UPDATED: APRIL 27, 2023 | 3 MIN READ
Homeowners with a history of repeat insurance claims or who reside in areas with high crime or severe weather may need help finding home insurance on the traditional insurance market. The Fair Access to Insurance Requirements program (a FAIR plan) helps high-risk homeowners locate policies that can protect their homes from damage from fire, smoke, tornadoes, and other covered perils.
Over 30 states and Washington D.C., offer a FAIR program. Each program varies by state, and coverage options are limited compared to a standard homeowners insurance policy. Below, we go into the basics of these programs, how they work, insurance coverage options, and what states feature a FAIR plan for homeowners insurance.
What is a FAIR Plan?
A FAIR plan is a subsidized statewide plan for home insurance. Insurance providers may deny a homeowner an insurance plan based on the homeowner’s previous claims or the property’s location or condition.
They’re high-risk home insurance plans for homeowners denied coverage from standard insurers. The programs consist of insurance coverage by several insurance companies covering a portion of the homeowner’s property.
How much is a FAIR plan?
The costs for FAIR programs vary by state, plus the homeowner’s property condition, location, and other criteria. A FAIR insurance plan offers property insurance for homeowners, but often at a higher cost than traditional insurers.
What does a FAIR plan cover?
FAIR program insurance coverage options vary by state; most aren’t comprehensive home insurance policies but basic home insurance coverage. According to the Insurance Information Institute, all state FAIR programs cover the homeowner’s dwelling against losses due to fire, vandalism, riot, and windstorm.
In some states, other coverage, such as personal property coverage, may exist only as an add-on policy. Unlike traditional homeowners insurance, a FAIR plan may not provide liability coverage and loss of use, except in certain states. Texas is one of the few states with robust FAIR plan insurance coverage, including coverage for other structures, liability, personal liability, and medical payments to others.
What is a high-risk home?
Eligibility for a FAIR plan depends on several criteria. States provide the program for high-risk homes, such as homes in poor condition or in a location with a high chance of disaster. A house may be high-risk if the property is:
- Located in a region prone to frequent disasters such as tornadoes, hurricanes, and wildfires
- In an area with high rates of crime, including theft and vandalism
- In need of repair, with worn roofs, old plumbing, or outdated electrical wiring
Home insurance companies deem these homes high-risk because the properties have high claim potential. Insurers use a Comprehensive Loss Underwriting Exchange (CLUE) database to examine previous and existing claims. CLUE provides a seven-year look at a home’s claims.
If an insurer finds a lengthy history of claims on a home when viewing on CLUE, it may deny coverage to the homeowner. CLUE also informs insurers when homeowners file claims so that insurers may look at an individual’s claim history.
States with FAIR Plans
To date, 33 states and Washington, D.C., offer a FAIR program. The name for a FAIR plan varies by state. For example, California calls its program California FAIR Plan Association, while Kansas’ program is Kansas All-Industry Placement Facility. The website for your state’s insurance department will list the name, information, and contact phone number for the FAIR program.
The following states plus D.C. offer FAIR programs:
- New Jersey
- New York
- North Carolina
- Rhode Island
- South Carolina
- Washington D.C.
- West Virginia
Windstorm and beach insurance
States susceptible to severe weather such as hurricanes and windstorms feature Beach and Windstorm Plans as an alternative to FAIR programs. The Florida, Mississippi, South Carolina, and Texas FAIR plans have hail and wind damage coverage, while Alabama and North Carolina include fire with their wind and hail coverage.
Alternatives to a FAIR Plan for Homeowners
A FAIR plan is an insurance plan of last resort. If an insurance company rejects a homeowner, the homeowner should consider trying other avenues before their state’s program. FAIR plans are often more expensive than traditional home insurance and may need more robust coverage.
To find a good home insurance plan, you may try the following:
- Contact your state insurance board. These departments will offer tips and information on home insurance, including a database of private insurers.
- You may also ask your neighbors about their home insurance provider, as that company may also cover you.
- Make necessary repairs if rejected because of your home’s condition.
If you still can’t find homeowners insurance, you will likely need a FAIR program if you want coverage.
Getting a FAIR Plan
Once a homeowner in a state with a FAIR program exhausts all possibilities for home insurance, they can try to sign up for the state’s plan. Private insurance providers and taxpayers subsidize each state’s program. Before a homeowner can sign up for one of these plans, they must prove at least two insurance companies from the voluntary market denied coverage.
Your state’s FAIR insurance plan may require denial by more than two insurance companies, so check for specific requirements. State insurance department websites include your state’s FAIR plan information and contact phone numbers. The FAIR insurer may also require you to make reasonable repairs to wiring and other elements that put your home at risk.
Does Utah have a FAIR plan?
Utah lacks a FAIR plan. The state’s location near the Wasatch Fault makes Utah susceptible to earthquakes, and the state experiences around 700 earthquakes yearly. Despite earthquakes in Utah, the Beehive State doesn’t offer a FAIR program for homeowners.
Does State Farm have a FAIR program for homeowners insurance?
FAIR programs operate with multiple private insurance companies covering portions of the homeowner’s property. State Farm may participate in your state’s FAIR insurance program. However, you can’t choose a FAIR program specifically from State Farm.
How much does a FAIR plan cost?
FAIR plans vary by state and cost more than a traditional home insurance plan to account for your high-risk home. The premium for your home insurance depends on your home, its square footage, condition, location, and other factors.
Can I bundle my FAIR plan with auto insurance?
No. A FAIR plan for home insurance isn’t the same as traditional home insurance and isn’t part of an insurance discount bundle. It’s a product subsidized by several private insurers and the state’s taxpayers.
Does the California plan offer earthquake coverage?
Yes. California’s FAIR program offers earthquake coverage to program participants with dwelling fire coverage. The plan in California doesn’t provide a standalone earthquake policy. Earthquake coverage applies to condos, mobile homes, single-family homes, and renters.
Find insurance and avoid a FAIR plan
When you have trouble finding homeowners insurance, don’t despair. If you live within the above 33 states or D.C., you may qualify for a FAIR program if rejected by two or more insurers. Before you sign up for a FAIR plan and pay rates higher than traditional insurance, explore your options from multiple insurers with our free tool. Retrieve your free home insurance quotes now.