By the Lapera Insurance Team · Reviewed by Joe Lapera, Licensed Illinois Insurance Agent (IL Lic #100722394)
If you have been non-renewed and turned down by other carriers, someone has probably mentioned the FAIR Plan. It is real, it is legitimate, and it is backed by the insurance industry itself, but it is built to be the last stop rather than the first. Here is what the Illinois FAIR Plan actually is, who can get it, what it covers and leaves out, and why the smartest way to use it is as a bridge back to the standard market.
The Illinois FAIR Plan Association is a not-for-profit property insurance association, formed in 1968 and supported by nearly 500 Illinois insurers, that provides basic coverage to property owners unable to buy insurance in the standard market for reasons beyond their control. To qualify, you generally must have been declined by standard insurers, and the home must be occupied, structurally sound and meet basic safety standards. You apply through any licensed Illinois agent.
Every state with a meaningful property insurance market has some version of a FAIR Plan, and in a year when Illinois carriers are tightening underwriting, more homeowners are finding out it exists. The name stands for Fair Access to Insurance Requirements. It was created so that a responsible homeowner who cannot get coverage through no fault of their own is never left completely uninsured. What it is not is a discount program or a way around a claim history. Understanding exactly where it fits keeps you from overpaying for it, or from avoiding it when it is the right answer.
What Exactly Is the Illinois FAIR Plan?
TL;DR: A not-for-profit insurance association backed by the insurers operating in Illinois, serving as the property market of last resort.
According to the Illinois FAIR Plan Association, the Plan is a not-for-profit property insurance association supported by nearly 500 Illinois insurance companies. It was formed in 1968 to provide basic property insurance to Illinois applicants who are unable to purchase coverage through the standard market for reasons beyond their control. It began by offering basic coverage only in designated urban areas and now writes Dwelling Property, Commercial Property and a range of Homeowners coverage statewide.
Two facts shape how you should think about it. It is not a government agency, and it is not a regular insurance company competing for your business. The insurers doing business in Illinois collectively support it so the state always has somewhere for a qualifying property to be insured. Once one of the largest insurers in Illinois, the FAIR Plan today writes only a small percentage of the state's policies, which is exactly how a market of last resort is supposed to look when the standard market is working.
Lapera Insurance Agency is a Farmers Insurance agency at 530 Barron Blvd in Grayslake, Illinois. Our team has worked with Illinois homeowners in the hard-to-place market since 1993, with over 40 years of combined experience, and we would always rather tell you honestly whether a standard policy is possible before recommending the market of last resort. Every guide on this site is reviewed by a licensed Illinois agent before it publishes.
Who Qualifies for the Illinois FAIR Plan?
TL;DR: Illinois property owners who have been unable to get standard coverage, on an occupied home that passes a basic safety inspection.
| Requirement | What it means in practice |
|---|---|
| Unable to get standard coverage | Required You generally must show unsuccessful attempts to obtain coverage from traditional insurers |
| Property in Illinois | Required |
| Occupied | Vacant homes are not eligible |
| Structurally sound and safe | Required Must meet basic fire, loss prevention and safety standards |
| Inspection | Expected An on-site inspection confirms the property meets FAIR Plan standards |
| Applied through an agent | Required Any licensed Illinois producer can submit the application |
The phrase that matters most is for reasons beyond their control. The FAIR Plan exists for the homeowner whose carrier exited the ZIP code, whose older house fails a standard carrier's age rules, or whose claim history sits just outside the standard market's appetite. It is not designed to insure a property in genuine disrepair, and the inspection is there to make sure it does not. The Illinois Insurance Association describes the eligibility basics in its consumer guidance.
When an Illinois insurer non-renews a homeowners policy, the notice is required to explain that you may be eligible for the FAIR Plan if you cannot find coverage elsewhere (Illinois Department of Insurance). Keep that letter, and keep the declinations from other carriers. They are the paper trail that shows you tried the standard market first.
