What if I can't get coverage?

If you live in a home that is considered "high-risk" or plan to move to a high-risk location, you may have difficulty obtaining an insurance policy.

What constitutes high-risk? 

• Your home is located in an area prone to severe weather such as hurricanes, windstorms, tornadoes or hail.
• You live in an urban area with high crime, vandalism and theft.
• Your home has an old plumbing, electrical and/or heating system—these represent a higher chance of causing fire or water damage.

If one or two insurers turn you down, don’t despair. You do have other options. If you are buying a new home, ask the real estate agent, mortgage lender or builder for names of companies that write in your area. If it’s an existing home, ask the previous owners who insured the house. If you still can’t find coverage, consider the following:

Ask for help from your current insurance professional.

Talk to the agent or company representative that previously insured your home or is currently insuring your car, boat or business. If the problem is not where the house is located, but the condition that it is in, find out what type of improvements or disaster-resistant features would be needed to make your home more insurable. The Institute for Business & Home Safety (IBHS) also provides information on natural hazards, community land use and ways you can protect your property from damage.

Talk to your neighbors and find out which insurers they use.

Get the names of any agents who may be knowledgeable about the specific risks in your neighborhood.

Call your state insurance department

It can generally provide you with a list of insurers that write in your area. It might also have information regarding community groups that help homeowners with insurance problems such as the NeighborWorks America.

If you still can’t get insurance, find out if your state has a special insurance plan known as shared market. Generally, two types of plans exist:

1. FAIR Plans

Fair Access to Insurance Requirements (FAIR) Plans were created in the 1960s to make insurance available in areas that had abnormally high exposure to risks over which they had no control. These plans are insurance pools that sell property insurance to people who can’t get coverage in the voluntary market. FAIR Plan policies may cost more than private insurance and may offer less coverage, but they offer insurance protection where none would otherwise exist. All FAIR Plans cover losses due to fire, vandalism, riot and windstorm. About a dozen states have some form of a standard homeowners policy, which includes liability. In California, the Plan covers brush fires. Georgia and New York provide wind and hail coverage for certain coastal communities. In order to qualify for FAIR Plan coverage, you must:

• Make improvements that limit the risk of fire, theft or water damage, such as upgrading your electrical wiring, heating or plumbing systems, repairing your roof or improving security.
• If you do not correct conditions that make your home prone to losses, the FAIR Plan administrator has the right to deny insurance coverage.

Below are the states that offer FAIR Plan Insurance or assistance in getting coverage, and the telephone numbers of Plan administrators:

2. Beach and Windstorm Plans

In seven Atlantic and Gulf states, there is a counterpart to the FAIR Plans called Beach and Windstorm Plans. They provide residents and business owners, in designated areas, with coverage against hurricanes and other severe windstorms.

Windstorm Plans in Florida, Mississippi, South Carolina and Texas offer coverage only against wind and hail damage. Plans in Alabama and North Carolina offer coverage for fire as well. In New York, the Coastal Market Assistance Plan helps homeowners get coverage if their application has been rejected by at least three private insurers.