies in the state are required to write policies and share in paying out claims through the California FAIR Plan.
Insurance through the California FAIR Plan has become especially vital as wildfires continue to devastate the state, making home insurance harder to find on the private market. Just keep in mind these policies provide very basic coverage at typically higher costs, so they’re best saved as a last resort if you can’t find protection elsewhere.
Only covers damage caused by fire, lightning, smoke, and internal explosions
Need to add on endorsements or buy separate policies for protection from earthquakes, flooding, theft, and personal liability lawsuits
To qualify for coverage, you need to have been denied coverage on the private market
Basic coverages offered
The California FAIR Plan offers very basic coverage with its standard policy, which includes dwelling coverage and personal property coverage for your home against fire, smoke, lightning, and explosions. And that’s it.
If you want any additional coverages that are included in standard homeowners insurance policies like protection for other structures on your property or theft of your personal belongings, you’ll have to purchase add-ons or separate policies for an additional fee.
What perils are covered by the California FAIR Plan?
The basic California FAIR Plan policy covers damage to the structure of your home and personal property caused by four perils:
What perils are not covered by the California FAIR Plan?
The basic California FAIR Plan policy does not cover the following perils:
Windstorm or hail
Aircraft or vehicles
Vandalism or malicious mischief
Riot or civil commotion
Weight of ice, snow, or sleet
Sudden accidental damage from artificially generated electrical current
Additional coverages offered
You can add on the following coverages to your California FAIR Plan policy for an additional fee for more comprehensive protection.
Extended dwelling coverage: Covers your home from the following perils not included in the basic policy, including wind or windstorms, hail, explosions, riot or civil commotions, falling aircrafts, and volcanic eruptions.
Dwelling replacement cost coverage: Insures your home at its replacement cost, which doesn't include depreciation.
Other structures: Pays for damage to additional structures on your property, like a detached garage, shed, or guest house.
Vandalism or malicious mischief: Covers your home and property from vandalism or malicious mischief.
Extended personal property coverage: Covers your personal belongings from the following perils not included in the basic policy, including wind or windstorms, hail, explosions, riot or civil commotions, falling aircrafts, and volcanic eruptions.
Personal property replacement cost coverage: Insures your belongings at their replacement cost, which doesn't include depreciation.
Earthquake insurance: Protects your home and property from earthquakes through a separate earthquake insurance policy purchased through the California Earthquake Authority (CEA).
Inflation guard protection: Automatically increases the replacement cost of your home to account for a rise in construction, material, and labor costs due to inflation
Ordinance or law: Covers any mandatory structural upgrades that adhere to local building ordinances.
Permitted incidental occupancy: Covers damage to business property.
Improvements, alterations, and additions: Available for condo owners, this covers damage to improvements or alterations in your condo unit.
Fair rental value: Pays for lost rental income when a covered loss prevents you from renting out your home or unit.
Debris removal: Covers debris removal and property cleanup after a disaster.
Fences: Pays for damage to fences on your property.
Plants, shrubs, and trees: Pays up to $250 in coverage per damaged plant or tree.
Awnings and signs: Covers damage to awnings or signs on your property.
Outdoor radio and TV equipment: Covers damage to outdoor electronic equipment.
The California FAIR Plan does NOT offer liability coverage
If you’re looking for personal liability coverage, medical payments coverage, or protection against theft, you’ll have to purchase a separate difference in conditions (DIC) policy on top of your California FAIR Plan policy.
You can visit the California Department of Insurance website to find a list of private insurance companies in California that offer DIC policies to FAIR plan policyholders. Or check out our list of the best home insurance companies in California to see if they offer this type of coverage.
What’s the difference between actual cash value and replacement cost coverage?
The most basic California FAIR Plan policy comes with actual cash value coverage for your home and belongings. This means if your home is damaged by a covered peril, your insurance company will pay to rebuild your home — minus the cost of depreciation (aka wear and tear). While this type of coverage is less expensive, it also means you’ll get a smaller claim payout that might not cover the full cost to rebuild your home.
Alternatively, you can opt for replacement cost coverage. This is a more comprehensive form of coverage that does not take depreciation into account when determining the value of your home and belongings. Replacement cost coverage comes at a higher cost, but you’ll also get a larger claim payout.
The California FAIR Plan earns a low score on our price rating scale due to its high home insurance rates combined with a difference in conditions policy that are more than $1,700 higher than the California state average.
The California FAIR Plans earns a high score on our coverage options rating scale. Among its more noteworthy policy add-ons are extended dwelling and personal property coverage, earthquake insurance through its partnership with the California Earthquake Authority (CEA), inflation guard protection, and ordinance or law coverage.
While the California FAIR Plan has not been rated or evaluated by A.M. Best, it earns an above-average score on our financial strength rating scale since it only works with home insurance companies with an A- rating or higher.
How much does the California FAIR Plan cost?
Home insurance through the California FAIR Plan combined with a difference in conditions policy costs $3,200 on average, according to Phil Irwin, public relations representative for the California FAIR Plan.
