A pregnant woman, by Flickr user "karolajnat", licensed via Creative Commons.

Maternity Leave No Reason to Discriminate for Mortgage Insurer

Maternity v. Mortgage

The mortgage insurer MGIC Investment Group has settled a federal lawsuit alleging that they refused to sell mortgage insurance to women on maternity leave.  The suit claimed that the company required 70 women to return to work before they would sell them the insurance, which “allows homebuyers to take out loans with down payments of less than 20%”, according to the Wall Street Journal.  Yesterday, the company settled for $550,000, with $511,000 to be compensation for the women and $39,000 as a civil penalty to the government.  In addition, MGIC will have to train its employees on discrimination law and revamp its policies concerning customers on maternity leave.  The company has also entered a preliminary settlement in a related class action suit in order to avoid spending any more money on a lawsuit they will likely lose.

What baffles me about this whole case is why, in the first place and allegedly, the insurance company even bothered to force women back to work before offering, of all things, mortgage insurance.  What do they stand to gain from an early abandonment of postnatal bliss?  Perhaps — and I’m attempting here to co-opt the mindset of an insurance giant driven by revenues and margins and other terms usually filed under “soulless money-grubbing” — perhaps a quicker return to work means a quicker repayment of the loan.  Or maybe it’s less monetary a motivation than simply a form of fealty.  A willingness to repay the loan, to provide a tithe to beef up MGIC’s profit, would show that the women hold mortgage above the very life of a newborn child.  Valuable for an insurance provider whose existence is defined by the mitigation of risk in pursuit of money.

I guess we’ll never know.  The settlement money, although including a penalty to the federal government, is a legal way to stop a case while admitting no wrongdoing.  At the very least, some women can now enjoy both a baby and a mortgage at the same time.

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