ABSTRACT: Racial profiling has emerged as a highly contentious practice in a range of social settings. This article examines the role of racial profiling in the property insurance industry and how such practices, grounded in negative racial stereotyping, have contributed to racial segregation and uneven metropolitan development. From a review of industry underwriting and marketing materials, court documents, and research by government agencies, industry and community groups, and academics, it is clear that race has long affected and continues to affect the policies and practices of this industry. Due to limitations in publicly available data, it is difficult to assess precisely the extent to which race shapes industry practices. Research and public policy initiatives are explored that can ameliorate the data problems, increase access to insurance, and foster more equitable community development. Very honestly, I think you write too many blacks...you got to sell good, solid premium paying white people....the white works’’ Sales manager for American Family Mutual Insurance Company (NAACP v. American Family Mutual Insurance Company, 1992).

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This paper develops a model of crime analyzing how such behavior is associated with individual and neighborhood poverty. The model shows that even under relatively minimal assumptions, a connection between individual poverty and both property and violent crimes will arise, and moreover, "neighborhood " e¤ects can develop, but will di¤er substantially in nature across crime types. A key implication is that greater economic segregation in a city should have no e¤ect or a negative e¤ect on property crime, but a positive e¤ect on violent crime. Using IV methods, I show this implication to be consistent with the empirical evidence.