CHICAGO (AP) _ Allstate Insurance Co., pledging to make homeowners insurance easier to obtain in low-income and minority neighborhoods, announced a pact with a fair housing group to test its sales practices.

The agreement announced Wednesday settled a 1994 complaint of discriminatory practices filed against Allstate with the U.S. Department of Housing and Urban Development.

The National Fair Housing Alliance, which had filed the complaint, will use pairs of whites and minorities posing as customers to test Allstate agents over a three-year period.

Robert Pike, Allstate senior vice president and general counsel, said the insurer itself requested the tests after working closely with the housing alliance.

``Allstate looks at the urban market from a business standpoint as a profitable opportunity,'' Pike said. ``We wanted to make absolutely sure we met standards set for all our customers. Testing told us that ... we didn't in all instances meet them.''

Allstate, based in Northbrook, Ill., issues policies to one out of every eight houses in the country and is the largest insurer in inner cities. It admitted no wrongdoing in the settlement.

Shanna Smith, executive director of the Washington-based housing alliance, called the agreement ``a wakeup call for other insurance industry members.''

Allstate agreed to pay at least $500,000 to the alliance, much of which will go for conducting at least 1,200 tests of 100 Allstate agents over the three years to make sure they are complying with anti-discrimination laws.

The alliance will also augment existing sales training programs and lead company seminars relating to homeowners insurance availability and fair housing issues.

In addition, Allstate said it will write letters to homeowners whose coverage has been limited in the past, inviting them to apply for new, expanded policies. The company will also explain to applicants in writing any reasons for rejection.

Allstate's pact goes beyond an agreement the alliance negotiated last year with State Farm Insurance, the nation's biggest insurer. State Farm, based in Bloomington, Ill., revised its urban guidelines and agreed to open new offices in urban areas.

Another insurer, Columbus, Ohio-based Nationwide, is still in negotiations with the Fair Housing Alliance and HUD.