FAIR Plans are the outgrowth of the national emergency created by three years of rioting in American
cities, beginning with the Watts outbreak in 1965. When the rioting of the 1960s suddenly
mushroomed to disastrous proportions, the companies found themselves in the position of having to
pay losses in excess of $100 million, on which they had collected no specific premium. Although the
companies paid these losses, their capacity was severely taxed and their normal riot reinsurance
market had dried up. It became obvious that emergency revisions of underwriting and reinsurance
procedures were necessary for the future protection of urban property and urban existence.
A national advisory panel appointed by President Johnson warned that the
revitalization of the nation's cities would be impossible without fair access to property insurance.
It then set forth its recommendations to provide federal riot reinsurance to companies writing in
riot prone states if FAIR Plans (Fair Access to Insurance Requirements) were established to resolve
the availability of insurance protection in urban areas.
Congress enacted the Urban Property Protection and Reinsurance Act of 1968,
which authorized the establishment of FAIR Plans and made available federal riot reinsurance to the
companies. The Massachusetts Legislature responded with the enactment of chapter 731 of the Acts of
1968, which formed the Massachusetts Property Insurance Underwriting Association under regulatory
supervision of the Massachusetts Insurance Department. The Commissioner of Insurance further
designated the entire commonwealth an "Urban Area," with the result that FAIR Plan coverage is
available on a statewide basis.
The Massachusetts Property Insurance Underwriting Association (MPIUA) is a residual market insurance association in which all
companies writing basic property insurance in the Commonwealth are required to participate
with losses shared among the member companies on a premium volume basis. Responding
to Federal Legislation, the Massachusetts Legislature in 1968 called for an urban
area insurance placement facility and thereby gave rise to MPIUA. MPIUA is
also known as FAIR Plan (Fair Access to Insurance Requirements). The FAIR Plan
operates similar to that of a normal insurance company in that it underwrites and
inspects risks, accepts premium, issues policies and adjusts claims. It has
a seasoned professional staff, which provides exceptional service to its clientele.
The Association secures its authority to operate from Massachusetts General Law,
Chapter 175 C, Urban Area Placement Facility. The purposes of the Association are as follow:
1. To make basic property insurance more readily available to all eligible applicants
who have been unable to secure such insurance in the voluntary insurance market.
2. To equitably apportion and distribute the writings, expenses, profits, if any, and
losses of the Association among insurers licensed to write basic property
insurance in the Commonwealth.
Massachusetts General Law Chapter 175c - Urban Area Placement Facility. Massachusetts State Law that established the
Massachusetts Property Insurance Underwriting Association (MPIUA).
The Plan of Operation - Outlines the operational Purpose and Standards of the Massachusetts Property Insurance
Underwriting Association (MPIUA), as approved by the Commissioner of Insurance.
The Constitution of MPIUA - Defines the rights and responsibilities of member insurance companies of the
Massachusetts Property Insurance Underwriting Association as required by law.