Residual Markets

A myriad of different programs in place across the United States provide insurance to high risk policyholders who may have difficulty obtaining coverage from the standard market. So called residual, shared or involuntary market programs make basic insurance coverage more readily available. Today, property insurance from the residual market is provided by Fair Access to Insurance Requirements (FAIR) Plans, Beach and Windstorm Plans, and two state-run insurance companies in Florida and Louisiana: Florida Citizens Property Insurance Company (CPIC) and Louisiana Citizens Property Insurance Corporation (Louisiana Citizens). Established in the late 1960s to ensure the continued provision of insurance in urban areas, FAIR Plans often provide property insurance in both urban and coastal areas, while Beach and Windstorm Plans cover predominantly wind-only risks in designated coastal areas. Hybrid plans, like Florida's and Louisiana’s plans, provide property insurance throughout those states. It is important to note that in addition to windstorm risk, these plans routinely cover a range of other exposures, such as vandalism and fire.

 

INSURANCE PROVIDED BY FAIR PLANS BY STATE, FISCAL YEAR 2014 (1)

  Number of      
State Habitational policies Commercial policies Total policies Exposure (2)
($000)
Direct written
premiums ($000)
California 123,729 5,045 $128,774 $43,958,244 $73,384
Connecticut 2,779 103 2,882 532,514 3,842
Delaware 1,800 71 1,871 285,049 623
D.C. 303 79 382 107,000 349
Florida (3) 943,284 38,515 981,799 201,957,396 2,083,870
Georgia 28,768 1,638 30,406 4,066,259 26,869
Illinois 6,386 94 6,480 711,340 7,344
Indiana 2,284 54 2,338 175,625 2,458
Iowa 1,274 44 1,318 94,488 971
Kansas 16,095 183 16,278 968,312 8,678
Kentucky 11,748 534 12,282 604,164 7,881
Louisiana (3) 113,624 4,335 117,959 17,059,256 168,069
Maryland 2,004 86 2,090 391,000 1,337
Massachusetts 215,087 391 215,478 78,739,414 278,865
Michigan 22,230 387 22,617 2,887,324 24,137
Minnesota 5,711 42 5,753 956,310 4,146
Mississippi 11,393 (4) 11,393 711,411 8,669
Missouri 3,912 173 4,085 246,539 2,317
New Jersey 16,977 458 17,435 2,436,351 10,697
New Mexico 10,991 288 11,279 93,491 4,484
New York 50,935 3,348 54,283 14,169,172 35,488
North Carolina 151,822 2,613 154,435 13,571,310 61,679
Ohio 28,454 514 28,968 6,820,948 24,804
Oregon 2,594 51 2,645 272,000 889
Pennsylvania 19,057 1,415 20,472 1,646,337 8,052
Rhode Island 17,135 122 17,257 4,209,288 22,233
Texas 164,954 (4) 164,954 21,944,279 133,206
Virginia 33,975 531 34,506 4,671,246 21,028
Washington 64 21 85 25,406 171
West Virginia 534 65 599 34,719 360
Wisconsin 5,633 85 5,718 386,514 2,872
Total 2,015,536 61,285 2,076,821 $424,732,706 $3,029,772

(1) Excludes the FAIR Plans of Arkansas and Hawaii.
(2) Exposure is the estimate of the aggregate value of all insurance in force in all FAIR Plans in all lines (except liability, where applicable, and crime) for 12 months ending September through December.
(3) Citizens Property Insurance Corporation, which combined the FAIR and Beach Plans.
(4) The Mississippi and Texas FAIR Plans do not offer a commercial policy.

Source: Property Insurance Plans Service Office (PIPSO).

View Archived Tables

 

 

INSURANCE PROVIDED BY BEACH AND WINDSTORM PLANS, FISCAL YEAR 2014 (1)

  Number of policies      
State Habitational Commercial Total Exposure (2)
($000)
Direct written
premiums ($000)
Alabama 31,893 103 31,996 $5,558,923 $43,973
Mississippi 71,367 3,693 75,060 6,711,829 75,123
North Carolina 247,227 12,393 259,620 91,107,419 407,092
South Carolina 37,672 781 38,453 13,568,982 84,428
Texas 278,038 15,767 293,805 78,763,326 494,036
Total 666,197 32,737 698,934 $195,710,479 $1,104,652

(1) The Florida and Louisiana Beach Plans merged with their FAIR Plans.
(2) Exposure is the estimate of the aggregate value of all insurance in force in each state’s Beach and Windstorm Plan in all lines (except liability, where applicable, and crime) for 12 months ending September through December.

Source: Property Insurance Plans Service Office (PIPSO).

View Archived Tables