Attorney General Kwame Raoul, along with District of Columbia Attorney General Brian Schwalb, has led a coalition of 19 state attorneys general in filing an amicus brief. This brief urges a federal court to reject the insurance industry's challenge to the Department of Housing and Urban Development’s (HUD) Discriminatory Effects Rule. The rule is designed to ensure that housing practices, which may seem neutral but are discriminatory in effect, do not disproportionately impact certain populations.
"Accessible homeowners insurance is critical to ending housing discrimination," stated Raoul. "Shielding what are effectively discriminatory insurance policies and practices from federal liability would deal a significant blow to efforts made by states, including Illinois, to combat housing discrimination."
The Fair Housing Act prohibits housing practices that have a disparate impact on individuals based on race, national origin, or other protected characteristics. However, companies selling property and casualty insurance have sued to invalidate HUD's rule as it pertains to homeowners insurance pricing and underwriting. They argue that HUD should provide a blanket exemption when state-level laws conflict with this rule rather than addressing each case individually.
Previously, another coalition led by Raoul filed a brief in 2023 supporting HUD's decision not to create broad exemptions for homeowners insurance. The trial court recognized this brief as "significant" evidence supporting HUD's approach and upheld the rule.
Raoul's current brief in the U.S. Court of Appeals for the 7th Circuit continues these arguments. It refutes claims that applying the Discriminatory Effects Rule interferes with state-level regulation of insurance markets. The coalition argues that in many states, including Illinois, HUD’s rule complements existing anti-discrimination laws and regulatory efforts within the homeowners insurance industry.
Attorneys general from Arizona, California, Colorado, Delaware, Maryland, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont and Washington joined Raoul and Schwalb in filing this brief.