The study, conducted in New York City and Phoenix, was commissioned by the U.S. Department of Housing and Urban Development and was conducted by the Urban Institute in Washington, D.C. Galster, who is the Clarence Hilberry professor of urban affairs in WSU's College of Urban, Labor and Metropolitan Affairs, is former director of housing research for the institute.
The pilot study was undertaken to determine if neighborhood-based discrimination by insurance agents plays a role in higher homeowner policy rates and less coverage in minority neighborhoods. Findings suggest that discrimination is probably not a major explanation for these patterns, which were pointed up by earlier studies.
"These results are good news, " Galster said. But he added that "they should not be interpreted as a clean bill of health for the insurance industry." He pointed out that the study did not investigate other aspects of the home insurance process, such as policy underwriting, design of rating territories, claims adjustment procedures and cancellation provisions.
More studies are needed, the WSU professor said, to determine if the findings hold true for lower-income neighborhoods in other cities, such as Detroit.