Illinois FAIR Plan: what it covers, what it costs, who qualifies

Does Illinois have a FAIR Plan?

Yes. Illinois has a FAIR Plan: the Illinois FAIR Plan Association (IFPA), the state's insurer of last resort, established under 215 ILCS 5/522 et seq. and active in Illinois since at least 1968. It writes basic property coverage when admitted carriers won't take a home. If you've just been non-renewed, that route is open here.

The IFPA is a risk-sharing pool, not a state agency: every property insurer licensed in Illinois is required to participate (Illinois FAIR Plan Association, verified May 2026). No taxpayer money backs it.

The plan handles fire and allied-perils coverage on dwellings and contents. It excludes liability, theft, water damage, flood, and earthquake; mine subsidence is handled by a separate state-administered Illinois Mine Subsidence Insurance Fund, not the IFPA. The eligibility rule, peril list, dwelling cap, and cost are detailed in the sections below; the headline is that this route exists, and an Illinois homeowner declined by admitted carriers can apply through a licensed agent (see: what a FAIR Plan is).

What does it cover?

The Illinois FAIR Plan writes on a named-peril basis: fire, lightning, wind, hail, explosion, smoke, vehicles, aircraft, and vandalism and malicious mischief (Illinois FAIR Plan Association, verified May 2026). Homeowners forms (HO-2 / HO-3 / HO-8) add burglary, theft, and personal liability; the plan's homeowners contract is more complete than the bare fire-only forms used in some other FAIR Plan states. Dwelling Fire policies (the DP-1 form) carry the base perils plus extended-coverage perils (riot, aircraft, vehicles, smoke) and vandalism, but not the homeowners add-ons.

Settlement is on an actual cash value basis: the dwelling's depreciated value, not the cost to rebuild it today. That's the major coverage gap versus a standard open-peril HO-3, which pays replacement cost and covers any peril not specifically excluded.

Two things the policy does not include: flood (federal NFIP or a private flood policy, separate) and earthquake on the base form. Earthquake is available as an optional endorsement on dwelling and homeowners policies, with a 5% deductible, directly through the plan (Illinois FAIR Plan Association, verified May 2026); commercial forms do not offer it.

A formal difference-in-conditions or 'wrap' policy (a second policy that fills the gaps a FAIR Plan leaves) is not routinely marketed alongside the Illinois plan (Illinois FAIR Plan Association). Because the IFPA homeowners form already carries personal liability, burglary, and theft, the gap-filling needs are narrower than in pure fire-peril states; the wrap section below covers when one still makes sense.

How much will it cover?

The Illinois FAIR Plan caps a single-family dwelling policy at $750,000 in Coverage A, with up to $375,000 for contents, $100,000 for condominium units, and up to $1,000,000 on commercial property (Illinois FAIR Plan Association, verified May 2026). Personal liability is optional and tops out at $300,000.

A few things worth knowing before building a budget around those numbers:

• Settlement is on an actual cash value basis, not replacement cost (Illinois FAIR Plan Association). Depreciation comes off any roof, siding, or interior claim before payout. See replacement cost vs. actual cash value for what that looks like in practice.
• The $375,000 contents figure is a ceiling, not a default. You set the insured value with your agent, up to that limit.
• The $1,000,000 commercial cap excludes farm and manufacturing property.

If the home's rebuild cost runs above $750,000, the FAIR Plan covers up to its cap and a difference-in-conditions policy, sometimes called a "wrap": a second policy that fills in liability, theft, water damage, and the dollars sitting above the cap. Eligibility and how to apply are below.

Who is eligible?

If you own and live in a 1-to-4-family home in an urban Illinois area and your insurer non-renewed you, you qualify for the FAIR Plan directly. The Illinois Insurance Code at 215 ILCS 5/524 draws a line between residential and commercial applicants: an owner-occupied dwelling triggers access on a non-renewal alone, with no minimum number of declinations from other carriers required (Illinois General Assembly, verified May 2026).

Commercial and non-residential applicants face a higher bar. They must document three declinations or non-renewals from unrelated insurers before the plan will write the risk, a rule the Illinois FAIR Plan Association repeats on its own site. Landlord-only and investor properties fall under that commercial track, not the residential one.

