FAIR Plan Insurance in Alabama

Affordable Home Insurance Options in Alabama

Alabama is a beautiful state especially on the Alabama coastline. Of particular concern are properties located in Mobile and Baldwin counties but the problem persists across the state. In addition to the cancellation and non-renewals, most homeowners and homebuyers in these areas have been forced to pay extreme insurance premiums as a result of hurricanes, floods and tornadoes. In the past 10 years the state has seen many of the major insurance carriers refuse to offer coverage in this area and so homeowners have suffered.

What homeowners insurance options do I have?

As in many coastal states, the Alabama legislature created the AIUA (Alabama Insurance Underwriting Association), a type of FAIR Plan. This association offers the coverage that many companies in the private market are unwilling to provide.

The AIUA offers only two types of policies:
• A fire and extended coverage policy
• A wind and hail only policy (written in conjunction with a package policy offered by the private market).

Currently the AIUA is only offering coverage on condos, homes, mobile homes and commercial buildings that are located in the Gulf Front, Beach and Seacoast territories of Baldwin and Mobile counties. The coverage is limited to $500,000 total value of dwelling and contents, and $1 million for commercial buildings and business personal property. A separate deductible is typically applied for wind coverage.

Big Storms Have Led To High Homeowners Rates

The coastal exposure of Alabama has not been the only difficulty that the insurance markets have had. Flooding, extremely high snowfall rates, and deadly tornadoes have increased in recent years.

"Snowmageddon," as it was called, in 2014 saw several inches of snow, sleet and freezing rain fall in a short period of time and a temperature drop of 30 degrees in under 6 hours. On April 27, 2011 Alabama saw 39 tornadoes with 79 fatalities, thousands of homeowners insurance claims and billions of dollars paid out on just a single day. These events will continue to strain the insurance market and increase the likelihood of increased rates, cancellations and non-renewals. As with all FAIR Plans, consumers are encouraged to find their insurance in the private marketplace.

As with all FAIR Plans, consumers are urged to try to find coverage in the private market and we can help you find an agent that can help you find alternatives to the FAIR Plan.