If you own a home in coastal Alabama and can't qualify for a standard Alabama home insurance policy, a FAIR Plan may be your only path to coverage. FAIR Plans are state-run insurance programs that exist specifically for homeowners who have been turned down by private insurers. They're not a first choice — instead, they serve as a backup for properties considered too high-risk for the standard market.
Alabama's version is called the Alabama Insurance Underwriting Association, and it's available to eligible homeowners in coastal portions of Baldwin and Mobile counties.
What is the Alabama Insurance Underwriting Association (AIUA)?
The Alabama Insurance Underwriting Association (AIUA) is Alabama's version of a Fair Access to Insurance Requirements (FAIR) Plan. Like FAIR Plans in many other states, the AIUA exists to make basic home insurance available to homeowners who've exhausted their options in the private insurance market.
As the state-run insurer of last resort, FAIR Plans tend to be more expensive and more limited in coverage than a standard home insurance policy. Many FAIR Plans around the country only cover fire damage, leaving homeowners to find wind coverage elsewhere. The AIUA is broader. It offers both fire coverage and windstorm coverage, which protects against damage from high winds, hail, and hurricanes. That combination matters most along Alabama's Gulf Coast, where wind damage from tropical storms and hurricanes is a leading cause of home insurance claims.
How to get coverage through the AIUA
You don't apply for a homeowners insurance policy through the AIUA directly. Instead, you'll need to find an AIUA-authorized insurance agent. The AIUA lists them on its Find an Agent page. While agents can't approve coverage themselves, they will submit the application on your behalf. Then, the AIUA reviews the application and decides whether to issue the policy.
Note that timing matters here. The AIUA pauses issuing new policies and making changes to existing ones whenever a tropical storm watch or warning is in effect for Baldwin or Mobile County or when a named storm is approaching the Gulf Coast. If you think you'll need AIUA coverage, apply early — waiting until a storm is already forecast could mean you're temporarily locked out of getting covered.
What does an AIUA policy cover?
The AIUA offers dwelling coverage for the structure of your home and personal property coverage for your belongings. However, you can’t get liability insurance or loss assessment coverage through an AIUA plan (whereas both are typically included in standard homeowners coverage).
A few notes about AIUA coverage:
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Dwellings, meaning the structure of your home, must be insured for 100% of their value. For instance, if the replacement cost of your home — the cost to rebuild it in like condition after a total loss — is $500,000, you must carry a policy with $500,000 in dwelling coverage.
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Personal property limits can never exceed 50% of the dwelling limit. For example, if you have $500,000 in dwelling coverage, you can get up to $250,000 in personal property coverage.
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Limited fair rental value coverage is available if you rent out part of your property — like a converted basement or guest unit — while still living there yourself. It can help replace lost rental income if your tenants have to move out during repairs after a covered loss.
AIUA policy coverage limits
A coverage limit is the maximum amount your insurance company will pay for a covered loss. If your damage costs more to repair than your limit allows, you're responsible for the difference — so higher limits generally mean better protection, especially for high-value homes.
As of Nov. 1, 2025, the AIUA raised its maximum coverage limits, giving homeowners more financial protection than before:
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Coverage type |
Maximum coverage limit |
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$650,000 |
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$325,000 |
Who is eligible for AIUA coverage?
Alabama FAIR Plan insurance isn’t for everyone. Instead, you must meet two key criteria to qualify for coverage:
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You must have been denied coverage through the standard insurance market.
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Your home must be south of the 31st parallel in Baldwin and Mobile Counties. You can determine if your home is a part of this coverage area using the AIUA’s maps feature.
Beyond that, the AIUA requires that your home:
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Is owner-occupied
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Meets applicable building codes and reasonable underwriting standards
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Has no pre-existing damage
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Has no unresolved repair issues that previously resulted in insurance denial, cancellation, or nonrenewal
Certain properties are ineligible for AIUA coverage, including:
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Vacant homes
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Farm property
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Homes located in Coastal Barrier Resources Act (CBRA) areas
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Manufactured homes that don’t meet AIUA’s minimum size or tie-down requirements
Does AIUA require flood insurance?
Yes, the AIUA requires Alabama flood insurance for homes located in Zone A or Zone V — two Special Flood Hazard Areas identified by the Federal Emergency Management Agency. Because the AIUA doesn't sell flood coverage, you'll need to purchase a policy separately, either through a private insurer or the NFIP.
Your flood coverage amount must match your AIUA policy limit. If your AIUA limit is higher than what the National Flood Insurance Program (NFIP) covers, you only need flood coverage up to the NFIP's maximum.
Condo owners in coastal Alabama may also need to purchase flood insurance, even if the condo’s master policy already includes coverage for floods. This applies to any condo units on the first or second floor.
