Arizona does not offer an official Fair Access to Insurance Requirements (FAIR) Plan or any state-run insurer of last resort for homeowners insurance. Thirty-one states and Washington, D.C. offer one of these programs, but the Arizona Department of Insurance & Financial Institutions (DIFI) does not.
That means Arizona homeowners who are denied standard home insurance coverage from private insurers have to take an alternate route: the surplus lines market. Surplus lines insurers specialize in issuing policies for especially high-risk properties and situations, though they aren't licensed in the same way as standard insurance companies.
Arizona has no FAIR Plan, but the term still shows up — here's why
If you're searching for home insurance in Arizona, you might come across insurers using the term "FAIR Plan" loosely, especially if they offer last-resort coverage of their own. But there's no official, state-run FAIR Plan or equivalent in Arizona. Instead, a licensed insurance professional can help connect you with special markets, including surplus lines insurers, if you're denied standard coverage.
What Arizona homeowners can do instead: The surplus lines market
If you get denied by multiple private insurers in Arizona, one possible alternative is the surplus lines market, also called excess and surplus (E&S) insurance.
Surplus lines insurers provide coverage for various risks, including Arizona wildfires, that standard insurance companies cannot or will not insure. These policies are generally used for higher-risk homes, such as those with significant wildfire exposure, unusual construction features, previous major losses, or other characteristics that make coverage difficult to get through the traditional market.
How surplus lines insurers differ from standard insurance companies
Surplus lines insurers aren’t licensed in the same way as standard insurance companies, also called “admitted” carriers. Surplus carriers operate under Arizona’s surplus lines laws and regulatory requirements. Because E&S insurers are willing to issue policies for homes with greater, more unique risks, coverage is typically more expensive and may come with higher deductibles (the portion of a covered loss that comes out of your pocket, not your insurer's).
The Arizona DIFI maintains a public list of insurers willing to cover homes in higher wildfire-risk and wildland-urban interface (WUI) areas — regions where homes sit close to undeveloped, fire-prone land. This list is a helpful starting point, but it's not a guarantee of coverage. Not every insurer on it sells policies in every part of the state, so availability still depends on your specific location.
Pro tip: You’ll likely need to work with a licensed insurance agent to find a surplus lines insurer willing to issue policies where you live. These policies aren’t typically sold directly to homeowners.
What does a surplus lines or high-risk property policy typically cover?
Coverage varies widely between surplus lines insurers, but the key point for Arizona homeowners is that coverage is offered in high-risk parts of the Grand Canyon State that traditional insurers no longer serve.
That said, many surplus lines policies provide narrower financial protection than a standard home insurance policy. Here's how the two typically compare:
|
Coverage type |
Standard policy |
Surplus lines policy |
|
Structure of your home |
Covered |
Covered |
|
Personal belongings |
Covered |
Often limited or excluded |
|
Personal liability |
Covered |
Often limited or excluded |
|
What causes of damage are covered |
Most causes of damage, unless specifically excluded |
Only the specific causes listed in the policy, such as fire, lightning, or wind |
When working with an agent, make sure to specifically ask about Arizona wildfire coverage, since some surplus lines policies exclude it or only offer it as an optional add-on (called an endorsement). More broadly, a good agent should help you understand:
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Whether wildfires are covered
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What other types of damage may be excluded
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What deductibles apply and how much they are
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Whether personal property and liability coverage are offered
Rates for surplus lines insurance are notably high, but it’s hard to pin down an exact cost. Policy costs will vary dramatically depending on your ZIP code and home value. That said, E&S policies are often $5,000 to $10,000 a year, or even higher.
Why is coverage hard to find in parts of Arizona?
Home insurance in Arizona is becoming increasingly harder to find and more expensive for homeowners throughout the state. This trend is primarily led by the state’s major wildfire risk — especially in forested regions, wildland-urban interface areas, and desert regions.
According to the 2025 Verisk Wildfire Risk Report, all Arizona homes and commercial structures face some level of wildfire risk: 20.21% are considered moderate risk and 2.30% are considered extreme risk. What’s worse, floods often follow fires, adding to homes’ risk exposure.
Wind and the resulting dust storms, called haboobs, are also a major threat. According to Disaster Aware, Arizona’s high wind risk is considered extreme, with a score of 9 out of 10. Wind, hail, and flooding pose heightened risks during Arizona’s monsoon season.
Arizona’s insurance market is also affected by rising construction costs and increased severity of property claims.
In 2025, the Arizona legislature passed House Bill 2054, establishing the Fire Insurance Review Task Force to study wildfire-related insurance challenges and recommend ways to improve insurance availability and affordability in the state. As part of that effort, DIFI launched a wildfire insurance data call for 2025 and 2026, requiring insurers to provide information about wildfire exposure, underwriting, rates, consumer complaints, cancellations, and nonrenewals. Together, the Task Force and the data call are intended to give state officials a clearer picture of Arizona’s homeowners insurance market and help inform future policy decisions.
Also in 2025, DIFI’s Resiliency and Mitigation Council released a detailed report examining why homeowners insurance has become harder to find in Arizona’s wildfire-prone areas. The report offers various ways homeowners, communities, insurers, and policymakers can reduce wildfire risk and improve long-term insurance access.
How to lower the cost of high-risk home insurance in Arizona
You may be able to lower the cost of your Arizona homeowners insurance — even if you live in a high-risk area. Here are some strategies.
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Invest in wildfire mitigation: Creating defensible space around your home, removing combustible materials near any structures on your property, and using ignition-resistant roofing and siding can reduce your home’s wildfire risk. You may qualify for homeowners insurance discounts for mitigating wildfire threats. In fact, if your community takes certain mitigation actions and receives a Firewise USA designation from the National Fire Protection Association, everyone in the region could potentially qualify for discounts.
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Work with an independent insurance agent: Independent agents should be able to compare multiple admitted insurers and surplus lines options for you and find you the lowest-cost policy with adequate coverage.
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Bundle home and auto coverage: Many insurers offer multipolicy discounts for bundling your home and auto insurance policies.
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Review coverage annually: Insurance availability and pricing can change quickly in high-risk areas. Check your options each year, especially if you currently have surplus lines coverage but have taken steps to reduce your risk of wildfire damage — you may eventually qualify for a standard policy.
Frequently asked questions
What is the cheapest homeowners insurance in Arizona?
The cheapest homeowners insurance in Arizona depends on where you live, the value of your home, and the coverages you want. Your best bet to find cheap Arizona homeowners insurance is to shop around and get personalized quotes. If you live in a high-risk wildfire area and don’t qualify for traditional coverage, working with an independent agent to find surplus lines coverage may be your only option.
How much is home insurance on a $500,000 house in Arizona?
On average, home insurance* in Arizona costs $1,279 per year for a Kin policy with $500,000 in dwelling coverage. However, if you live in a high-risk, wildfire-prone part of Arizona, you’ll likely pay much more.
Is FAIR Plan insurance good?
FAIR Plans are a last-resort insurance option for homeowners in many states. The coverage is usually more limited and more expensive than traditional home insurance, but for some homeowners, it may be the only option.
What does a FAIR Plan typically not cover in Arizona?
Arizona doesn’t have a FAIR Plan, but many other states do operate FAIR Plans as insurers of last resort. Much like Arizona’s surplus lines policies, FAIR Plans tend to be more limited in coverage and cost more than standard home insurance.
Depending on the state program, common limitations include:
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No or limited liability coverage
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Lower personal property limits, if available
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Coverage for only specific, listed causes of damage, rather than broader protection against most causes unless explicitly excluded
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Limited optional endorsements