Two other tests apply across the board. The property has to sit at a fixed location and meet the plan's underwriting and condition standards. Vacant homes and severely deteriorated buildings are generally turned away; the FAIR Plan is the last-resort writer, not a salvage carrier.

The non-renewal letter is the document the plan looks for. Keep the original with the declarations page from the lapsed policy, and a licensed agent submits both as part of the application.

How do you apply?

You apply through a licensed Illinois insurance producer or agent, the FAIR Plan does not take direct-to-consumer applications. Since July 2015, paper applications are no longer accepted; every submission goes through the IFPA's electronic portal at ifpa.onaipso.com, which the producer files on your behalf (Illinois FAIR Plan Association, verified May 2026).

What that means in practice: the producer first locates the appropriate policy form for the property, files the application through the portal, and the IFPA then inspects the property and evaluates eligibility under 215 ILCS 5/524 before binding coverage (Illinois General Assembly, 215 ILCS 5/524). The plan publishes its own portal and rate information at illinoisfairplan.com; the producer-side filing system sits behind it at ifpa.onaipso.com.

Bring what any licensed agent will ask for: the property address, year built and square footage, the construction type and roof age, a recent declaration page from your prior carrier, the non-renewal letter if you have one, and a current mortgagee clause for the lender. If the home is currently vacant or under repair, say so up front, it changes which form the producer files. Coverage typically binds on the day the application clears the inspection and underwriting review, not on the day it's filed; until then, the prior policy's binder or grace period is what stands between you and a lender-force-placed policy (see: what an insurance binder is).

How much does it cost?

More than a standard homeowners policy from an admitted carrier, for narrower coverage. The Illinois FAIR Plan is the last-resort market, not a price-competition fallback: it was created so a home no voluntary carrier will write can still get fire coverage, not so it could undercut the open market on price.

The Illinois FAIR Plan Association doesn't publish an average premium or a public calculator; the rate-filing trend tells the story instead. The association has approved 8.3% on homeowners in 2022, 9.6% on dwelling fire in 2023, 9.4% on homeowners in 2024, and 13.8% on dwelling fire effective April 2025 (Illinois FAIR Plan Association, verified May 2026). Each filing was approved by the state insurance regulator before taking effect, so those are approved rates, not requests.

Two things drive the gap between FAIR Plan and standard pricing. First, the plan accepts homes the voluntary market has already declined: older roofs, prior claims, vacant or partially vacant properties, knob-and-tube wiring, so the risk pool is higher-loss by design. Second, the coverage is narrower (eligibility, perils, and limits are detailed elsewhere on this page), and a narrower policy at a higher premium is the trade the plan exists to make.

If a standard carrier just non-renewed your policy (the path most Illinois homeowners take to a FAIR Plan quote, walked through in what to do when your premium just jumped), the FAIR Plan number is the floor. Depending on what coverage gaps you have, the wrap-policy question below can add a second premium on top.

What is changing right now?

Five straight approved rate increases sit on the books at the Illinois FAIR Plan Association: homeowners +11.6% effective April 1, 2026; dwelling fire +13.8% effective April 1, 2025; homeowners +9.4% effective April 1, 2024; dwelling fire +9.6% effective April 1, 2023; and homeowners +8.3% effective April 1, 2022. The plan itself stays small, roughly 1,961 habitational policies and about $370 million total exposure as of FY2024, concentrated historically in older Chicago-area urban housing stock.

The bigger story sits outside the plan. Illinois is the only US state with no homeowners rate prior-approval authority, so carriers file and use without departmental sign-off. State Farm filed a +27.2% statewide average in 2025, the largest single homeowners filing in state history, and Allstate filed roughly $58 million in February 2026.

HB 4273 would change that. The bill passed the Illinois House 66 to 40 on March 19, 2026, and awaits Senate action. If enacted, it would give the Illinois Department of Insurance rate-rejection authority and require 60 days' notice before any premium increase of 10% or more, effective July 2027. Director of Insurance Ann Gillespie has led IDOI since April 2024 as acting director, and the Illinois Senate confirmed her on May 30, 2025.

