Insurers Deny Katrina Claims in Black Neighborhoods at Higher Rates

State Farm, Allstate, and other insurers denied tens of thousands of Katrina claims in Black neighborhoods by reclassifying wind damage as flood damage not covered under standard policies. Mississippi Attorney General Jim Hood sued State Farm; documents revealed internal guidance to adjusters to reclassify damage. Black policyholders in the Lower Ninth Ward and St. Bernard Parish had denial rates significantly higher than white policyholders in comparable flood zones.