Massachusetts home insurance and the FAIR Plan.

What the Massachusetts FAIR Plan is and who it’s for

The Massachusetts FAIR Plan is the common name for the Massachusetts Property Insurance Underwriting Association, or MPIUA. It is the state’s residual property market: a place to get basic property insurance when the regular, voluntary market has turned you down. It operates under M.G.L. c.175C, the chapter titled Urban Area Insurance Placement, and its About page also references the Urban Property Protection and Reinsurance Act of 1968.

Every insurer writing basic property insurance in the Commonwealth is required to be a member of the association and to remain one as a condition of its authority to write that insurance here. Losses are shared among member companies on a premium volume basis. In plain terms, the carriers that don’t want your risk still fund the pool that covers it.

Eligibility is narrow by design. Any person or legal entity with an insurable interest in eligible Massachusetts property may apply, but only after being unable to secure coverage in the voluntary market. Coverage is provided without consideration of environmental conditions tied to the property’s location, which matters on the coast, but the risk still has to meet MPIUA’s Reasonable Underwriting Standards. Eligible property is real or tangible personal property at a fixed Massachusetts location and in insurable condition; automobiles are ineligible. Most people apply through a licensed agent or broker, though you can apply directly through MPIUA without one.

Why the FAIR Plan matters on Cape Cod and the Islands

The FAIR Plan is a modest slice of the statewide market and an enormous one on the coast. According to the Division of Insurance’s 2023 Annual Home Insurance Report, the FAIR Plan accounted for 8.3% of Massachusetts home insurance written premium in 2023. In every county except three, it writes under 10% of policies.

The exception is Barnstable, Dukes, and Nantucket Counties, the Cape and Islands, where the FAIR Plan wrote 33.0% of home insurance in 2023. That concentration tells you what coastal owners already know: voluntary carriers pull back from wind-exposed property, and the residual market fills the gap. The share has actually come down over time. In 2010 the FAIR Plan wrote 46.6% of home insurance in those same three counties. The market has softened somewhat, but the Cape and Islands still lean on the FAIR Plan far more than the rest of the state.

That is why a Cape Cod homeowner should treat the FAIR Plan as a real possibility rather than a last resort no one uses. It also explains why shopping matters. A voluntary carrier will usually give you broader coverage and more deductible options, so the FAIR Plan should be the floor, not the goal.

FAIR Plan coverage limits, forms, and terms

MPIUA writes under Homeowners, Dwelling Fire, and Commercial Property programs approved by the Division of Insurance. On the homeowners side it offers HO 00 02, HO 00 03, and HO 00 05 for owner-occupied one-to-four unit dwellings, HO 00 04 for tenants, and HO 00 06 for owner-occupied condo units. Dwelling Fire forms are DP 00 01, DP 00 02, and DP 00 03.

Coverage A on the homeowners forms runs from a minimum of $25,000 at a primary location, or $15,000 at a secondary location, up to a maximum of $1,000,000 at an insured location. Total insurance may not exceed the reasonable insurable value, nor $1,000,000 for a single interest, nor $1,500,000 for multiple interests at one location. If 90% of replacement value tops $1,000,000, the policy carries a mandatory Primary Insurance for Coverage A endorsement and you must show proof of an excess policy within 30 days of the effective date. Higher-value coastal homes routinely hit this ceiling and need a layered program.

Section II liability limits are also capped. Coverage E, personal liability, runs from a $100,000 minimum to a $500,000 maximum. Coverage F, medical payments, runs from $1,000 to $5,000. Insurance-to-value is enforced: policies incepting on or after 2/01/25 must be written at 90% or more of estimated reconstruction cost, up from 80% for earlier inceptions. The base deductible is $250, and MPIUA can impose a higher one; optional deductibles are $500, $1,000, and $2,500. Compare that against a standard Massachusetts homeowners policy, where dwelling and other structures are typically valued at replacement cost and liability commonly starts at a $100,000 base limit. The FAIR Plan gives you the essentials, capped.

