The Auto Channel
The Largest Independent Automotive Research Resource
The Largest Independent Automotive Research Resource
Official Website of the New Car Buyer

Nationwide Insurance Withdraws Legal Challenge of Auto and Homeowners Data Release

26 May 2000

Nationwide Insurance Withdraws Legal Challenge of Auto and Homeowners Data Release
                 Center for Economic Justice applauds action

    COLUMBUS, Ohio, May 26 Nationwide Insurance today
announced that it is withdrawing its legal actions against the Texas
Department of Insurance (TDI) and the state attorney general's office aimed at
preventing the release of the company's quarterly market reports on auto and
homeowners insurance sales.
    The reports, which are filed with the TDI, contain information about
Nationwide's sales in Texas.
    The auto information has been sought from Nationwide and other Texas
insurers by the Center for Economic Justice (CEJ), a consumer group based in
Austin, Texas.  Nationwide had obtained a temporary restraining order to
prevent state officials from releasing the auto data pending a court hearing.
    Lorraine Brock, Nationwide's vice president of urban markets development,
said, "While Nationwide still is concerned about the release of trade secrets
and proprietary data to our competitors, we feel the issue of releasing the
data has been disputed long enough.  And, any consideration of continuing the
court case is outweighed by our strong desire to clear up any misconception
that we are hiding information from the public."
    She added that while Nationwide has decided to end its litigation, the
company recognizes the right of other Texas insurers to contest this issue.
    D. J. Powers, the CEJ's legal counsel, praised Nationwide for agreeing to
release the data.  "Nationwide's agreement shows that Nationwide is on your
side when it comes to public accountability.  Nationwide alone has stepped
forward and said it has nothing to hide."
    Birny Birnbaum, the CEJ's consulting economist, said, "I applaud
Nationwide's decision to put its efforts into expanding its presence in
underserved areas, instead of continued litigation to keep the public from
monitoring the market performance of insurers.  I commend Nationwide's
leadership and foresight on the ZIP code data issue and we look forward to
working with Nationwide and others to improve the insurance availability in
poor and minority communities.  I urge other insurers to stop litigating and
to put those resources into expanding sales in underserved areas."
    State District Judge Jeanne Meurer ruled on May 12 that the CEJ and others
are entitled to quarterly reports Nationwide files with the TDI concerning its
homeowners insurance marketing efforts in the state's underserved areas.  She
is scheduled to hear the auto insurance industry's challenge of the release of
auto data on June 26, although Nationwide will no longer be a party to that
proceeding.
    Brock said Nationwide has launched an unprecedented program in Texas to
increase insurance availability in underserved areas.
    "We are growing in underserved areas and we intend to grow even more.
Nationwide will spend some $9 million during a five-year program to develop
sales and service centers and urban agencies in underserved areas in Texas,"
Brock said.
    Nationwide has opened sales and service centers during the past 12 months
in McAllen and Dallas.  A similar center has been in operation in San Antonio
for several years.   It also has added nearly 20 agencies in the underserved
areas of Houston, Austin, Dallas, Ft. Worth, El Paso, San Antonio and McAllen.
    "In addition to our Texas growth plan, I am proud to note that Nationwide
continues to be an active supporter of underserved communities, both in Texas
and nationally," Brock said.
    Nationwide has contributed more than $1 million to Texas organizations to
improve conditions in underserved areas.  They include: Neighborhood Housing
Services (NHS) of San Antonio, $520,000; Neighborhood Housing Services of Ft.
Worth, $511,000; San Antonio Alternative Housing Corp., $5,000; Fifth Ward
Community Development Corp. in Houston, $10,000; and the Houston Urban League
and Austin Urban League, $10,000 each.
    As part of its program to help improve urban neighborhoods, Nationwide
employees and agents have finished construction of a Habitat for Humanity
house in San Antonio, have started construction of one in Dallas, and will
build another one in Houston later this year.  Nationwide has pledged $2
million to help build 40 Habitat houses in 40 cities across the country.
    Nationwide also started a partnership this year with the National Latino
Children's Institute and recently donated 200 car safety seats to promote
children's automobile safety in Hispanic communities.  The seats were given
away to residents in Dallas, El Paso, Houston, McAllen and San Antonio.
    The company was the title sponsor for this year's 31st NAACP Image Awards.
Last year, Nationwide committed $600,000 to the United Negro College Fund
(UNCF) for a scholarship and mentorship program.  Nationwide has been a top
corporate sponsor since 1986 of the national INROADS, Inc., which offers
corporate summer internships to minority students.
    Nationwide, based in Columbus, is the country's fourth largest homeowners
insurer and fifth largest auto insurer.
    The Center for Economic Justice is a Texas nonprofit corporation dedicated
to protecting the interests of minority and low-income consumers as a class.