What Does the Illinois FAIR Plan Cover?
TL;DR: Homeowners, dwelling and commercial property coverage, with homeowners forms that include liability, plus optional earthquake coverage.
Homeowners policies
Package coverage for the dwelling, other structures, personal property, loss of use and personal liability, similar in shape to a standard HO policy.
Dwelling property
Coverage on the structure for owner-occupied or non-owner-occupied homes, including smaller rental dwellings.
Commercial property
Basic property coverage for commercial buildings, with limited perils and actual cash value settlement, and no liability coverage.
Liability, on homeowners forms
The homeowners program includes personal liability. Commercial property policies do not include liability at all.
Earthquake endorsement
Available on request on Dwelling Property and Homeowners policies, with a standard 5% deductible. Not available on Commercial Property.
Electronic applications
The FAIR Plan no longer accepts paper applications for homeowners and dwelling coverage. Your agent submits electronically.
Those program details come from the FAIR Plan's own consumer page. The commercial side is notably narrow: the Plan states on its home page that commercial coverage is available up to $1,000,000 with limited perils and actual cash value settlements, and without liability coverage.
What Does the FAIR Plan Leave Out?
TL;DR: Flood, commercial liability, and some of the broader protections and endorsements a standard carrier would offer.
- Flood. Like every standard property policy, the FAIR Plan does not cover flood. That requires a separate NFIP or private flood policy.
- Liability on commercial policies. A commercial FAIR Plan policy is property only. A business or landlord needs liability coverage elsewhere.
- Replacement cost on commercial losses. Commercial settlements are actual cash value, meaning depreciation is deducted.
- The full menu of endorsements. Coverages a standard carrier might add easily, such as higher sub-limits for valuables or broad water backup options, may be limited or unavailable. Confirm each one you care about.
- Umbrella eligibility. Some umbrella carriers require a standard underlying homeowners policy. If you carry an umbrella, confirm it still applies before you move.
On flood specifically: NFIP policies carry residential building limits up to $250,000 and contents up to $100,000, with a standard 30-day waiting period (FEMA FloodSmart). A move to the FAIR Plan is a good moment to confirm whether you need one, because the answer does not change just because your home policy did.
Does the FAIR Plan Cost More Than Regular Insurance?
TL;DR: Usually yes, because it is priced for a pool of harder-to-insure properties, and its homeowners rates rose 11.6% in April 2026.
A market of last resort cannot price like a competitive carrier choosing its best risks. The FAIR Plan insures, by design, the properties other companies declined, and its rates have to be adequate for that smaller and riskier pool. The Illinois Insurance Association describes FAIR Plan premiums as typically higher than traditional coverage for exactly that reason.
The trend has been upward. The Department of Insurance approved an overall statewide average homeowners rate increase of 11.6% for the FAIR Plan, effective for new and renewal policies on April 1, 2026, according to the Illinois FAIR Plan Association. That does not mean every FAIR Plan policyholder saw exactly 11.6%, since individual premiums depend on the property, but it tells you the direction.
How Do You Apply for the Illinois FAIR Plan?
TL;DR: Through any licensed Illinois agent, with documentation of your standard-market declinations and an inspection to follow.
- Work through a licensed agent. The FAIR Plan does not sell directly to consumers. Any licensed Illinois producer can help you apply.
- Bring the declinations. Non-renewal notices and letters from carriers that declined you show that you tried the standard market.
- Size the coverage correctly. The amount you need depends on the policy form and the home's replacement cost. Do not simply copy your old dwelling limit if it was never checked.
- Expect an inspection. An on-site visit confirms the home meets FAIR Plan standards. Fix obvious hazards before it happens.
- Mind the timing. Start early enough that the FAIR Plan policy can take effect the day your current policy ends, with no gap for your lender to notice.
Still holding a non-renewal letter? Start with what to do after an Illinois home insurance non-renewal, which covers your notice rights, the hearing process and how to shop the standard market first.
