The FAIR Plan does not cover water damage, theft, or liability.

It is a fire policy, and that answers most of the question

The FAIR Plan writes a fire policy, not a homeowners policy. It was built to insure the one type of damage the rest of the market was stepping away from, and it does that job. It was never built to replace everything else your old policy did.

So for the three things homeowners ask about most, water damage, theft, and liability, the answer is no. These are not hidden clauses buried in fine print somewhere. They are simply not part of what this policy is.

That is better to know plainly now than to discover during a claim. It is also fixable, and the rest of this page is about how.

casa.insure is independent of the California FAIR Plan. This is not the Plan's official site; the Plan itself is at cfpnet.com.

What it does cover

A FAIR Plan policy covers fire and smoke. If your home burns, that is the policy that responds, up to the coverage amount printed on your declarations page.

Wind and hail can be covered, but only if you add it. It is not included by default. Check your paperwork instead of assuming. Some homeowners have it and some do not, and most people cannot say which they are.

There are a few limited extras beyond that, and they vary by policy. The short version: this is fire coverage with a few additions. Most of what you think of as normal home insurance lives somewhere else.

What each missing piece would have paid for

Coverage stays abstract until you attach it to an ordinary bad day at a house. Here is what each of these pieces is actually for.

None of these are rare events. Water damage and theft are among the most common claims homeowners file. Liability is one of the least expensive parts of a homeowners policy to carry, and the most expensive thing to be missing.

• Water damage: the supply line behind the washing machine fails while you are at work, or the water heater gives out. The flooring, the drywall, and the lower cabinets all come out. A fire policy pays for none of it.
• Theft: the bikes disappear from the garage, or the laptops and jewelry from the house. Under a fire policy, replacing your belongings is your own money.
• Liability: a visitor slips on your front steps and breaks a wrist. The medical bills, and anything claimed against you afterward, land on you. This is the one risk with no natural ceiling, which is why it matters most.
• A place to stay: while the home is being repaired or rebuilt, you are paying for a rental or a hotel, plus meals, on top of the mortgage. The Plan offers only a limited version of this, so it is usually a gap, even when it is not a full zero.

The wrap that puts them back

There is a standard fix: a second policy. Insurers call it a DIC policy, for difference in conditions. Most homeowners just call it the wrap. It sits alongside the FAIR Plan fire policy and covers the difference: liability, water damage, theft, and living costs while you rebuild.

A FAIR Plan policy with no wrap next to it leaves you carrying risks most homeowners would not choose to carry. If you have a mortgage, your servicer may expect to see the pair anyway, and will keep sending letters until it does.

The honest catch is that two policies mean two prices, two renewal dates, and two claims paths. Add both yearly prices together before you decide anything. A FAIR Plan price on its own is only half the number, and it is the half that looks better.

How to find out what you actually have right now

Do not go by memory or by what someone told you on the phone. Pull your declarations page, the short summary at the front of the policy packet. Everything below is on it.

Find the list of covered types of damage, sometimes labeled covered causes of loss. A fire policy names fire and smoke, and names wind and hail only if you bought them. Then look for four line items: liability, personal property or contents, a place to stay while you rebuild (sometimes called additional living expense), and water damage. Blank, zero, or absent means you do not have it.

Then ask in writing. Email your agent and ask them to confirm what your current setup covers, what it does not, and whether a wrap policy is in place. Email creates a record, and a record is what you want if there is ever a disagreement later about what you were told.