[RPPTL LandTen] COMPANION ANIMALS -- INSURANCE COMPANY LIABILITY FOR REFUSAL TO INSURE

Fri Oct 2 15:39:27 PDT 2015

Dear Fellow (residential) L-T Committee Members:

                   A few weeks ago there was an exchange of e-mails about companion/service animals and tenants' rights under the U.S. Fair Housing Act and the U.S. Americans with Disabilities Act.  Some landlord advocates expressed concern about their clients being told by their insurance companies to deny accommodations involving animals.  I pointed out that insurance companies are liable under the Fair Housing Act for discriminatory practices in violation of the Act; and I suggested that landlords could successfully sue the insurance companies.

                   Below is a "paste" of an article about a Connecticut case involving the very similar point as to insurance decisions related to race and national origin and State law proscription of "source of income" discrimination.

[Connecticut Law Tribune]
Page printed from: Connecticut Law Tribune<http://www.ctlawtribune.com/>
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Insurers Accused of Discriminating Against Low-Income Tenants Settle Lawsuit for $475,000
Plaintiffs say coverage was canceled after they rented to Section 8 tenants
Christian Nolan, The Connecticut Law Tribune
September 22, 2015
Viens v. American Empire Surplus Lines Insurance: Landlords who sued an insurance company for allegedly terminating their property insurance policies because they rented to tenants paying with Section 8 housing vouchers have settled their federal lawsuit for $475,000.
The Connecticut Fair Housing Center in Hartford joined the two landlords in filing a federal lawsuit against American Empire Surplus Lines Insurance Co. alleging source-of-income discrimination in violation of the state's fair housing law. The plaintiffs' lawsuit also alleged discrimination on the basis of race and national origin in violation of the state's fair housing law and the federal Fair Housing Act, as a large percentage of Section 8 users are minorities.
Greg Kirschner, the Fair Housing Center's legal director, explained that American Empire refused to renew property insurance policies or charged higher premiums based on the presence of tenants who used the housing vouchers in Willimantic and Stamford rental properties. "Source-of-income discrimination keeps deserving and qualified families from accessing desirable housing and continues to be a significant obstacle to the center's work of ensuring that all people have access to the housing of their choice, free from discrimination," Kirschner said.
Jeffrey Viens and Karen Wellikoff are landlords who rent apartments to tenants receiving assistance under the Section 8 Housing Program administered by the U.S. Department of Housing and Urban Development. Under the program, participants find apartments and make rent payments that are 30 to 40 percent of their gross income. In turn, HUD pays the landlord a subsidy equaling the remainder of the rent.
Viens owns three properties in Willimantic, each of which has a Latino tenant who uses a Section 8 voucher. Starting in April 2013, Viens' properties were insured under a property policy issued by American Empire. In January 2014, however, he received a written notice of non-renewal from the insurer, which stated that the policy would be canceled effective April 2014. The only stated reason in the note was "subsidized housing-Section 8."
Viens was later told that the reason for non-renewal was the number of Section 8 qualifiers who were his tenants. Because of this non-renewal, Viens was forced to acquire replacement insurance coverage that provided less favorable terms and cost considerably more.
Wellikoff, meanwhile, owns a three-unit property in Stamford and has rented to tenants receiving Section 8 assistance over the years, each of whom was Latino or African-American. She said she was told in late 2012 that because she rented to Section 8 tenants she would have to pay an additional yearly premium of $575 or face cancellation of both her property and liability policies.
Wellikoff told the insurer that what they were doing was illegal and refused to pay the premiums. Her policy was eventually canceled as a result. Wellikoff ended up having to obtain a replacement policy that was more expensive and provided less favorable coverage.
Both of these plaintiffs, unbeknownst to each other, contacted the nonprofit Fair Housing Center. In June 2014, the center, with assistance from the Washington, D.C., law firm of Relman, Dane & Colfax and attorney Stephen Dane, filed a lawsuit in the U.S. District Court for the District of Connecticut against the insurance company. American Empire was defended in the case by Jill O'Toole of Shipman & Goodwin in Hartford. O'Toole did not immediately respond to a request for comment.
O'Toole filed a motion to dismiss the lawsuit, but in a written ruling this summer, U.S. District Senior Judge Janet Bond Arterton denied that motion. "From the facts alleged, it can be plausibly inferred that [American Empire's] conduct has a discriminatory impact on housing opportunities, that [American Empire] has published statements indicating a discriminatory preference, and has interfered with [the] plaintiffs' right and obligation to rent to tenants without consideration of their lawful source of income," Arterton wrote.
Following Arterton's ruling, settlement talks escalated. The parties recently reached an agreement to settle the case for $475,000 and American Empire, without admitting liability, agreed to no longer consider a tenant's lawful source of income in connection with its insurance underwriting practices.
Kirschner is hopeful this case will deter other insurers from such practices but has heard about this occurring elsewhere.
"We have heard anecdotally that there are other instances of this occurring," Kirschner said. "Just recently there was a case in California, I believe, against Travelers that settled before it went to trial, alleging basically the same violations. So we do have concern that this is happening more broadly in the marketplace."
Christian Nolan can be contacted at CNolan at alm.com<mailto:CNolan at alm.com>.

________________________________

                      Marty

                     C. Martin (Marty) Lawyer, III
                     Florida Bar # 128095
                     Bay Area Legal Services, Inc.
                     1302  N. 19th St.,  Suite # 400
                     Tampa,  FL 33605-5230
                     (813)  232-1222, Ext.109
                      FAX:  248-9922

"Preserving Independence, Hope and Dignity"
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