Named storm and wind deductibles: how they work

This is where coastal owners feel the cost. A mandatory percentage named storm deductible applies to all HO 2, 3, or 5 policies in Barnstable, Dukes, and Nantucket Counties, and to any property within one-half mile of the coast in the rest of the state. The percentage scales with Coverage A and location.

Dukes and Nantucket Counties, in their entirety, take a 2% named storm deductible where Coverage A is under $200,000, and 5% at $200,000 and above. Barnstable County within one-half mile of the coast takes 2% up to $599,999 of Coverage A and 5% at $600,000 and above; more than one-half mile from the coast, Barnstable takes a flat 2% at all levels. The rest of the state within one-half mile of the coast takes 1% up to $499,999 and 2% at $500,000 and above. Properties more than one-half mile from the coast outside those three counties take a fixed-dollar minimum named storm deductible ranging from $500 to $5,000, keyed to Coverage A and the all-other-perils deductible. The same rule applies to Dwelling Policy forms DP 1 with extended coverage, DP 2, and DP 3.

Percentage deductibles are larger than they look. The Division of Insurance illustrates it plainly: a 5% deductible on a $200,000 dwelling limit means you pay the first $10,000 of a wind loss. Voluntary carriers do this too. Many have implemented mandatory wind loss deductibles in high-wind coastal areas, either a fixed dollar amount or a percentage of dwelling coverage generally ranging from 1% to 5%, tied to how close you are to the coastline. When you compare a FAIR Plan quote to a voluntary one, compare the storm deductible, not just the premium.

Inspections and the mandatory flood requirement

The FAIR Plan inspects. Producers must advise applicants that an interior and exterior inspection may be conducted, and the MPIUA field representative must be given full access to the building. Inspections are generally made in the company of the owner or a representative, and MPIUA re-inspects property after every fifth renewal, or sooner for high-value risks.

There is also a flood requirement you cannot skip. MPIUA requires flood insurance for all properties within Special Flood Hazard Areas in communities overseen by the Massachusetts Office of Coastal Zone Management. The coverage must be at least the lesser of the NFIP maximum or the amount sought from the Association, and you must provide proof within 30 days of each policy inception. For a coastal buyer this means the FAIR Plan homeowners policy is only part of the package; flood sits on top.

Flood insurance is separate, and what it costs you to carry

Standard homeowners and commercial policies do not cover flood damage, including flooding away from natural water sources. If your home is in a flood plain, your mortgage lender will require flood insurance regardless of the FAIR Plan’s own rule.

Most coverage comes through the National Flood Insurance Program, created by Congress in 1968 and administered by FEMA through a network of more than 48 insurance companies plus the NFIP Direct. Anyone in a participating NFIP community can buy it. Residential limits are $250,000 of building coverage for a single-family home ($250,000 per unit for residential condominiums) and $100,000 for contents, with contents coverage also available to renters. NFIP coverage generally takes effect 30 days after purchase. There is no wait when you buy in connection with making, increasing, extending, or renewing a mortgage, or when changing coverage at renewal; a one-day wait applies for property newly mapped into a high-risk zone within 12 months of the map change, and for flooding after wildfire within 60 days of containment. Private flood insurance is an alternative, and some carriers offer a more limited flood endorsement on a home policy.

Massachusetts protects borrowers here. M.G.L. c.183 §69 bars a lender from requiring flood insurance above the outstanding principal mortgage balance at the beginning of the year, from requiring contents coverage, and from requiring a deductible under $5,000. The lender must also give notice that the required coverage protects only its interest.

How to get out of the FAIR Plan or avoid it

The FAIR Plan is a bridge, not a destination. The Massachusetts Market Assistance Plan (MA-MAP) is a voluntary network of homeowners insurers and brokers that helps residents find coverage in the regular market, where you’ll usually get broader terms and more deductible flexibility.

If you were denied FAIR Plan coverage, c.175C §7 gives you ten days to appeal to the Commissioner of Insurance, with further review available in superior court. But most owners never reach that point, because the right first step is shopping the voluntary market. We place Massachusetts home coverage across carriers and can tell you quickly whether a voluntary option beats the FAIR Plan on price, deductible, and coverage. Start with our home insurance page, get a quote and let us run the comparison, or contact us to talk through a coastal placement.