FOR IMMEDIATE RELEASE                                          CR
MONDAY, MARCH 10, 1997                             (202) 616-2777
                                               TDD (202) 514-1888

                     WITH JUSTICE DEPARTMENT

     WASHINGTON, D.C.    Nationwide Insurance will invest more
than $13 million in up to ten communities and change some of the
ways it underwrites and markets homeowners insurance to ensure
that minority neighborhoods get equal access to insurance, under
an agreement reached today with the Justice Department.

     The agreement, filed today in U.S. District Court in
Columbus, Ohio, resolves allegations that the fifth largest
provider of homeowners insurance in the nation made homeowners
insurance unavailable or available on less favorable terms in
minority neighborhoods.  It stems from cooperative discussions
initiated by Nationwide during a Justice Department
investigation, and for the most part incorporates insurance
practice reforms already planned by the company.

     "When concerns were raised over its policies, Nationwide
came to the Justice Department to work them out," said Attorney
General Janet Reno. "Today's agreement brings Americans of all
backgrounds closer to the dream of owning a home, nationwide."

     Under the agreement--the most comprehensive settlement ever
reached with an insurance company under the federal Fair Housing
Act--Nationwide will:

     inspect the condition of a home to decide if it should be
     covered, instead of simply refusing coverage because the
     home is too old or falls below a certain value;

     no longer require a home's market value to be a minimum
     percentage of the total cost of replacement; 

     not place any geographic restrictions that bar homeowners
     insurance in minority neighborhoods; 

     increase insurance coverage through targeted advertising and
     community outreach; 

     train its employees about the need to treat applicants
     without regard to race and monitor their performance through
     testing; and,

     provide $2.2 million in each of the next six years to up to
     ten cities where Nationwide primarily conducts business to
     assist homebuyers in minority neighborhoods with down
     payments, closing costs, below market mortgage loans, second
     mortgages, and home ownership counseling.

     "The reality for most people is that to buy a home, you need
a mortgage, and to get a mortgage, you need homeowners
insurance," noted Isabelle Katz Pinzler, Acting Assistant
Attorney General for Civil Rights.  "Without an equal shot at
getting this insurance, the American Dream of owning your own
home is just that, a dream." 

     In a suit filed together with the agreement, the Justice
Department said the company violated the federal Fair Housing Act
by using certain rules regarding the age and value of a home.

     It said that Nationwide's rules that a home cannot be
insured if it is above a certain age or below a certain value
were not supported by economic considerations.  These rules
effectively barred coverage in minority neighborhoods where homes
are typically older and undervalued, in part due to
discrimination in the real estate market.

     In large part, because of these rules, the complaint asserts
the company restricted the neighborhoods in which homeowners
policies could be offered based on the racial or ethnic
composition of the area and instructed its agents to avoid doing
business in minority neighborhoods.  

     State Farm, Allstate and American Family Insurance
previously changed these policies following complaints under the
Fair Housing Act.

     "Insurers should make decisions based on risk, not race,"
said Reno. "This settlement ensures that homeowners of equal
risk, regardless of race or ethnic origin, will enjoy equal
access to homeowners insurance."

     Under today's agreement, which must be approved by the
court, the Columbus-based company will continue establishing
"outreach" offices, including opening offices in 15 cities over
the next 6 years.  The offices will conduct targeted advertising
and public education programs to increase market penetration in
primarily minority urban areas.  Such offices already exist in
San Antonio and Chicago and, by the end of the year, new offices
will open in Philadelphia, Cleveland, and Baltimore.

     "Without insurance, damaged homes in urban areas go
unrepaired and the neighborhood suffers," added Pinzler.  "The
community investment funding will help reverse the downward
spiral by helping low- and moderate-income families buy homes in
these neighborhoods."

     The $13.2 million in community investment will be
administered by two community groups, the Local Initiative
Support Corporation (LISC) and the NeighborWorks Network.

     In 1995, the Justice Department reached a similar agreement
with American Family Insurance Company in Milwaukee.  Sales
agents there accused management of telling them not to write
policies to blacks.  The cases against State Farm and Allstate
were resolved by the Department of Housing and Urban Development.
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