How much does AIUA coverage cost?
How much Alabama FAIR Plan insurance costs depends on where your home is located in Baldwin or Mobile County, your dwelling coverage limit, and your deductible (the amount you agree to pay out of pocket toward a covered loss before your insurance steps in). Some homeowners may qualify for discounts if they've made upgrades to help their home better withstand high winds — a practice known as wind mitigation.
Broadly speaking, the average cost of homeowners insurance along Alabama’s Gulf Coast is generally much higher than coverage for homes farther inland, due to the increased hurricane risk.
How AIUA deductibles work
AIUA policies actually include two different deductibles. A standard deductible of $500 applies to most claims, while a separate hurricane deductible applies only when a hurricane causes the damage. Unlike the standard deductible, which is a flat dollar amount, the hurricane deductible is calculated as a percentage of your home's total insurable value, not necessarily your coverage limit.
For example, if your home has a $500,000 replacement value and a 5% hurricane deductible, you would pay $25,000 of covered hurricane damage before insurance pays out. Here’s the math:
$500,000 × 0.05 = $25,000 deductible responsibility
How to lower your Alabama coastal insurance costs: The FORTIFIED discount
One of the best ways to manage the high costs of home insurance in coastal Alabama, particularly if you have to buy AIUA coverage, is to upgrade your home to better withstand wind according to standards set by the FORTIFIED Home program, as developed by the Insurance Institute for Business and Home Safety. Wind mitigation updates can qualify you for significant homeowners insurance discounts.
In Alabama, adhering to FORTIFIED construction standards can save you between 25% and 55% on the wind portion of your home insurance premium — the amount you pay, usually monthly or annually, to keep your policy active. Those savings can be substantial, but it's also expensive to upgrade your home to meet the FORTIFIED standards.
That’s where Strengthen Alabama Homes (SAH) comes in. This program, which is a division of the Alabama Department of Insurance, offers grants up to $10,000 to help eligible homeowners in select Alabama counties upgrade their homes using FORTIFIED measures. This might look like major roof upgrades, impact protection for windows and doors, and roof-to-wall, story-to-story, and wall-to-foundation connections.
SAH accepts applications on a first-come, first-served basis. The online application process opens at various times throughout the year. You can visit the website to check out the current grant award schedule and learn more about the eligibility requirements and application process.
Savings do not stop with insurance discounts. After upgrading your home, you may be able to claim a state tax deduction the next time you file your taxes. Currently, you can claim either 50% of your total wind mitigation upgrade costs or $3,000, whichever is less.
Should you consider AIUA coverage?
The AIUA fills an important role by making basic home insurance available to Alabamians in high-risk hurricane areas when standard insurers won’t offer coverage. In some cases, it may be your only path forward to insure your home and fulfill your mortgage requirements.
That said, AIUA insurance isn’t intended to replace a traditional homeowners policy. You can only get an Alabama FAIR Plan insurance policy if you have no other option. These policies fall short of private coverage because they:
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Cost more
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Lack liability and loss assessment coverages
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Don’t auto-renew
If you’re out of options and forced into an AIUA policy, focus on making FORTIFIED upgrades to your roof and home. That may be enough to help you qualify for traditional coverage.
Frequently asked questions
Does Alabama have a FAIR Plan?
Yes, the Alabama FAIR Plan is the Alabama Insurance Underwriting Association (AIUA). It provides coverage for homeowners in parts of Baldwin and Mobile Counties who are denied policies by private home insurance companies.
Is FAIR Plan insurance good for Alabama homeowners?
FAIR Plan insurance is good for Alabama homeowners who can’t otherwise qualify for coverage with a private insurer. However, if you can get coverage from a private company, it’s better to go that route. You’ll likely find lower premiums and more comprehensive coverage in the private market. The AIUA only writes policies for homeowners who are unable to secure standard insurance.
How much should homeowners insurance be for a $400,000 home in Alabama?
The average cost of home insurance* in Alabama is $2,528 per year for a Kin policy with $400,000 in dwelling coverage. However, homeowners in coastal Alabama typically pay more because of the higher risks to their properties. If you can only qualify for Alabama FAIR Plan coverage from the Alabama Insurance Underwriting Association, expect to spend even more.
How does the FAIR Plan work?
Before homeowners can get FAIR Plan coverage in Alabama, you first need to be denied home insurance through the private market. If you live south of the 31st parallel in Baldwin and Mobile Counties and can’t qualify for traditional coverage, you’ll need to find an AIUA-authorized agent. If your property meets the AIUA’s eligibility requirements, the association will determine your coverage and rate based on factors such as your home’s location and replacement cost, as well as the policy’s deductibles.
