Allstate Accused of Racial Discrimination Over Flat Roofs

Mortgage & Real Estate

The National Fair Housing Alliance has filed a federal housing discrimination complaint against Allstate Insurance Co. alleging its “no flat roofs” insurance policy discriminates against people of color.

Filed with the Department of Housing and Urban Development, the complaint states the insurer’s “redlining practices in providing residential hazard insurance” in the Wilmington, Del., area are discriminatory.

The National Fair Housing Alliance alleges that representatives from Allstate agencies in the area told NFHA investigators Allstate “does not provide policies” for flat-roofed homes.

And according to NFHA, the insurer’s no flat roofs policy “has a racially disparate impact” on homeowners of color “who are significantly more likely to live in areas with a concentration of homes with flat roofs.”

These allegations resulted from an in-depth investigation over suspicions that Allstate would refuse to underwrite insurance policies for homeowners whose properties have flat roofs, NFHA said, which violates the Fair Housing Act.

“African-American homeowners deserve access to home insurance policies,” continued Smith of the National Fair Housing Alliance. “There is no legitimate business justification for the no flat roofs policy,” which unnecessarily denies insurance coverage for African-American homeowners living in and around Wilmington, said Shanna L. Smith, president and CEO of NFHA, in a company release.

Smith called on Allstate, one of the country’s largest insurers, to refrain from creating underwriting policies “that limit or deny homeowners insurance to communities of color,” and honor a conciliation agreement with NFHA and HUD it entered in 1997 to eliminate discriminatory policies that denied replacement coverage for homes because of the age or value of the home, or race.

“We have not yet had the opportunity to review the National Fair Housing Alliance’s filing,” noted Chris Bauer, Allstate’s corporate relations representative, in an email to this  publication. “However, we can categorically state that Allstate does not discriminate in the writing of Allstate homeowners products on the basis of an applicant’s race.”

On its website Allstate explains that the same as homes, landscapes and climates, its homeowners insurance options differ from state to state. Homeowners are advised to review local insurance details so they get the appropriate coverage.

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