The California FAIR Plan was created in July of 1968 following the 1960’s brush fires and riots. It is an insurance pool established to assure the availability of basic property insurance to people who own insurable property in the State of CA and who, beyond their control, have been unable to obtain insurance in the voluntary insurance market.
There is no public funding or taxpayer’s money involved. The FAIR Plan is not a state agency.
The FAIR Plan is stronger than any single insurer since it is backed by the capital and surplus of all insurance companies writing property insurance in the state.
The California FAIR Plan Association is a syndicated fire insurance pool comprised of all insurers licensed to conduct property/casualty business in California. It was established in August of 1968 as an insurance placement facility.
The Plan issues policies on behalf of its member companies. Each member company participates in the profits, losses, and expenses of the Plan in direct proportion to its market share of business written in the state.
The California FAIR Plan is not a true homeowner’s, but as stated above, can provide basic property insurance to people who own insurable property in the State of CA and who, beyond their control, have been unable to obtain insurance in the voluntary insurance market. This is very important to those of us who are in a brush or fire zone!
The amount of combined coverage available to an insured with the CA FAIR Plan has increased from $1.5 to $3 million. You should combine this CA FAIR Plan policy with a Difference in Condition (DIC) policy. CA FAIR Plan does have gaps in coverage and the DIC can help. It does not close all the gaps, but it can get you closer to the comfort of a Homeowner’s policy.