Baltimore insurance brokers file complaint accusing Erie Insurance of discriminating against Black customers

Three Baltimore-area insurance brokers have filed complaints with state regulators accusing Erie Insurance of discriminating by engaging in insurance “redlining” of predominantly Black neighborhoods in the city.

The brokerage firms, two of which are Black-owned small businesses, filed separate complaints this week with the Maryland Insurance Administration. The firms included Baltimore Insurance Network LLC of Bowie, Ross Insurance Agency of Windsor Mill and Welsch Insurance Group of Baltimore, all of which contract or had contracted with Erie as agents to sell policies.


They accuse Erie, which underwrites policies sold by the firms, of redlining, the practice of denying services to residents of certain neighborhoods based on race or ethnicity. The complaints say Erie refused to underwrite policies based on a potential client’s race, ethnic origin, neighborhood and/or socioeconomic status.

“Erie Insurance brokerages that serve Baltimore, and in particular that serve the poor areas of Baltimore which are predominately African American, are being told that even when customers meet their underwriting standards and when they would otherwise qualify, Erie is not interested in certain customers,” said Cary J. Hansel, an attorney for Baltimore Insurance.


A spokesman for Erie Insurance Group said Wednesday that the company has not yet been formally notified of the filings but will address any complaints with the insurance administration. The company said it does not comment publicly on specific customers, agents, claims or regulatory filings.

“Erie Insurance’s underwriting practices comply with all Maryland state insurance laws and regulations,” the spokesman, Matthew M. Cummings, said in an email. “We are committed to the equitable treatment of all prospective and existing customers and maintaining fair and equitable business standards.”

Based in Erie, Pennsylvania, and with a branch office in Silver Spring, Erie offers auto, home, business and life insurance policies.

“We take allegations like this seriously, and they will be thoroughly investigated,” said Craig Ey, a spokesman for the Maryland Insurance Administration.

Both Baltimore Insurance and Welsch said in their complaints that Erie urged them to not sell policies to people in Baltimore with “city sounding names.”

Baltimore Insurance Network said it was told by an Erie branch manager to “place those people elsewhere, I don’t care where, just not with Erie. They don’t fit Erie’s appetite. Find better people.”

That branch manager also told Baltimore Insurance that it was “devaluing the brand” by writing insurance policies for people in predominantly African American neighborhoods, and that the brokerage had to “understand Erie’s appetite.”

Likewise, Welsch Insurance Group’s Thomas A. Welsch was told to get his business “from somewhere else.” Welsch’s contract with Erie was terminated in August 2019, citing poor underwriting practices and unacceptable policy holder service.


Baltimore Insurance said it was instructed to reduce its sales by 30%, by rejecting applicants who qualified for coverage and were mostly Black and living in inner-city neighborhoods. The firm’s complaint says Erie required the brokerage to only include criminal record checks with applications in lower-income neighborhoods.

Hansel said his clients objected to what they believed to be unethical practices and faced retaliation.

Erie took steps such as reducing commissions and other compensation, limiting client referrals and finally terminating contracts in two cases, the complaints say. Baltimore Insurance’s commission was cut by 2% — roughly equal to $48,000 annually — because of concerns over performance and service, the complaint said.

The complaint from Ross Insurance, whose agency agreement with Erie was terminated in May, described “an undertone, both expressed in general ways and implied that limited, if any, coverage should be provided to persons living in certain sections of Baltimore city,” sections made up primarily of African American and other minority residents.

The Evening Sun


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That complaint said the brokerage firm suffered financial losses from being unable to write policies in certain ZIP codes.

The brokers are asking the Maryland Insurance Administration, which regulates the state’s insurers, to order Erie to end discriminatory practices and to enforce laws against insurance redlining. They’re also seeking damages for loss of commissions and fees.


The insurance administration will conduct a detailed, confidential investigation to determine whether the company broke the law. If so, the agency will issue a letter of determination.

A party that is not satisfied with the finding can request a hearing, which would be public.

Hansel said the brokers have been denied “hundreds of thousands of dollars in fees and bonuses because they won’t give in to discrimination.”

Cummings, the Erie spokesman, said the company has upheld core values of “dignity and respect” for more than 95 years.

“We strive to create an environment where customers, agents and employees reflect the diversity of the communities where we all live and work,” Cummings said.