Caedes et Caenum

It is undeniable that a significant disparity exists between the credit scores of different racial groups in America.  So if an insurance company prices homeowners’ insurance based on credit information, does the resulting disparity in prices among its customers of different races constitute discrimination?  In a new paper, I address how we ought go about answering this question.  Is every disparity in housing-related costs the result of racial animus, or are some of them simply fair?  And is it even possible to reach the answer in a way that does not implicate vulnerable normative judgments?

These questions have been brought into view by recent litigation.  Individuals have brought suit against their insurers under the Fair Housing Act, alleging discriminatory treatment—or failing that, discriminatory effect—in the provision of housing services.  In resolving these claims, courts appear willing to apply the “disparate impact” theory of racial or other unlawful discrimination crafted under Title VII, which addresses employment practices.

The problem is that there are a number of legal, conceptual, and practical considerations militating against application of the traditional disparate impact analysis in this context.  Courts endorsing the Title VII standard in such cases fail to recognize the possibility that some disparities are simply the result of patterns of individual decision-making.  Where the potential for discrimination exists, Fair Housing Act litigation should itself be fair—it ought not force insurers to prove their race-neutrality by way of conceptually inapposite, impractical rigors.

A fairly complete draft of the paper can be downloaded from the following link:
http://works.bepress.com/matthew_cochran/1.