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Redlining
In 1997, CEJ issued a report conclusively
establishing that Texas auto insurers
force Texans in low income and minority communities to buy higher-priced policies to
comply with mandatory insurance laws. Our follow-up report identified the insurers with the worst
records. In response to our second report, the Department initiated investigations of
some of the companies we identified. In addition, Vickie Benitez testified about the use of underwriting guidelines to redline
at the National Association of Insurance Commissioners in December, 1998.
Insurers have reacted to our studies by filing
lawsuits to suppress all releases of insurance availability data. Numerous state senators
and representatives are requesting that data to investigate insurance redlining.
QMR data is Zip Code level information,
including the number of vehicles insured by Zip Code, that each auto insurer must file
with the Department every calendar quarter. CEJ and its economist Birny Birnbaum requested the "Quarterly Market Report"
(QMR) data from the Department of Insurance. This information is critical for identifying insurers that
are redlining low income or minority neighborhoods. When the Department of Insurance ruled
that it would release the information, the insurers sued to enjoin the Department from
doing so.
A wide range of interests has identified the importance of the public release of this
information. The Insurance Commissioner stated that public release of this information is
"essential for the public to hold both regulators and insurers accountable." The
Court of Appeals said that this information will "ensure that there is not a negative
correlation between a community's minority population and the availability of automobile
insurance." Several Texas papers, including the Houston Chronicle, Dallas
Morning News, and Austin American Statesman have issued editorials calling
for the public release of this information.
Additional information includes a press release on
the rate increase of TAIPA, often a
last-resort auto insurer. Detailed testimony on a TAIPA rate hearing is available as pdf
file. Finally, a press release points the finger at specific companies on their records of
discrimination. |