How Do You Get Back to a Standard Policy?
TL;DR: Fix whatever kept standard carriers away, document it, and re-shop at every renewal until a standard carrier says yes.
Treat a FAIR Plan policy as a bridge. The goal is to spend a term or two there while you resolve the reason you landed in it, then move back to the standard market where coverage is broader and pricing is more competitive.
Resolve the flagged issue
A roof replacement, an electrical panel upgrade or a plumbing repair, documented with invoices and permits, removes the reason most carriers declined.
Let claims age
Claims weigh less as they get older. A clean few years moves you back inside more carriers' appetite.
Re-shop at every renewal
Carrier appetite changes. A company that said no this year may be writing your ZIP code again next year.
Keep the paper trail
Underwriters decide based on documentation. The better your house file, the faster you get back.
A Lake County homeowner with a 24-year-old roof is non-renewed and declined by three standard carriers. Illustrative sequence: they place the home on the FAIR Plan to avoid a gap, replace the roof the following spring with permits and invoices on file, and at the next renewal two standard carriers are willing to quote. The move back restores broader coverage and a lower premium. Timing and outcome vary by property; this is illustrative and not a promise of eligibility with any carrier.
Being a Farmers agency, we can tell you directly whether your house fits the Farmers family of companies' appetite today, and if it does not yet, what would need to change for it to.
The Bottom Line
The Illinois FAIR Plan does exactly what it was built to do in 1968: it makes sure a responsible Illinois homeowner who cannot get coverage through no fault of their own is never left uninsured. It is backed by the insurers doing business in the state, it covers homes, dwellings and commercial buildings, and you reach it through any licensed agent.
It usually costs more and covers less than a standard policy, and its homeowners rates rose 11.6% in April 2026, so use it as a bridge rather than a home. If you are weighing it, send us your declinations and your current declarations page first. We will tell you honestly whether a standard policy is still on the table before you settle for the market of last resort.
Related Questions
Who is eligible for the Illinois FAIR Plan?
Illinois property owners who have been unable to obtain coverage in the standard insurance market for reasons beyond their control. The home generally must be occupied, structurally sound and meet basic safety standards, and an inspection confirms this. Vacant homes are not eligible. You apply through a licensed Illinois insurance agent.
Is the Illinois FAIR Plan a government program?
No. The Illinois FAIR Plan Association is a not-for-profit property insurance association supported by nearly 500 Illinois insurance companies. It was formed in 1968 as a market of last resort and works with the Illinois Department of Insurance, which approves its rates, but it is not a state agency.
Does the Illinois FAIR Plan include liability coverage?
On homeowners policies, yes, the FAIR Plan homeowners program includes personal liability. Commercial Property policies do not include liability coverage, so a business or landlord insured through the FAIR Plan needs liability coverage from another source.
Is the Illinois FAIR Plan more expensive than regular home insurance?
Usually. Because it insures properties other carriers declined, its rates must be adequate for a smaller and riskier pool. The Illinois Department of Insurance approved an 11.6% statewide average homeowners rate increase for the FAIR Plan effective April 1, 2026. Individual premiums depend on the property.
Does the Illinois FAIR Plan cover flood or earthquake?
It does not cover flood, which requires a separate NFIP or private flood policy. Earthquake coverage is available on request as an endorsement to Dwelling Property and Homeowners policies, with a standard 5% deductible, according to the FAIR Plan Association. It is not available on Commercial Property policies.
Can you switch from the FAIR Plan back to a regular insurer?
Yes, and that is usually the goal. Resolve whatever caused standard carriers to decline, such as an old roof or outdated electrical system, keep invoices and permits as documentation, let older claims age, and re-shop at each renewal. Carrier appetite changes, so a company that declined you once may quote the home later.
Last reviewed September 2026 by Joe Lapera, Licensed Illinois Insurance Agent (IL Lic #100722394). Figures verified against the sources linked above on that date.