2.1 Georgia Homeowners Insurance Requirements

The Georgia Underwriting Association (FAIR Plan)

Georgia has no coastal wind pool separate from its FAIR Plan (Fair Access to Insurance Requirements). The Georgia Underwriting Association (GUA), created under OCGA Title 33, Chapter 33, is the insurer of last resort. Every admitted property insurer doing business in Georgia must belong to the GUA and shares in its profits and losses in proportion to market share — a candidate is tested on the idea that the residual market is funded by the industry, not by the state's general fund.

The GUA exists to make essential property insurance available to applicants who cannot buy it in the voluntary market. It does not compete with admitted carriers; eligibility hinges on a documented declination.

What the GUA writes

The statutorily defined Windstorm and Hail Area is the six coastal counties: Bryan, Camden, Chatham, Glynn, Liberty, and McIntosh, plus barrier islands such as Tybee, St. Simons, Jekyll, and Sea Island. A common exam distractor adds Effingham or Lowndes — those are inland and are NOT in the wind area.

Exam Tip: Georgia uses ONE residual mechanism (the GUA/FAIR Plan) for both inland fire risks and coastal wind. It is not a separate "Beach Plan" like Florida's Citizens or Texas TWIA, even though the GUA's coastal wind product functions similarly.

GUA eligibility and limits

To place a risk in the GUA the producer must show the property could not be insured voluntarily:

1. Declination — the property must have been declined by the admitted market; the application documents the carriers contacted.
2. Insurable interest and condition — the property cannot be vacant beyond plan limits, condemned, or in violation of building/fire codes; an inspection may be ordered.
3. Loss-mitigation conditions — coastal risks must meet wind-resistive construction standards; brush risks may need defensible space.
4. Maximum limits — the GUA caps dwelling coverage (the plan's per-risk maximum is set in its Plan of Operation and adjusted by directive), so jumbo coastal homes still need surplus lines.
5. Premium — GUA rates run materially higher than the voluntary market and are not negotiable.

The GUA also enforces a Hurricane Underwriting Restriction: when the National Hurricane Center posts a watch/warning for the area, the GUA suspends new coastal binding until the storm clears. Producers cannot bind a beach risk the day a storm is approaching.

Cancellation and Nonrenewal (OCGA 33-24-44 / 33-24-46)

Georgia property policies in force 60+ days enjoy strong continuation rights.

After 60 days a policy may be cancelled mid-term ONLY for limited grounds: nonpayment, material misrepresentation/fraud, a substantial change in the risk that increases the hazard, or a violation of policy terms. An insurer cannot cancel a seasoned policy simply because it no longer likes the risk — that must wait for nonrenewal at expiration. The insured may request the Commissioner review a cancellation or nonrenewal within 15 days of receiving notice.

Hurricane Deductibles and Flood

Georgia permits separate named-storm / hurricane deductibles, usually a percentage of Coverage A (the dwelling limit):

• Percentage options of 1%, 2%, or 5% — on a $300,000 home a 2% wind deductible is $6,000, far higher than a $1,000 all-other-perils deductible.
• The hurricane deductible must be separately and conspicuously disclosed, with a trigger (e.g., a named storm declared by the NHC) and the insured's written acknowledgment.

Flood is always excluded from standard HO and dwelling forms. Producers must disclose this and direct buyers to the National Flood Insurance Program (NFIP) or growing private flood market — failing to disclose the flood exclusion is a frequent E&O claim.

Worked Example and Common Traps

Consider a $300,000 dwelling (Coverage A) on St. Simons Island declined by three admitted carriers. The producer documents the declinations, applies to the GUA, and the home passes a wind inspection. The policy carries an all-perils deductible of $1,000 and a 2% hurricane deductible of $6,000. If a named storm causes $40,000 of wind damage, the insured absorbs the $6,000 hurricane deductible (not the $1,000 figure) and the GUA pays $34,000 — students routinely apply the wrong deductible here.

Watch these recurring exam traps:

• Notice math: nonpayment cancellation is 10 days, NOT 30; nonrenewal is 30 days, NOT 45. The old "45-day" figure is a frequent distractor and is incorrect under current Georgia law.
• County list: only the six coastal counties (Bryan, Camden, Chatham, Glynn, Liberty, McIntosh) are in the Windstorm and Hail Area; Effingham, Lowndes, and Ware are inland traps.
• Mid-term cancellation after 60 days is limited to nonpayment, fraud/material misrepresentation, substantial increase in hazard, or policy-term violation — "the underwriter changed its appetite" is NOT a valid mid-term reason.
• Flood vs. wind: the GUA writes wind/hail; it does NOT write flood. Storm surge is flood and goes to the NFIP.

Producers should also remember the GUA is funded by member insurers, so its solvency does not depend on state appropriations, and that the Hurricane Underwriting Restriction freezes new coastal binding once the National Hurricane Center posts a watch or warning.