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HUD COMMENDS SETTLEMENT OF
WASHINGTON -- The U.S. Department of Housing and Urban Development (HUD) today commended the U.S. Department of Justice and the Nationwide Insurance Company on the resolution of fair housing complaints filed against the company by the National Fair Housing Alliance (NFHA).
As in complaints brought by NFHA against Allstate and State Farm Insurance, which were settled with HUD, Nationwide has agreed to make changes to its eligibility guidelines that will increase the availability of homeowners insurance to all Americans. These three companies insure close to 40% of the homeowners insurance market.
"I commend the Justice Department and Nationwide for reaching this agreement," said Housing Secretary Andrew Cuomo. "This settlement will increase the availability of insurance in urban areas, encourage investment in our cities, and make the dream of homeownership a reality for many more Americans."
The complaints against Nationwide, originally filed with HUD under the Fair Housing Act, resulted from testing performed by private fair housing groups funded through HUD enforcement programs. These tests showed that individuals living in minority neighborhoods were less likely to receive insurance quotations; and when they did receive quotes, a higher percentage of them -- when compared to similar homes in white neighborhoods -- did not include replacement cost coverage.
This agreement, similar to HUD's conciliations between NFHA and State Farm and Allstate, eliminates eligibility guidelines that denied insurance to a dwelling if it was older than the maximum age or had too low a market value. The new guidelines also make replacement cost policies available to many who have been denied such policies in the past.
Susan Forward, HUD's Deputy Assistant Secretary for Enforcement and Investigations, said, "The Nationwide settlement is the third major property insurance settlement within the past year."
"Together with previous settlements from Allstate and State Farm, Nationwide's commitment to no more business-as-usual guarantees that more insurance opportunities will be available to all Americans, increasing homeownership and strengthening communities," Forward continued. "This is another example of how the Fair Housing Act works to benefit all Americans."
Content Archived: January 20, 2009