auto insurance

I live in Maine.
After paying the sign up fee in good faith, 5 weeks later I have been refused auto insurance because my roommate has had a suspended liscense - is this legal? Isn't this defamation of character - my driving record is blemish free.

Although I got no suggestions from anyone on this it turned out okay. My roommate got his license reinstated and the suspension was wiped off his record. The insurance company decided to keep me, I felt at first as though I should seek alternate insurance people but decided not to.