What is the purpose of the Colorado FAIR Plan Association?

The Colorado FAIR Plan Association provides basic property insurance coverage, including commercial property insurance, when admitted companies do not offer it. Any insurance producer in the State of Colorado can access the FAIR Plan on behalf of a consumer seeking coverage that was denied by the standard market.

When can I apply for coverage through the Colorado FAIR Plan?

Access to Colorado FAIR Plan policies and applications for them is not expected until early 2025. The Board was seated in January 2024 and is actively working to build the Association.

Where can I find the plan of operations?

The Board submitted the Plan of Operations to the Division of Insurance, which approved it on July 26, 2024.

What if I am unhappy with my insurance company's coverage or costs?

The Colorado FAIR Plan Association is not a market of choice, but a market of last resort. To apply to the Colorado FAIR Plan Association, your producer must have evidence of at least three declinations of coverage from standard carriers for your property showing that no other coverage options exist.

Are there other insurance options currently available in the marketplace?

If you are shopping for insurance, any insurance producer should be able to guide you through the process. You can contact a producer of your choice. If standard insurers cannot cover your property due to its high risk, your agent may recommend exploring the surplus lines market. Surplus lines insurers specialize in covering properties that don’t meet the underwriting standards of the traditional market.

These policies:

• Are designed for high-risk properties.

• May offer more customized coverage options than the FAIR Plan.

• Are almost always more cost-effective than FAIR coverage.

What is the cost of the Colorado FAIR Plan?

Due to the elevated risks associated with the residential and commercial properties we insure, FAIR Plan policies are only for people who cannot get insurance from the standard market. They come with substantially higher premiums and offer more limited coverage.

What is a market of last resort?

A last resort market means it is not a market of choice. No other markets should exist to qualify for coverage through the FAIR Plan. When your producer applies to the FAIR Plan on your behalf, they will need to provide documentation that they have tried to place your coverage in the standard market and have been unable to find other coverage.

A market of last resort also means the FAIR Plan only offers basic coverage. It is not meant to compete with the standard insurance markets and should only be used for short periods when no other markets exist.

Who is eligible for coverage under the Colorado FAIR Plan?

Eligibility for the Colorado FAIR Plan is restricted to property owners who cannot obtain insurance from standard insurance companies due to the high-risk nature of their properties. To qualify, property owners must provide proof of rejection from three standard market property insurers. If you are unsure about your eligibility, contact your insurance agent. Remember, coverage through the Colorado FAIR Plan can only be purchased through a licensed insurance agent.

What is the Colorado FAIR Plan?

The Colorado FAIR Plan is a safety net, providing access to basic property insurance for Coloradans who own otherwise uninsurable properties. It is designed to offer limited coverage to properties that standard insurers deem too high-risk. While it’s not a preferred option, the FAIR Plan is a crucial last resort for those unable to find coverage in the standard market.

When will Colorado FAIR Plan coverage be available to property owners?

The Colorado FAIR Plan is expected to start offering policies in early 2025. However, it's important to note that this coverage will come with high premiums and limited options, reflecting the elevated risk of insuring high-risk properties.

What should property owners do if they can’t find property insurance coverage today?

Consult a licensed insurance agent if you're having trouble finding property insurance. Your agent can help you shop around for coverage from various standard insurers and may explore the surplus lines market, which specializes in insuring high-risk properties. The Colorado FAIR Plan is only meant to be used as a last resort, so standard insurance should be pursued first. Standard insurers typically offer more competitive rates and broader coverage. However, if no standard insurer is willing to provide coverage, the Colorado FAIR Plan is available as an emergency backup to ensure your property remains insured. Remember to continue checking with your agent, as marketplace conditions change routinely, and new insurance options may become available.

What can I do about increasing property insurance rates?

The rising cost of homes, inflation in labor and materials, and increased risks from wildfires and hailstorms all contribute to the rapid increase in property insurance rates in Colorado. Some insurers are reducing their capacity to take on additional risk, particularly in high-risk areas. Working with an insurance agent to shop for coverage from multiple insurers is the best approach for most property owners. You may find more cost-competitive policies with comparable coverage by comparing different options. Remember that the insurance market is constantly evolving. So, it’s wise to reassess your options with your agent periodically. To better understand Colorado’s property insurance landscape and for tips on finding coverage, check out the Colorado Division of Insurance’s Homeowner Toolkit.

How do I apply for Colorado FAIR Plan coverage?

If you are eligible for the Colorado FAIR Plan, coverage can only be obtained through a licensed insurance agent. Please contact your agent for more information.

Are you a producer interested in writing the FAIR Plan?

Producer registration will be available in late 2024.