Three Baltimore Insurance Brokers file Complaint Accusing Erie Insurance of Discriminating Against Black Customers

Three Baltimore-area insurance brokers have filed complaints with the Maryland Insurance Administration accusing Erie Insurance of racially discriminating by engaging in insurance redlining of predominantly Black neighborhoods in the city.

Two of the three brokerage firms are Black-owned small businesses. They filed separate complaints this week with the Maryland Insurance Administration, the state regulator. The companies included Baltimore Insurance Network LLC of Bowie, Ross Insurance Agency of Windsor Mill, and Welsch Insurance Group of Baltimore, which all contract or had contracted with Erie as agents to sell policies.

The brokers accuse Erie, which underwrites policies sold by the firms, of redlining - the practice of denying services to residents of certain neighborhoods based on race or ethnicity. The complaints say Erie refused to underwrite policies based on a potential client’s race, ethnic origin, neighborhood, and/or socioeconomic status.

“Erie Insurance brokerages that serve Baltimore, and in particular that serve the poor areas of Baltimore which are predominately African American, are being told that even when customers meet their underwriting standards and when they would otherwise qualify, Erie is not interested in certain customers,” said Cary J. Hansel, an attorney for Baltimore Insurance.

Both Baltimore Insurance and Welsch said in their complaints that Erie urged them to not sell policies to people in Baltimore with “city sounding names.” Baltimore Insurance Network said it was told by an Erie branch manager to “place those people elsewhere, I don’t care where, just not with Erie. They don’t fit Erie’s appetite. Find better people.”

A spokesperson for Erie said Wednesday that the company has not yet been formally notified of the filings but will address any complaints with the Insurance Administration. The company said it does not comment publicly on specific customers, agents, claims, or regulatory filings.

Previously, Erie has been sued for redlining in New York State as well as found to have higher auto insurance premiums not associated with risk for Illinois minority zip codes in a 2017 study by Pro Publica. 

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Source: Baltimore Sun, January 13, 2021.