Home insurance through the California FAIR Plan is typically more expensive than traditional home insurance policies since there’s more risk of your filing a claim.
"It's one of those situations that it is, any solution you're looking at is going to be expensive," Irwin tells KCRA NBC News.
As always, your own policy cost will depend on factors like your ZIP code, the age and condition of your home, how much coverage is in your policy, and your deductible amount.
What policy deductibles are available through the California FAIR Plan?
The California FAIR Plan offers deductibles that range from $100 to $10,000. As a refresher, your policy deductible is the amount that you pay out of pocket before your insurance kicks in.
A higher policy deductible will mean lower insurance premiums, but it also means you’ll have to pay more out of pocket after you file a claim. Be sure to choose a deductible you can comfortably afford should disaster strike.
Who is eligible for the California FAIR Plan?
To qualify for insurance through the California FAIR Plan, you need to prove that you’re unable to find coverage through a traditional insurance company.
In addition, your home must meet the following criteria to be eligible for coverage:
In good condition
Not boarded up
Secured with all doors and windows locked
No broken windows
Has not been vacant for more than a year
Isn’t used for illegal activity
How to get a California FAIR Plan quote
Follow these steps to get a quote for a California FAIR Plan policy:
Look over your previous home insurance policy. This will help you know what coverages and limits you might want to add to your new policy.
Apply for coverage on the private market. You can do this with the help of a licensed Policygenius agent by answering a few questions about yourself and your home. If you qualify for a traditional policy — great! If not, move on to step 3.
Find a California FAIR Plan broker. Use the California FAIR Plan “Find a Broker” tool and enter your ZIP code to get matched with a licensed agent in your area that can help you purchase a FAIR Plan policy.
Talk over your coverage options. Since the basic FAIR Plan policy is so limited, you’ll likely want to tack on coverage add-ons and even take out separate earthquake insurance and DIC policies.
Work with the broker to submit your application. This will include agreeing to a credit check and potentially having your home inspected.
Review your quote. Once you’ve received your quote, read through the policy to make sure you’re happy with your coverage and limits.
Sign your policy and make a payment. After you’ve signed your policy, you’ll need to pay your first policy premium before your coverage will go into effect.
What payment options are available through the California FAIR Plan?
You have a few different options to pay your California FAIR Plan insurance premiums:
Online through your checking or savings account
Online using your credit card
By mailing a check or money order to: California Earthquake Authority P.O. Box 76922 Los Angeles, CA 90076
California FAIR Plan customer service options
You can contact the California FAIR Plan customer service team two ways:
By phone: You can talk to a customer service rep by calling 213-487-0111 or toll-free 800-339-4099 — Monday through Friday from 8:30 a.m. to 4 p.m.
By mail: You can contact the California FAIR Plan by mail at: P.O. Box 76924 Los Angeles, CA 90076.
How to file a claim with the California FAIR Plan
You can file a claim with the California FAIR Plan by:
Online: Its 24/7 online claim reporting center can be accessed via the California FAIR Plan website. Make sure to have your policy number and the ZIP code of your property on hand.
By phone: You can call 800-339-4099 during business hours — Monday through Friday from 8:30 a.m. to 4 p.m. except for holidays.
How long does a California FAIR Plan policy last?
California FAIR Plan policies are issued for a one-year term, though you’re encouraged to shop around for a policy on the private insurance market often. This is because traditional home insurance policies offer more comprehensive coverage at a more affordable price.
California FAIR Plan policies are meant to be used only as a temporary stop-gap until you qualify for coverage on the private market, says California FAIR Plan spokesperson Hilary McLean.
“For most homeowners, the FAIR Plan is a temporary safety net, utilized until coverage offered by a traditional carrier becomes available,” says McLean. “The FAIR Plan encourages applicants and policyholders to search the market at least annually.”
Frequently asked questions
What is the most common type of claim filed by California FAIR Plan policyholders?
The most common type of claim filed by California FAIR Plan policyholders are fire claims, according to the California FAIR Plan Association.
Does the California FAIR Plan cover earthquakes?
No, the California FAIR Plan does not cover your home and belongings from earthquake damage — and neither do traditional home insurance policies. Instead, you’ll have to purchase a separate earthquake insurance policy through the California Earthquake Authority.
Pat Howard is a managing editor and licensed home insurance expert at Policygenius, where he specializes in homeowners insurance. His work and expertise has been featured in MarketWatch, Real Simple, Fox Business, VentureBeat, This Old House, Investopedia, Fatherly, Lifehacker, Better Homes & Garden, Property Casualty 360, and elsewhere.
Jennifer Gimbel is a senior managing editor and home insurance expert at Policygenius, where she oversees our homeowners insurance coverage. Previously, she was the managing editor at Finder.com and a content strategist at Babble.com.
Ian Bloom, CFP®, RLP®, is a certified financial planner and a member of the Financial Review Council at Policygenius. Previously, he was a financial advisor at MetLife and MassMutual.
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