Civil Rights Organization Files Federal Fair Housing Act Lawsuit Against Travelers Insurance Alleging Insurance Discrimination
Washington, DC – Today, the National Fair Housing Alliance (NFHA) announced the filing of a federal lawsuit alleging race, sex, and source of income discrimination against Travelers Indemnity Company (Travelers) for failing to provide habitational insurance to apartment owners who rent to tenants who participate in the Housing Choice Voucher (HCV) program. This lawsuit is the result of an investigation by NFHA that uncovered this discriminatory business practice. The denial of insurance coverage because tenants subsidize their rental payments with Housing Choice Vouchers is a violation of the Fair Housing Act and the District of Columbia Human Rights Act because it has a disproportionate adverse impact on African Americans and female-headed households in Washington, D.C.
Travelers’ business practices were discovered by NFHA’s investigators, who contacted five independent insurance agencies that market and underwrite Travelers insurance policies in the D.C. area. The investigators sought insurance coverage for multi-family apartment buildings located in Southeast Washington, D.C. When the investigators mentioned that the tenants participate in the Housing Choice Voucher program, often referred to as “Section 8,” every investigator was told that Travelers does not provide habitational insurance to apartment owners who rent to tenants using Section 8. The investigators were told to seek coverage from other insurance companies. Evidence gathered over ten months documented this ongoing pattern and practice of discrimination on the part of Travelers.
Participants in the Housing Choice Voucher program use vouchers to find their own housing in the private rental market, including single family homes, townhouses and apartments. Participants are free to choose any housing that meets the program’s requirements. A housing subsidy is paid to the landlord directly by the local housing authority on behalf of the participant. The participant then pays the difference between the actual rent charged by the landlord and the amount subsidized by the program. The HCV program gives families, seniors, people with disabilities and individuals the opportunity to find decent, safe and sanitary housing. On average, D.C. residents using HCV pay approximately 30 percent of their household income for rent, and the D.C. Housing Authority pays the rest of the rent directly to the landlord.
Travelers’ alleged practices and underwriting guidelines have a discriminatory impact on the District’s most vulnerable households. Travelers’ policies disproportionately harm African Americans and women and deter apartment owners who want to help house low-income families in Washington, D.C.
African American households make up 92 percent of Housing Choice Voucher participants in Washington, DC, although they are just are 45.2 percent of all households in the District. Female-headed households make up 82 percent of Housing Choice Voucher participants in Washington, DC, but only 47 percent of all households in the District.
“It is already very difficult to find affordable housing in Washington, D.C., and Travelers exacerbates that problem by denying insurance coverage to apartment owners who rent to tenants who participate in the HCV program. This program is funded by Congress to increase housing choice in neighborhoods across the District of Columbia and the nation. Travelers has effectively reduced the opportunity for families to exercise neighborhood choice,” said Shanna L. Smith, President and CEO of the National Fair Housing Alliance.
Ms. Smith added, “This lawsuit should not take Travelers by surprise. Travelers has known since at least 2013 that denying insurance to apartment owners simply because some tenants use Housing Choice Vouchers violates fair housing laws. NFHA member Project Sentinel, and apartment owners who rented to tenants using government subsidies, sued Travelers in federal district court in San Jose, California, in 2013. The parties reached a confidential settlement in July 2015 after the judge denied Travelers’ motion for summary judgment and after the U.S. Supreme Court upheld disparate impact as cognizable under the Fair Housing Act. Yet, Travelers continues to utilize this discriminatory policy in the District of Columbia.
NFHA is represented by Relman, Dane & Colfax PLLC, a civil rights law firm based in Washington, D.C.
A copy of the complaint is available here.
The PowerPoint can be accessed on the NFHA website after the news conference has concluded.
The National Fair Housing Alliance
Founded in 1988, the National Fair Housing Alliance is a consortium of more than 220 private, non-profit fair housing organizations, state and local civil rights agencies, and individuals from throughout the United States. Headquartered in Washington, D.C., the National Fair Housing Alliance, through comprehensive education, advocacy, and enforcement programs, provides equal access to apartments, houses, mortgage loans, and insurance policies for all residents in the nation.
The work that provided the basis for this investigation was supported, in part, by funding under a grant from the U.S. Department of Housing and Urban Development. The substance and findings of the work are dedicated to the public. The author and publisher are solely responsible for the accuracy of the statements and interpretations contained in this release. Such interpretations do not necessarily reflect the views of the Federal Government.
