Maryland FAIR Plan (MPIUA)

Overview of MPIUA

The Maryland Property Insurance Underwriting Association (MPIUA), commonly known as the Maryland FAIR Plan, is the state's residual market mechanism for property insurance.

Purpose and Function

Eligibility Requirements

Who Qualifies for MPIUA

To be eligible for the Maryland FAIR Plan, applicants must:

1. Good Faith Effort: Made reasonable attempts to obtain coverage in the standard market
2. Declinations: Been declined by at least two admitted insurers
3. Property Standards: Meet minimum insurability requirements
4. Maryland Location: Property must be located in Maryland

Properties Typically Insured

• Older homes that don't meet modern building codes
• Properties in high-crime areas
• Properties with adverse loss history
• Coastal properties with windstorm exposure
• Vacant or unoccupied buildings
• Properties in urban areas with limited market access

Coverage Available

Basic Coverage Package

Coverage Limitations

MPIUA coverage is more limited than standard homeowners:

• No personal liability coverage (Coverage E)
• No medical payments coverage (Coverage F)
• Limited additional living expense coverage
• No scheduled personal property coverage
• Higher deductibles typically required

Application Process

Steps to Obtain MPIUA Coverage

1. Documentation: Obtain written declinations from standard insurers
2. Application: Submit MPIUA application through licensed agent
3. Inspection: Property inspection may be required
4. Underwriting: MPIUA reviews and issues policy or requests improvements
5. Policy Issuance: Coverage begins upon premium payment

Property Inspection Requirements

Before issuing coverage, MPIUA may require:

• Exterior and interior inspection
• Electrical system evaluation
• Heating system assessment
• Roof condition report
• Evidence of required repairs

Rates and Costs

Pricing Structure

• Higher than standard market rates (typically 10-50% more)
• Limited discounts available
• Mandatory deductibles higher than standard policies
• Annual policy term only

Loss Sharing

All property insurers licensed in Maryland share MPIUA losses proportionally based on their voluntary market share. This spreads the risk of high-risk properties across the entire industry.

Exam Tip: The Maryland FAIR Plan (MPIUA) requires applicants to be declined by at least two standard insurers before applying. MPIUA provides fire and extended coverage but NOT comprehensive homeowners coverage or liability protection.