FAIR Plan insurance guide: What it is & how it works

FAIR Plans are designed for homes that don’t qualify for standard homeowners insurance due to their location, condition, or claims history. Over 30 states have some version of a FAIR Plan.

Pat Howard 1600Jennifer Gimbel

By

Pat Howard

Pat Howard

Managing Editor & Licensed Home Insurance Expert

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

Jennifer Gimbel

Senior Managing Editor & Home Insurance Expert

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.

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Michael Reynolds, CSRIC®, AIF®, CFT-I™

Michael Reynolds, CSRIC®, AIF®, CFT-I™

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Michael Reynolds, CSRIC®, AIF®, CFT-I™, is a financial advisor, principal and founder of Elevation Financial, host of the weekly personal finance podcast Wealth Redefined®, and a member of the Financial Review Council at Policygenius.

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Homeowners insurance is essential financial protection for anyone who owns their home. But finding coverage can be difficult if the insurance company thinks your home is at heightened risk of damage or loss. You can often be denied homeowners insurance because of your home’s location, physical condition, and claims history. That's where Fair Access to Insurance Requirements (FAIR) Plans come in.

Key takeaways

  • A FAIR Plan is a type of high-risk homeowners insurance for individuals who are unable to find coverage on the standard market.

  • FAIR Plans are usually more expensive and have limited protection compared to normal homeowners insurance.

  • FAIR Plan programs are run on the state level but funded by private insurance companies licensed to do business in that state.

  • Today, 33 states and Washington, D.C. offer some form of a FAIR Plan.

  • To be eligible for a FAIR Plan, you typically need to prove that you were denied coverage on the standard market.

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What is a FAIR Plan?

A FAIR Plan is the type of homeowners insurance you get when you’re not able to find coverage through a typical insurance company. Since they're typically more expensive and have lower coverage limits than standard home insurance policies, FAIR Plans are a good last-resort option for homes that don’t qualify for a standard policy.

These policies are often necessary in natural disaster-prone areas where homeowners insurance is hard to come by, including Florida, California, Louisiana, and Texas. 

While these plans are instituted at the state level, they’re financially backed by all private insurers licensed to write insurance in that state. Each of these companies shares in FAIR Plan profits, losses, and expenses at an amount proportional to its market share in the state. This allows multiple insurance companies to share the risk of the most high-risk homes, rather than just one company. 

What states offer FAIR Plan insurance?

The following states offer some form of FAIR Plan coverage to homeowners considered too high risk to qualify for insurance on the standard market.

What does FAIR Plan insurance cover?

FAIR Plan insurance coverage varies by state, but at the very least it usually includes dwelling coverage. Coverage for your personal belongings and additional structures on your property are usually only offered as optional policy add-ons. And loss of use and personal liability coverages generally sometimes aren’t even offered at all.

But in some states, like Texas and New Jersey, FAIR Plan coverage more closely resembles a standard homeowners insurance policy. And in The Golden State, the California FAIR Plan is now required to include a homeowners insurance policy in addition to its standard dwelling fire offering. [1]

Example of coverage provided by a Texas FAIR Plan policy

Here's an example of how much coverage you can purchase through the Texas FAIR Plan: [2]

Coverage type

What it covers

Coverage limit

Dwelling

Covers damage to the structure of your house

$1 million

Other structures

Covers damage to structures that aren’t attached to your home (sheds, fences, detached garages)

10% of dwelling limit

Personal property

Covers your personal belongings (furniture, electronics, appliances)

50%, 60%, or 70% of dwelling limit

Personal liability

Covers medical bills and legal expenses if you're held liable for an injury at your home

$100,000 or $300,000

Medical payments to others

Covers guests’ medical expenses, regardless of who is at fault

$5,000 per person/$25,000 per occurrence

Loss of use

Covers your temporary living expenses while your home is being repaired or rebuilt

10% of dwelling limit

FAIR Plan insurance statistics

FAIR Plan insurance policies have become more and more popular over the past decade as climate change continues to impact homeowners’ risks of wildfires, tornadoes, hurricanes, and other natural disasters.

  • 33 states and Washington, D.C. offer some type of FAIR Plan coverage for high-risk homeowners

  • Less than 3% of California homeowners had insurance through the state’s FAIR Plan in 2020 [3]

  • The number of homeowners in Texas who received insurance through the state’s FAIR Plan decreased by 7% in 2021 [4]

  • Over 10% of Florida homeowners have insurance through the state’s FAIR Plan sold through Citizen’s Insurance as of March 2022 — and that number is only expected to rise [5]

See if you qualify for FAIR Plan home insurance coverage

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When is a home considered too high risk to insure?

Your home may be considered high risk if it meets any of the following criteria:

Compare

High-risk location

Your home is in an area prone to severe weather or natural disasters, like wildfires, hurricanes, windstorms, or tornadoes

Values logo

Old & outdated house

Your home has old plumbing, outdated electrical wiring, a bad roof, or other characteristics that make it at heightened risk of damage

Policy

Bad claims history

Your home has a lengthy loss history, meaning several insurance claims have been filed at the residence in the past

What to do before applying for FAIR Plan insurance

If you’re getting denied homeowners insurance on the standard market, follow these steps before applying for coverage through your state's FAIR Plan:

  1. Talk to the insurance company If your homeowners insurance is canceled or you’re denied coverage because your home is too high risk, reach out to the insurance company and ask for the reason for denial. The insurer may provide you with a list of fixes or upgrades that can make your home more insurable.

  2. Talk to your neighbors Chat with people in your area and ask who they're insured with. If an insurance company is willing to insure the house down the street from you, then they may be willing to insure your home, too.

