Vermont FAIR Plan: there isn't one, and what to do instead

Does Vermont have a FAIR Plan?

No. Vermont has no state FAIR Plan and no state-backed insurer of last resort. The state isn't listed in the Insurance Information Institute's FY2024 FAIR Plans table and isn't a PIPSO member. After a non-renewal, the only fallback is the surplus lines (non-admitted) market, brokered through DFR-licensed surplus lines brokers.

The historical reason is loss profile. FAIR Plans were created under the 1968 Urban Property Protection and Reinsurance Act to backstop brush-fire, coastal-wind, and inner-city-arson markets. Vermont's dominant catastrophe risks are flood and freeze, outside that 1968 framework.

The legal pathway when admitted carriers decline a home is the surplus lines (non-admitted) market, set out in Vermont Statutes Title 8 Chapter 138. Under 8 V.S.A. § 5024, a licensed surplus lines broker must document a diligent search of the admitted market before placing coverage with a non-admitted carrier. Vermont has no surplus lines stamping office and no surplus lines association; brokers file quarterly with the Vermont Department of Financial Regulation directly.

For a homeowner with a non-renewal letter tonight, the practical next step is an independent agent who runs admitted specialty carriers first, then a surplus lines broker if those decline. Eligibility tests, what the surplus lines market typically covers, and what to ask a broker are below.

What does it cover?

Nothing, in Vermont. There is no state FAIR Plan policy form to cover anything, because the state has not chartered a FAIR Plan or a residential property pool of last resort. There is no named-peril basic-fire shell to fall back on, no statutory dwelling cap to quote, no contents sublimit, and no list of included or excluded perils to compare against an HO-3.

That makes the coverage question a different question in Vermont: not "what does the plan cover" but "what does the policy a surplus-lines broker can place actually cover, and how does it compare to the HO-3 the non-renewed policy used to be." The honest answer is that it varies carrier to carrier. Most surplus-lines homeowners forms in Vermont are written on a named-peril basis (the policy lists the perils it covers, and anything not on the list is not covered), not the open-peril basis of a standard HO-3 (which covers any peril unless the policy specifically excludes it). The practical gap on a named-peril form is usually water damage, theft, and broader liability; flood and earthquake are excluded on both forms and are bought separately (flood through the NFIP or a private flood carrier).

Because no single state plan form sets the floor, a difference-in-conditions policy, sometimes called a "wrap": a second policy that fills the gaps the primary leaves, is sometimes layered over a thin surplus-lines policy in Vermont to restore HO-3-like breadth. Whether a wrap is worth it depends entirely on which named-peril form the broker can place; the wrap conversation is in the DIC section below.

How much will it cover?

There is no Vermont dwelling cap to cite, because Vermont does not run a FAIR Plan. The coverage ceilings discussed on other state pages, the California FAIR Plan's $3 million dwelling cap, the Texas FAIR Plan Association's tiered limits, do not apply here.

What a non-renewed Vermont homeowner is shopping for instead is a policy from the excess and surplus lines (E&S) market or a specialty admitted carrier, and on those policies the dwelling limit is set by the carrier and the agent, not by a statutory pool. The practical anchor is the home's replacement cost: the figure your insurer should rebuild to after a total loss, which is usually higher than the price you paid or the tax-assessed value (see replacement cost vs. actual cash value).

Two things to ask the agent for, in writing: the dwelling limit (Coverage A), and whether the policy is written on a replacement-cost or actual-cash-value basis. Contents limits on E&S property policies typically run as a percentage of the dwelling limit, but the percentage and any sub-limits, for jewelry, electronics, or outbuildings, vary by carrier and need to be read off the declarations page.

Who is eligible?

There is no eligibility test for a Vermont FAIR Plan because the state has no FAIR Plan to be eligible for. Vermont is one of roughly 14 states without a residual property-insurance pool, so the gating questions you would face in California or Texas (a documented diligent search, two written declinations, an owner-occupancy rule, a coverage-amount cap) do not exist here.

What does exist is a different gate: the surplus-lines (excess and surplus, or E&S) market. A Vermont-licensed surplus-lines broker can place coverage with a non-admitted carrier only after the risk has been declined by admitted carriers, under Vermont's surplus-lines law at Title 8, Chapter 138 of the Vermont Statutes. In practice that means an independent agent runs the risk through standard markets first, documents the declinations, and then approaches an E&S carrier if no admitted insurer will write the home.

