Fairness in Disparity: Challenging the Application of Disparate Impact Theory in Fair Housing Claims Against Insurers

Matthew Jordan Cochran

Abstract

This article responds to courts and commentators that have expressed willingness to apply the familiar "disparate impact" analysis--which is a creation of Title VII (employment discrimination) jurisprudence--in suits against homeowners' insurers. Specifically, these insurers' credit-based pricing mechanisms systems are attacked under the Fair Housing Act as having a discriminatory effect on members of protected classes with poor credit. Unfortunately, there are a number of legal, conceptual, and practical arguments against application of this Title VII standard in such cases. Yet courts endorsing this standard do not appear to have given due consideration to the possibility that some disparities simply might be "fair" for purposes of fair housing. Indeed, it would seem the most deleterious unfairness lies in requiring insurers to prove their race-neutrality through conceptually inapposite, impractical, and expensive means.