For some homeowners, finding home insurance can be difficult—especially if they’ve been rejected by insurance providers before because they live in a “risky” area. However, the state of Indiana has insurance assistance programs in place for these kinds of homeowners through the Indiana FAIR home insurance plan.

In this blog, Hammond’s insurance experts at Gutierrez Family Agency will give you a breakdown of the Indiana FAIR plan, offer resources for how to apply and prepare for a FAIR plan loan, and provide reasons why FAIR plans are beneficial to members of the Hoosier State.

What is a FAIR plan?

FAIR plans (short for Fair Access to Insurance Requirements) is a nationwide, nonprofit program that provides homeowners with accessible and affordable home insurance, even if they’ve been turned down for standard home insurance because they own a high-risk property.

The United States Congress set the stage for FAIR insurance plans in the 1960s, after a series of riots caused by police racism left many urban areas damaged and devastated. Insurance companies paid out claims for riot-related damage, but the financial risk of insuring people in these urban areas left many insurance companies hesitant to provide home insurance coverage.

With vocal support and a 1968 law passed by Congress, individual states (via nonprofit groups and private insurance companies) began to develop FAIR plan programs in order to ensure those in urban areas could receive affordable and accessible coverage for their homes. These initiatives are suitable for those in urban and coastal areas—many people living near oceans and lakes were turned down for insurance because of the higher likelihood of flooding, tropical storms, and hurricanes.

What are the requirements for FAIR plan home insurance?

For Indiana FAIR plan insurance, homeowners must occupy the home in which they’re applying for (vacant lots are not covered by Indiana FAIR plans). Some commercial buildings, rental properties, and personal property might be covered by FAIR plans. Homeowners must also prove that they’ve been unable to acquire standard Indiana home insurance. Finally, homeowners must allow for a complete inspection of their home by a third-party inspector, and submit a FAIR plan application.

What kinds of FAIR plans are there?

There are four primary FAIR plans, as stated by the Indiana FAIR plan website:

Dwelling Fire Basic DP1: Fire, vandalism, and malicious mischief. Extended coverages include: windstorm, hail, explosion, riot or civil commotion, aircraft, vehicles, smoke, and volcanic eruption.

Dwelling Fire Broad DP2: All coverages listed in DP1 coverages, plus: falling objects, weight of ice, snow or sleet, freezing, artificially generated electrical current, collapse, accidental discharge/overflow of water, sudden and accidental tearing apart.

Homeowners (HO-8) (Owner-occupied homes only): Fire, vandalism, and malicious mischief. Extended coverages include: windstorm, hail, explosion, riot or civil commotion, aircraft, vehicles, smoke, and volcanic eruption.

Homeowners (HO-2) (Owner-occupied homes only): All coverages listed in HO-8, plus: Falling objects, weight of ice, snow or sleet, freezing, artificially generated electrical current, collapse, accidental discharge/overflow of water, sudden and accidental tearing apart.

Homeowners policies can add on supplemental coverage, including theft, liability, and loss of use. Dwelling fire policies do not offer theft of liability coverage.

For more detailed information on Indiana FAIR plan insurance, take a look at the official FAIR plan FAQ.

What are coverage limits for FAIR plans?

Maximum coverage for Dwelling Fire Policies is $250,000—which includes the value of the building and eligible personal property within the building.

Homeowners Policies have a maximum coverage limit of $250,000, exclusively for building coverage.

Commercial fire policies have a maximum coverage limit of $1 million.

How do I get Indiana FAIR plan insurance?

To acquire Indiana FAIR plan insurance, homeowners must go to a certified Indiana FAIR plan insurance agent. These agents can help you determine the actual cash value (ACV) of your home, find the right plan for your home and your needs, and give you an accurate quote for what your annual FAIR plan payment will be if you are accepted into the FAIR plan program.

It’s important to note that insurance agents do not have binding authority when it comes to FAIR plan applications and processes. The Indiana FAIR plain program has final authority over all decisions regarding your application and coverage, and coverage is not in place until you receive acceptance and written acknowledgement from Indiana FAIR plan.

Choose Gutierrez Family Agency

As Hammond’s insurance agency of choice, Gutierrez Family Agency is a proud provider of Indiana FAIR plan home insurance, collaborating with FAIR plan representatives to help provide residents of Indiana with the home insurance they need. If you’ve been rejected for standard home insurance in the past, and believe FAIR plan insurance might be right for you, get in touch with Gutierrez Family Agency today.