In one of the first actions of its kind, a West Dayton couple have filed a $4.2 million law suit in U.S. District Court charging five Ohio and Indiana insurance companies and a local agent with racial discrimination.

Austin and Mary Dunn said their homeowners' insurance was terminated solely because they are black and live in a black neighborhood.

The case is one of 11 with alleged questionable practices referred to Justice Department here last month by the Montgomery County (Ohio) Fair Housing Center.

In their suit filed last week, the Dunns charge that the loss of their homeowners' coverage, "was directly related to the location of their residence in predominantly black neighborhood, the fact that they are black, and to the racial composition of the portfolio of homeowners insurance business handled by Borchers for Midwestern."

Named as defendants were the Midwestern Indemnity Co., and its subsidiary, Mid-American Fire and Casualty Co. of Milford, Ohio; the American State Insurance Companies of Indianapolis; the Commercial Union Assurance Co. of Cicinnati; the Hartford Insurance Co. of Cincinnati; the Borchers Insurance Co. of Dayton and the Borden Greathouse, agent for Borchers.

None of the defendants could be reached for comment.

The law suit comes two weeks after the release of a report by the housing center, a consumer group funded by the country, documenting 40 complaints by Dayton homeowners of insurance cancellations despite years of regular premium payments and few claims.

Most complaints were from black residents living in poor areas, said Ashley C. Brown, a center official and attorney for the Dunns.

"I think redlining by insurance agencies in Dayton is widespread," he said.

Brown contends that the alleged refusal to insure homeowners is a form of "redlining" that violates the federal Fair Housing Act.

The Dunns said that although they had filed only one claim under their homeowners' policy, which they had held for 22 years, their $30,000 policy was cancelled in December after Midwestern decided they would no longer provide coverage through Borchers, an independent agency.

The Dunns filed their single claim several years ago and it was for less than $100, Brown said.

The suit follows the release of a recent U.S. Department of Housing and Urban Development study that revealed that only a fraction of the nation's blacks receiveequal treatment when looking for housing.