THE GENERAL ACCOUNTING OFFICE, IN RESPONDING TO A CONGRESSIONAL REQUEST, ASSESSED THE ADEQUACY OF FEDERAL PROGRAMS DEALING WITH THE DETECTION, INVESTIGATION, AND PROSECUTION OF ARSON OFFENSES AND THE EFFECTIVENESS OF FAIR ACCESS TO INSURANCE REQUIREMENTS PLANS IN MINIMIZING THE ARSON-RELATED INSURANCE FRAUD PROBLEM. INTERVIEWS WERE CONDUCTED WITH OFFICIALS, AND WRITTEN INFORMATION WAS OBTAINED FROM THE FEDERAL INSURANCE ADMINISTRATION, THE NATIONAL FIRE PREVENTION AND CONTROL ADMINISTRATION, NINE FAIR ACCESS TO INSURANCE REQUIREMENTS PLANS (DELAWARE, THE DISTRICT OF COLUMBIA, ILLINOIS, MARYLAND, MASSACHUSETTS, NEW YORK, PENNSYLVANIA, RHODE ISLAND, AND WASHINGTON), SIX INSURANCE COMPANIES, AND TWO INSURANCE INDUSTRY TRADE ASSOCIATIONS. FINDINGS INDICATE THAT THE AMOUNT OF COVERAGE PROVIDED BY STATE PLANS VARIES. SOME PLANS BASE THE AMOUNT OF COVERAGE GIVEN TO A PROPERTY OWNER ON THE MARKET VALUE OF THE PROPERTY USING SUCH VALUES AS THE OWNER'S PURCHASE PRICE. ALTHOUGH PLANS CAN REFUSE TO INSURE FOR THE FULL AMOUNT REQUESTED, THREE OF THE NINE INVESTIGATED DO NOT. OF THE NINE PLANS, SIX REFUSE TO INSURE FOR THE FULL AMOUNT REQUESTED IF IT IS MORE THAN THE PROPERTY VALUE AS DETERMINED BY THE PLAN. ALL PLANS CAN REFUSE COVERAGE ALTOGETHER, BUT THERE ARE LIMITED REASONS FOR REFUSING. GENERALLY, DEPRECIATION (DETERIORATION) IS CONSIDERED IN PAYING CLAIMS. IN FOUR STATES, THE BASIS USED FOR DETERMINING THE AMOUNT TO PAY UNDER A CLAIM IS THE PROPERTY'S ACTUAL CASH VALUE AT THE TIME OF LOSS; ACTUAL CASH VALUE IS DEFINED AS REPLACEMENT COST LESS DEPRECIATION. THE FEDERAL RIOT INSURANCE PROGRAM PROVIDES PRIVATE INSURANCE COMPANIES WITH INSURANCE TO PROTECT THEM DURING RIOTS AGAINST EXCESS LOSSES ON COMPANY-INSURED PROPERTIES. TO PURCHASE RIOT REINSURANCE, A COMPANY MUST BE PARTICIPATING IN A FAIR ACCESS TO INSURANCE REQUIREMENTS PLAN. BOTH PLAN AND INSURANCE INDUSTRY OFFICIALS BELIEVE THAT ARSON FOR PROFIT IS A SERIOUS PROBLEM IN PLANS AND IN THE PRIVATE INSURANCE MARKET. ONE OF THE MAJOR INCENTIVES FOR ARSON OFFENSES IS OVERINSURANCE, PROVIDING AN AMOUNT OF INSURANCE EXCEEDING PROPERTY MARKET VALUE. PLANS NEED GREATER UNDERWRITING AUTHORITY TO DENY OR LIMIT INSURANCE COVERAGE TO HIGH-RISK PROPERTY OWNERS. DETAILED RESULTS OF THE GENERAL ACCOUNTING OFFICE REVIEW, A LIST OF ORGANIZATIONS CONTACTED DURING THE COURSE OF THE REVIEW, AND DATA ON PLANS ARE APPENDED.