Massachusetts Property Insurance Underwriting Association

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 nations 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.