BOSTON- On Friday, October 10, 2014, Governor Deval Patrick signed into law legislation regarding the Fair Access to Insurance Requirements or the FAIR Plan. The bill was sponsored by Senator Michael O. Moore (D-Millbury) and was supported by the Massachusetts Association of Insurance Agents (MAIA).
“The signing of this bill into law will help owners, particularly in urban and coastal areas, where properties cannot be insured in the standard voluntary market. Currently, owners who seek liability insurance must access insurance through the open market which can be costly,” stated Senator Moore. “This law will provide owners and tenants alike peace of mind knowing the property is properly insured.”
Dan Foley, the Vice President of Government Affairs & General Counsel for MAIA said, “This legislation expands the coverage available through the FAIR Plan by requiring that liability insurance coverage be offered on a non-owner occupied dwelling policy for residential dwellings of 1 to 4 units. These are insurance policies that cover property or owners who don’t live on the premises. This new law provides important liability protection for property owners, while at the same time saving them 3 to 4 times the cost of purchasing a separate liability insurance policy in the Excess & Surplus Lines market. The bottom line is that when the law becomes effective on January 8, 2015, the non-owner occupied insurance policy will now provide coverage for the property in addition to providing the much needed liability protection all under one insurance policy.”
This legislation expands the coverage available through the FAIR Plan by requiring that liability coverage be offered to non-owner occupied residential dwellings of 1 to 4 units.
Currently, there is no access in the standard insurance market to purchase and secure Personal Liability insurance. Property owners are then forced to go out to the Surplus and Excess Markets to purchase a separate liability policy, which is 3 to 4 times more costly.
The law will become effective on January 8, 2015.