Owner-occupancy, rental, or investor status is decided carrier by carrier, not by a statewide rule. Specialty admitted carriers and E&S markets each have their own appetite, and a landlord policy on a rented single-family home is a different conversation from a primary residence with prior water claims. Prior losses on the CLUE database, roof age, woodstove use, and distance to a fire hydrant or fire station all weigh more heavily here than they would inside a FAIR Plan, because the underwriter is pricing the risk rather than accepting it under a residual-market mandate. The Vermont Department of Financial Regulation publishes the consumer-side overview and the complaint route if a placement falls through.

How do you apply?

There is no Vermont FAIR Plan application to fill out, because Vermont has no FAIR Plan. The route after a non-renewal runs through a licensed Vermont property-casualty agent, who shops the admitted market first and, if no admitted carrier will write, places the home in the surplus-lines (excess and surplus, or E&S) market under Title 8, Chapter 138 of the Vermont Statutes.

Two channels do most of the work. An independent agent (one who quotes several admitted carriers, rather than a captive tied to a single insurer) is the first stop; the Vermont Department of Financial Regulation publishes a consumer help page that points to licensed agents and explains the complaint route if a carrier refuses to engage. If the admitted market turns the home down, the agent refers the file to a surplus-lines broker licensed under Chapter 138 to place the risk with a non-admitted carrier.

Documents to have ready before the first call: the non-renewal letter itself, the current policy declarations page, the most recent home inspection or roof age, any prior-claims history (the prior-claims database insurers pull is called CLUE), the year built and rebuild cost, the distance to the nearest fire hydrant and responding fire department, and, for homes near the July 2023 flood footprint (FEMA disaster 4720), proof of any post-flood repairs.

Turnaround varies. An admitted-market quote often lands within a few days; a surplus-lines placement and the temporary proof of coverage a closing lender accepts, called a binder, can take a week or two (see: what an insurance binder is).

How much does it cost?

Vermont doesn't run a FAIR Plan, so there is no published rate filing to point to. The cost question lands instead on two markets: a handful of specialty admitted carriers still writing in Vermont, and the surplus-lines (excess and surplus, or E&S) market for everything they decline. Neither posts standard rates the way a residual plan would.

As a working frame, surplus-lines premiums on a home that admitted carriers won't take typically run well above the voluntary-market rate for a similar home, sometimes two to three times the prior premium, with a narrower form, higher deductibles, and limits set by the underwriter rather than by a statutory cap. The wider the gap between the home's profile and what admitted carriers will write, the larger the premium gap. Surplus-lines policies in Vermont are written under Title 8, Chapter 138 of the Vermont Statutes, which governs non-admitted insurers and surplus lines, and they sit outside the Vermont Insurance Guaranty Association, so the carrier's own financial strength matters.

What drives the number on a Vermont quote: distance from a responding fire department and the home's protection class, roof age and material, the wood-heat setup, prior water or fire claims (these surface through CLUE, the industry's prior-claims database), and exposure to the flood and washout risk that's been reshaping the state's underwriting since the July 2023 floods. A surplus-lines binder is usually issued for 30 to 90 days while the agent finishes paperwork; the annual premium is set at binding, not at quote.

If the renewal premium on an existing policy jumped without a non-renewal, the route is different and is covered separately (see my premium just jumped).

What is changing right now?

With no FAIR Plan to track, the moving pieces in Vermont are the flood layer and the admitted market's posture around it, not policies-in-force or assessment math. Two consecutive July floods (FEMA-4720-DR-VT on July 10, 2023 and FEMA-4810-DR-VT on July 10, 2024) reset the underwriting picture statewide; the standard-market response now shows up in renewal and quote behavior rather than in any pool's exposure report.

Act 181, the flood-risk disclosure statute, took effect June 17, 2024. It requires sellers in residential real-estate transactions to disclose known flood risk to buyers, and does not change rating, eligibility, or non-renewal rules. For an agent or loan officer, the file-level question shifts from "is flood the buyer's call?" to "what does the seller disclosure say, what does the elevation certificate show, and is the property in a Special Flood Hazard Area for NFIP rating?"

NFIP uptake is the other moving figure. As of March 2026, NFIP policies in force in Vermont were roughly 4,500, against approximately 2,223 in April 2024, close to a doubling in two years (Vermont Department of Financial Regulation, verified May 2026). DFR issued a Consumer Advisory on Rising Insurance Premiums in January 2025; brokers fielding non-renewal questions can point clients to that, and to the late-2023 Bulletin 227 flood-data call, as the documented regulatory backdrop.

Regulatory turnover matters for filings. Kaj Samsom was appointed Commissioner of Financial Regulation on April 14, 2025, after Kevin Gaffney retired and Sandy Bigglestone served as Acting Commissioner from January through April 2025 (Vermont Department of Financial Regulation). On January 28, 2026, Christine Brown was elevated to Deputy Commissioner of Captive Insurance. The Vermont Climate Council released its 2025 Climate Action Plan on July 1, 2025, which frames the regulatory direction without, on its own, changing any line of business.

