Whose Safety Net? Home Insurance and Inequality


  • The authors wish to acknowledge research support provided by the University of Miami, research assistance provided by Les Riordan, and assistance in the design, distribution and collection of the survey provided by the University of Miami publications and mail departments. Thanks to Ian Ayres, Howard Erlanger, Michael Froomkin, Terence Halliday, Marvin Jones, Karyl Kinsey, Sheldon Messinger, David Reiss, Robert Rosen, Laurence Ross, Jonathan Simon, and anonymous reviewers for comments on an earlier draft.


Drawing on prior theoretical and empirical work that has begun to constitute the insurance field as a distinct sociolegal research project, this study uses quantitative and qualitative data collected following Hurricane Andrew in 1992 to explore distributional questions within that field. Survey results show that higher income, age, and education were associated with having home insurance and that Hispanics and blacks were less likely than non-Hispanic whites to have insurance. The study provides the first quantitative evidence of bias in the insurance claims process by documenting a statistically significant and substantial ethnic difference in the timing of insurance payments. The qualitative research helps to explain the difference in the timing of insurance payments as the product of unconscious bias by insurance adjusters. The study concludes by proposing market-structuring regulation to reduce the inequality encountered.