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Monday, November 24, 1997

Program to help find insurance gets low response

DALLAS (AP) - The state is rethinking a program intended to help homeowners fight insurance discrimination in the Dallas-Fort Worth area after a noticeable lack of interest.

The program was set up by The Texas Department of Insurance to combat the practice of denying insurance in poor, old or minority neighborhoods.

The department expected applications from thousands of homeowners. But in the first year, fewer than a dozen policies have been issued in the 427 designated ZIP codes that the program targets, state officials said.

"I have been very disappointed in the response," said state Insurance Commissioner Elton Bomer, who recently overhauled the Market Assistance Program to try to boost participation.

"We have tried really hard to make it successful, and we are going to continue to try," he said, calling the number of MAP insurance applications so far "dismally low."

Critics of the plan, mostly insurance industry representatives, said the lack of activity shows homeowners are not having trouble finding coverage.

Further, they said, the results call into question accusations of widespread redlining by insurance companies that sell homeowners' coverage.

"You might say it was a failure because so few people used the program. But on the other hand, you could say it is fortunate that we don't have the problem we thought we had," said Rick Gentry of the Texas Insurance Organization, an association of small- and medium-size insurers.

Consumer representatives said the assistance program is failing because it is voluntary, and most companies don't actively participate.

"The MAP program is not working because it did not change insurance company practices," said Rob Schneider of Consumers Union. "A company can still refuse to sell you a policy because of your occupation, credit history, income level or a variety of other reasons."

The program was created last fall under a law that the legislature passed in 1995. Most Dallas and Fort Worth neighborhoods were declared eligible.

Bomer said his office received numerous complaints about the lack of insurance availability from homeowners in North Texas before the program began.Send a Letter to the Editor about This Story | Start or Join A Discussion about This Story
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