About the Alabama Insurance Underwriting Association
The Alabama Insurance Underwriting Association (AIUA) was voluntarily formed in the early 1970's by Insurance Industry leaders in co-operation with the Alabama Department of Insurance. In 2008, the Alabama legislature codified AIUA along with its articles of agreement, plan of operation, and rules and procedures.
The mission of Alabama Insurance Underwriting Association (AIUA) is to provide a market for owners of eligible property located in coastal areas of Baldwin and Mobile counties to obtain essential insurance when they are unable to obtain coverage in the private insurance market. AIUA has successfully and efficiently served this mission for more than 40 years.
By design, AIUA policies provide basic, no frills, coverage at rates that are generally higher than the average rates offered in the private market for a policy providing broad coverage options. Typically, a property owner will seek an AIUA policy as a "last resort" because they have been unable to find better coverage at lower rates elsewhere.
Several factors including the average annual loss ("routine", non-storm losses), the Probable Maximum Loss (PML) that can be expected in the event of a catastrophic loss (several different modeling algorithms are used in this process), and the routine operating expense of the AIUA, are used by independent actuaries to determine an actuarially sound rate sufficient to cover the cost of AIUA operating expenses, routine claims and the cost of purchasing reinsurance. These rates are then filed with the Alabama Department of Insurance where they are carefully analyzed by the Department before they are approved and implemented.
AIUA offers several deductible options, including higher deductible options which may reduce annual premiums substantially. AIUA also offers hefty premium discounts to property owners who build new homes to "fortified" standards or install (wind) loss mitigation features, such as hurricane wind resistive shingles, roof straps, impact resistant doors, windows and shudders etc… to their existing homes.
When considering your property insurance needs, find a professional insurance agent with access to known, reputable insurance markets. Make sure your property is well-maintained and in insurable condition. Where feasible, retrofit your home to include wind loss mitigation features. Don't wait until the last minute to obtain coverage. Read your policy and all policy documentation carefully. Consider higher deductible options. Don't "low-ball" your coverage limit…it almost always costs more to repair or replace a home than most people plan for…Buy flood insurance equal to your fire and wind coverage. Most of the damage incurred during recent hurricanes was caused by flood, not wind. And remember, flood is NOT COVERED under most property policies including AIUA policies.