MICHIGAN - Attorney General Jennifer M. Granholm released the results of a statewide survey her office conducted into the practice of insurance redlining in Michigan.

In releasing the results - which showed disparities in auto rates of up to 17 percent in cities with similar population sizes and auto theft rates, but with differing racial make-ups - Granholm announced that she has asked the insurance providers for an explanation of the rate differences.

She said: "The findings of the study are compelling - and disturbing - to say the least. The time has come for the industry to be more up front with their customers. Consumers pay thousands of dollars a year to keep their homes and cars insured - they deserve to know how their rates are calculated.

"Redlining" in the insurance industry is a discriminatory practice in which insurance companies restrict the tying of credit scores to insurance rates.

Since redlining based solely on racial factors is illegal, Granholm has asked the insurance companies for an explanation of rate disparities her study found. Granholm's office reviewed 60 auto insurance quotes obtained for six pairs of Michigan cities that were similar in size and auto theft rates, but has different racial compositions.

The results showed that in five out of six city pairs, the same individual in a community with a sizable African American population paid a higher rate by an average of 14 percent.

A second study, using the same female and the same auto, compared rates between neighborhoods in the city of Detroit versus its border cities. The follow-up survey demonstrated average disparities of nearly 30 percent between rates based on addresses as close as a few blocks away. Granholm began the study - and a general review of discrimination in the financial industry - earlier this year after her Consumer Protection Division received a number of consumer complaints regarding potential insurance redlining and the use of credit scores in insurance rate setting.