# 164


III-1.8200
III-3.3000                                   April 5, 1995





XXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXX  XXXXX

Dear Ms. XXX:

     Your letter to the President has been referred to me for
response.  Your letter asks whether an insurance company's
practices regarding reimbursement of expenses for rental vehicles
constitutes discrimination on the basis of disability.

     Your letter addresses an automobile insurance company that
reimburses the same rental vehicle cost under a policy on a van
equipped with a wheelchair lift and hand controls as it
reimburses under a policy on a vehicle without such equipment. 
According to your letter, such equal reimbursement is problematic
because it costs more to rent a vehicle to replace an accessible
van than it does to rent a replacement for an inaccessible
vehicle.

     Title III of the Americans with Disabilities Act (ADA)
prohibits discrimination on the basis of disability by places of
public accommodation, including service establishments such as
insurance companies.  Therefore, an insurance company may, in
some cases, be prohibited by the ADA from discriminating on the
basis of disability in making decisions to grant or deny
coverage, and in setting rates for types of coverage.  If an
insurance program provides the same benefits for persons with and
without disabilities, however, the fact that its terms do not
fully meet the needs of a person with a disability does not
necessarily constitute discrimination.

     In addition, an insurance company will not be prohibited by
the ADA from administering its benefit plan in accordance with
State insurance laws.  Therefore, State law may also play a role
in the determination of an insurance company's duties regarding
individuals with disabilities, but such State law may not be used
as a subterfuge to evade the purposes of the ADA.

     For your further information, I am enclosing a copy of the
Department of Justice's regulation implementing title III of the
ADA.  I hope this information is helpful to you.

                                   Sincerely,




                                John L. Wodatch
                                     Chief
                            Disability Rights Section

Enclosure