UAF: Corporate Abandonment and Discriminatory Practices Are Destroying Generations of Black American’s Advancement Opportunities
WASHINGTON, DC – New analysis from Unlocking America’s Future revealed today that the nationwide insurance crisis is, in reality, another assault on Black homeownership—with discriminatory algorithms, corporate abandonment, and the legacy of redlining converging to destroy the primary source of wealth for Black Americans.
“Home insurance corporations are exploiting families during their most vulnerable moments, and it’s acutely impacting Black Americans. The proprietary algorithms and models used by home insurers essentially ensures Black homeowners pay more for less,” said Kyle Herrig, Unlocking America’s Future. “Home insurers are denying legitimate claims, dropping coverage without warning, and raising premiums to unaffordable levels, leaving Black families scrambling to find alternatives to protect their homes and wealth that simply often do not exist. Meanwhile, these same home insurance corporations are posting record profits and paying out massive executive compensation packages.”
Black homeowners are being priced and left out of the home insurance market, with some 11% having no homeowners insurance—compared to 7.4% of homeowners overall—leaving many one disaster away from financial ruin. Across the United States, 6.1 million homeowners are completely uninsured, with families of color bearing a disproportionate share exposed and vulnerable to unrecoverable losses after disaster strikes.
The crisis is accelerating nationwide. Between 2021 and 2024, home insurance premiums rose in 95% of ZIP codes, leaving more and more homeowners underinsured or forced to go without coverage entirely. Growing risks are making it increasingly difficult to find and afford coverage as home insurance corporations exploit climate change-driven extreme weather to justify massive rate increases, particularly for Black families across the Gulf South, where cost, discrimination, and disproportionate exposure to physical risks have all made home insurance more expensive and less available.
Modern Redlining: From Maps to Algorithms: The insurance crisis facing Black homeowners today is a direct continuation of the redlining practices that denied Black families access to mortgages and insurance in the 1930s. Over $100 billion worth of homes in formerly redlined neighborhoods face high flood risks, which is 25% more than in non-redlined, predominantly white neighborhoods. Notably, maps from the 1930s showing redlined neighborhoods could be used as modern flood risk maps in many U.S. cities. These are the same neighborhoods that were deliberately denied investment and insurance access for decades, and today’s insurance companies are once again abandoning them to climate disasters.
Today, rather than drawing red lines on maps, insurers now use digital algorithms that can include hundreds of individual, property, and neighborhood factors—including ZIP codes and homeowners’ credit scores—to price insurance. The result is what consumer advocates call the “credit penalty”: property insurance companies charge the typical homeowner nearly $2,000 more each year because they have a lower credit score than their otherwise similar neighbors.
Louisiana: A Warning Sign of What’s Coming: The severity of the crisis is perhaps best illustrated by Louisiana, where non-renewal rates have surged since 2018. Families who have paid premiums faithfully for years are discovering their policies won’t be renewed, forcing them into Louisiana’s insurer of last resort or leaving them to navigate an increasingly unstable private market with dramatically higher costs.
This crisis is not confined to one state—it’s impacting Black homeownership and wealth stretching across the entire country. The neighborhoods most impacted by the climate-driven insurance crisis stretch along the Gulf Coast, from western Florida to southern Texas where around half of all Black Americans call home face increasing hurricanes, floods, and extreme weather.
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