  3. Check your state’s department of insurance In addition to offering FAIR Plans, states also have departments that both regulate property insurance and provide educational resources about how to get insurance on the private market. Check your state’s website to get a list of private insurers who provide homeowners insurance in your area.

Are you eligible for FAIR Plan insurance?

If you’ve exhausted every option on the private market, your best option is your state’s FAIR Plan. While the process is fairly different in every state, you’ll likely need to meet the following eligibility criteria:

  • Proof that you were denied coverage from at least two insurers on the voluntary market — sometimes more. In New York, for example, you need proof that you were rejected by at least three insurance companies.

  • You may be required to make improvements or update your home to comply with local building codes, such as upgrading electrical work from aluminum to nonmetallic or copper.

  • The property doesn’t have any outstanding tax liens against it.

  • There aren’t any open insurance claims against the house.

Once you’re ready to apply for a FAIR Plan, contact your state’s insurance department to find out next steps. You’ll likely be directed to an insurance agent who will help you fill out your FAIR Plan application.

Where to find FAIR Plan insurance in your state

Here's a list of FAIR Plan resources and contact information for each state:

State FAIR Plans

Phone number

Alabama Insurance Underwriting Association

334-943-4029

California FAIR Plan Association

213-487-0111

Connecticut FAIR Plan

860-528-9546

Insurance Placement Facility of Delaware

215-629-8800

District of Columbia Property Insurance Facility

202-393-4640

Citizens Insurance Corporation (Florida FAIR Plan)

904-296-6105

Georgia Underwriting Association

770-923-7431

Hawaii Property Insurance Association

808-531-1311

Illinois FAIR Plan Association

312-861-0385

Indiana Basic Property Insurance Underwriting Association

317-264-2310

Iowa FAIR Plan Association

515-255-9531

Kansas All-Industry Placement Facility

785-271-2300

Kentucky FAIR Plan Reinsurance Association

502-425-9998

Louisiana Citizens Property Insurance Corporation

504-831-6930

Maryland Joint Insurance Association

410-539-6808

Massachusetts Property Insurance Underwriting Association

617-723-3800

Michigan Basic Property Insurance Association

313-877-7400

Minnesota FAIR Plan

612-338-7584

Mississippi Windstorm Underwriting Association

601-981-2915

Missouri Property Insurance Placement Facility

314-421-0170

New Jersey Insurance Underwriting Association

973-622-3838

New Mexico Property Insurance Program

505-878-9563

New York Property Insurance Underwriting Association

212-208-9700

North Carolina Joint Underwriting Association (FAIR Plan)

919-821-1299

Ohio FAIR Plan Underwriting Association

614-839-6446

Oregon FAIR Plan Association

503-643-5448

Insurance Placement Facility of Pennsylvania

215-629-8800

Rhode Island Joint Reinsurance Association

617-723-3800

South Carolina Wind and Hail Underwriting Association

803-737-6180

Texas FAIR Plan Association

800-979-6440

Texas Windstorm Insurance Association

512-899-4900

Virginia Property Insurance Association

804-358-0416

Washington FAIR Plan

425-745-9808

West Virginia Essential Property Insurance Association

215-629-8800

Wisconsin Insurance Plan

414-291-5353

See if you qualify for FAIR Plan home insurance coverage

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Frequently asked questions

How much does a FAIR Plan cost?

FAIR Plans are generally more expensive than a standard homeowners insurance policy, which costs around $1,899 per year, according to our analysis of home insurance rate data from across the country.

The cost of FAIR Plan insurance is determined by many of the same factors that impact your home insurance rates, including your home’s location, construction type, rebuild cost, and deductible amount.

How do you know if you’re eligible for a FAIR Plan?

In most states, you need to provide proof that you’ve been denied coverage by two or three insurance companies before you can become eligible for a FAIR Plan.

How does the California FAIR Plan work?

The California FAIR Plan is often necessary for residents of high wildfire-risk areas who aren’t able to find coverage on the standard market. A traditional dwelling fire policy from the CA Fair Plan covers damage from fire, smoke, lightning, windstorms, explosions, and vandalism, but doesn't cover water damage, theft, or personal liability. But under new orders from the state’s insurance commissioner, the FAIR Plan will be required to offer a comprehensive policy that includes all the same coverages as standard homeowners insurance. The changes will likely take effect in early February of 2022.

References

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Policygenius uses external sources, including government data, industry studies, and reputable news organizations to supplement proprietary marketplace data and internal expertise. Learn more about how we use and vet external sources as part of our

editorial standards.
  1. Insurance Journal

    . "

    https://www.insurancejournal.com/news/west/2021/09/24/633787.htm

    ." Accessed January 26, 2022.

  2. Texas Department of Insurance

    . "

    Texas FAIR Plan Association Overview

    ." Accessed September 13, 2022.

  3. California Department of Insurance

    . "

    New data shows insurance companies non-renewed fewer homeowners in 2020 while FAIR Plan ‘insurer of last resort’ policies increased

    ." Accessed January 26, 2022.

  4. Texas Department of Insurance

    . "

    Texas FAIR Plan Association Overview

    ." Accessed January 26, 2022.

  5. Florida Office of Insurance Regulation

    . "

    Property Insurance Stability Report - July 1, 2022

    ." Accessed September 13, 2022.

Authors

Managing Editor & Licensed Home Insurance Expert

Pat Howard

Managing Editor & Licensed Home Insurance Expert

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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.

Senior Managing Editor & Home Insurance Expert

Jennifer Gimbel

Senior Managing Editor & Home Insurance Expert

gray linkedin icon link

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.

Expert reviewer

Michael Reynolds, CSRIC®, AIF®, CFT-I™, is a financial advisor, principal and founder of Elevation Financial, host of the weekly personal finance podcast Wealth Redefined®, and a member of the Financial Review Council at Policygenius.

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