The Texas Department of Insurance published an Official Order on its decision regarding the determination of underserved areas for the state’s FAIR Plan.
The FAIR plan is authorized to provide property owners’ association (POA) insurance to underserved areas within an area designated by the commissioner. In October 2024, the area was set as the region extending 10 miles inland from the border of the TWIA catastrophe area.
Under the Texas insurance code, the FAIR plan must make POA insurance available in areas where it is not reasonably available in the voluntary market. Petitions were submitted by five property owners’ associations, located along the north shore of Clear Lake, who claimed certain areas were underserved for POA insurance. None of the five petitioners were able to obtain POA insurance through the voluntary market and had to get coverage through surplus lines carriers.
After a public hearing and after reviewing the petitions and market data, the commissioner found that POA insurance was not reasonably available in the proposed underserved areas. The commissioner ordered that the Texas FAIR Plan accept POA insurance applications within the proposed underserved area. Applicants must prove the property meets reasonable underwriting standards, and they have been declined by at least two admitted insurers.
The proposed area can be found in the attached Appendix to the order, which can be found here.