This report examines the questions concerning redlining, or unfair discrimination, in Texas' homeowners insurance market. Consumer advocates claim that insurers use discriminatory underlines that preclude low-income, minority homeowners from accessing homeowners insurance coverage. The use of these guidelines has a disparate impact on minority neighborhoods. Insurers counter-argue that the perceived disparate impact is no fault of their own. Rather, they argue that problems of high risk within minority neighborhoods, an un-educated consumer population, and market failure are the reasons for the low level of insurance coverage within low-income, minority neighborhoods. The Market Assistance Program, which is the state of Texas' effort to improve the availability of homeowners insurance within traditionally underserved areas, continues to suffer from a lackluster response.