For practitioners, the practical read: the FAIR Plan's own renewal pricing is locked in for the cycle, the voluntary market is mid-restructure, and the rate-approval framework itself may flip in 2027. New filings as they're verified appear on the changelog.

Do you also need a wrap (DIC) policy?

Probably not in Illinois, and that matters if a closing is on the calendar. The Illinois FAIR Plan homeowners form already bundles in personal liability up to $300,000 (optional) and theft and burglary coverage, which puts it closer to a standard homeowners contract than the fire-only forms sold in many other states (Illinois FAIR Plan Association, verified May 2026). Earthquake is available as an endorsement directly through the plan; flood is not, and never is, on any FAIR Plan policy.

A difference-in-conditions policy, sometimes called a wrap: a second policy that fills the gaps a FAIR Plan leaves. In Illinois, no carrier markets a named DIC product against this plan, because the plan covers most of what a DIC would normally wrap. Brokers can still supplement on a one-off basis if a lender flags a specific gap on the binder, but a separately quoted DIC isn't a routine line item here (Illinois FAIR Plan Association, verified May 2026). For a fuller explainer of what a DIC is and where it's standard, see what a difference-in-conditions policy is.

For a buyer mid-transaction: confirm with the lender exactly which coverages they require evidence of on the binder, then have the agent match the FAIR Plan form to that list line by line. Add flood through the NFIP or a private flood carrier if the property is in a Special Flood Hazard Area. That two-step usually closes the gap without a separate wrap.

Alternatives to the FAIR Plan in Illinois

Try the standard market first. The Illinois FAIR Plan exists because the voluntary market said no, and its base homeowners form is narrower than a standard HO-3 policy: no liability, no theft, no water damage. If an admitted carrier will write you, take that quote.

Three channels are worth working before the plan. First, an independent agent who places with several admitted carriers at once, including the smaller specialty insurers that quietly write older frame homes, rural properties, and homes with prior claims that the national brands decline. Second, the excess and surplus (E&S) market, also called non-admitted carriers: these insurers are licensed to do business in Illinois but not rate-regulated by the Illinois DOI, so they can write risks the standard market won't, usually at a higher premium and on broader forms than the FAIR Plan offers (see admitted vs. surplus lines for the practical differences in claims handling and state guaranty-fund backing). Third, an agent who specifically lists the older or higher-value home programs run by carriers like Chubb, Cincinnati, or AIG Private Client for homes that qualify.

If all three channels decline, the FAIR Plan is the backstop, and a difference-in-conditions policy fills the gaps it leaves. An independent agent can run admitted, then E&S, then the plan in one search, which is what the broker-finder route is built around.

What to do this week if you just got a non-renewal notice

1. Read the non-renewal letter and note the dates. The notice gives an effective date and a reason for non-renewal. Both matter: the effective date sets the clock for replacement coverage, and the reason (claims, condition, market exit) shapes which carriers will look at the home next.
2. Get quotes from at least three admitted carriers before going to the FAIR Plan. An independent agent can run several at once. If the home has a hail or wind claim history, an older roof, or sits in a high-risk pocket, declinations are common, not a failure on the homeowner's part.
3. If admitted carriers decline, ask a licensed agent or broker to file an Illinois FAIR Plan application. The plan is access-by-agent, not direct-to-consumer; the agent submits the application with the underwriting documents and signed declinations the plan requires.
4. Plan for a difference-in-conditions (DIC) wrap alongside the FAIR Plan policy. The FAIR Plan covers a narrow set of named perils, fire, lightning, wind, hail and similar, and excludes liability, theft, and most water damage. A DIC policy from an admitted carrier or surplus-lines broker fills those gaps; ask the same agent who places the FAIR Plan to quote it together.
5. Tell the mortgage servicer in writing that replacement coverage is being arranged. A coverage lapse can trigger force-placed insurance, which costs more and covers less. Send the binder or declarations page as soon as the new policy is bound.
6. If the non-renewal cites a specific condition like roof age, hail damage, or a prior claim, fix what is fixable before the next renewal cycle. See the full walkthrough at what to do after a non-renewal notice.