What is not changing: there is no plan to depopulate, no member-insurer assessment to track, and no statutory non-renewal moratorium tied to a federal disaster declaration. The 2026 legislative session is the next watch item; updates land on the changelog.

Do you also need a wrap (DIC) policy?

Vermont has no FAIR Plan to wrap, so the usual FAIR-plus-DIC stack doesn't apply here. The relevant question instead: if the only policy you can place is an excess & surplus (E&S) form that's been stripped down to fire and a few extended-coverage perils, do you need a second policy to fill the gaps. Often, yes.

A difference-in-conditions policy, sometimes called a 'wrap': a second admitted policy that sits beside a stripped-down base policy and adds back what the base excludes, typically liability, theft, water damage, and sometimes broader perils, up to a stated limit. It is a coverage layer, not a price tool, and it does not duplicate the base dwelling limit.

For a buyer closing on a Vermont home with an E&S binder, two questions matter to the lender's file. First: does the base form include the dwelling-replacement and liability coverages the loan note requires, or only fire and extended coverage? Second: if it's the latter, will the wrap be in force on the close date, with the lender named as mortgagee on both policies? Independent agents who write Vermont E&S property typically know which specialty admitted carriers will pair a DIC behind their form; ask the agent in writing.

Wraps in Vermont are not a posted-rate product, and no public filing carries a typical premium for this market. Get the quote in writing alongside the base policy, and read both forms before close. See: what a difference-in-conditions policy is.

Alternatives to the FAIR Plan in Vermont

With no state-run plan to fall back on, Vermont homeowners who can't get a standard policy work through two channels: excess and surplus (E&S) lines carriers, and a small set of specialty admitted carriers that still write the harder risks. Both are reached through a licensed agent, not by walking up to a 1-800 number.

E&S carriers (sometimes called non-admitted or surplus-lines insurers) are licensed to do business through Vermont's surplus-lines framework under Title 8, Chapter 138, but their rates and forms aren't filed with the state, and policyholders don't have access to the state guaranty fund if the carrier becomes insolvent. In exchange you get a market that will quote older homes, woodstove heat, long driveways, prior water-loss histories, and properties insurers in the standard market have declined. Expect higher premiums, larger deductibles, and named-peril rather than open-peril forms. The difference between an admitted and a surplus-lines policy matters at claim time: see admitted vs surplus lines.

Try the specialty admitted carriers first. A handful of regional and farm-mutual insurers (Vermont Mutual, Co-operative Insurance Companies, and the New England regionals) write outside the appetite of the national brand-name carriers and stay inside the admitted, rate-filed system. An independent agent who represents several of these markets is the fastest route; a captive agent for one national carrier generally cannot reach them. If three or more admitted carriers decline, E&S is the next stop.

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

A non-renewal notice is jarring, especially after years with no claims. Vermont doesn't have a FAIR Plan to fall back on, so the path runs through the regular market first, then the surplus-lines (E&S) market if the regular market won't write. The steps below are in order, and the whole sequence usually takes two to four weeks if started promptly.

1. Read the notice carefully and write down the effective date. The date the current policy ends is the deadline that matters; a mortgage lender will require continuous coverage, and a lapse triggers force-placed insurance, which is expensive and bare. Note the stated reason for non-renewal, because the next agent will ask.
2. Call an independent agent who writes with multiple admitted carriers in Vermont. Independent agents (as opposed to captive agents tied to one carrier) can quote several companies in one conversation. Ask them to run the standard admitted market first, including any specialty admitted carriers that take older homes, woodstoves, or rural-access properties.
3. If the admitted market declines, ask the same agent for a surplus-lines (E&S) quote. Surplus-lines carriers are licensed to write risks admitted carriers won't, under Vermont Statutes Title 8 Chapter 138. Expect a higher premium and a named-peril form rather than the standard HO-3.
4. Get the quote in writing and compare deductibles, exclusions, and the dwelling-replacement figure before binding. A cheaper premium with a 5% wind deductible or an actual-cash-value roof can cost more after one claim.
5. If the property is in a flood zone or near a stream that flooded in July 2023, price flood coverage separately through the National Flood Insurance Program or a private flood carrier; a homeowners policy never covers flood.
6. If the search stalls, the Vermont Department of Financial Regulation consumer-services line can confirm whether a carrier is properly licensed and help with complaints.

For the full walk-through of options, paperwork, and what to ask each agent, see the non-renewal playbook.