FAIR Plan
A state-created insurance program providing basic property coverage to property owners in high-risk areas who cannot obtain insurance through the voluntary market.
FAIR (Fair Access to Insurance Requirements) plans were established following urban unrest in the 1960s to ensure property insurance availability in areas deemed undesirable by private insurers. Today, they primarily serve properties in high-risk zones such as wildfire-prone areas, coastal regions, and urban neighborhoods with elevated crime rates.
In COI compliance for commercial real estate, FAIR plan coverage on a vendor's property policy may indicate the vendor operates in a challenging geographic area. FAIR plans typically offer more limited coverage than standard market property policies, with higher deductibles and lower available limits.
Compliance teams reviewing certificates with FAIR plan coverage should verify that the basic coverage meets contractual minimums. Certificate holders in high-risk geographic areas should anticipate seeing FAIR plan placements and adjust their insurance requirements accordingly to avoid creating impossible compliance standards.
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