Have A CLUE About
Your Insurance Claims History.
It Really Matters!
Have you recently attempted to sell
a home and found out that your potential buyer is having trouble
obtaining homeowner’s insurance required by the mortgage
company? Have you attempted to buy homeowner’s insurance
and been denied coverage or offered it at a high cost?
More than 600 insurers now use the
Comprehensive Loss Underwriting Exchange (CLUE). In existence
for many years, this database allows insurers to share information
about your prior auto and homeowner’s insurance claims.
More than $9 billion in insurance losses this past year has led
insurers to toughen their claims response by denying coverage
or increasing premium rates based on what is reported in the CLUE
Your CLUE report is very important
and may strongly influence your ability to obtain homeowners’
insurance—and at what cost. Accuracy is vital and you should
Order a copy of your report from
ChoicePoint Asset Co., the company that runs the database, online
at www.choicetrust.com; by calling 866-527-2600; or by writing
to ChoicePoint Insurance Consumer Center, P.O. Box 105108, Atlanta,
Georgia 30348-5108. The cost is $12.95 or less and free if you
have been denied insurance. It will tell how many claims have
been filed by you or by the property owner over the past five
years, the insurer’s name, the policy type (i.e. homeowners),
the claim date(s), the claim amounts, the insurance company’s
policy and claim numbers, and whether a claim is closed.
Unfortunately, some national consumer
advocates believe the database isn’t always accurate. For
example, the California insurance commissioner recently argued
the insurance industry was misusing CLUE information and that
homeowners had been denied policies because of database errors.
The commissioner wrote an emergency rule restricting insurance
companies from choosing their customers on the basis of past claims,
but on August 28, 2003, a California state court judge struck
down the rule.
Like your credit report, you should
check your CLUE report at least once per year, particularly if
you expect to buy or sell a home in the near future. If you find
errors in your report, you may ask the company to verify the information
with the reporting insurance company within 30 days of your request.
You may also include a statement with your version of what happened,
but some consumer advocates question whether the statements really
help you at all with insurers.
For another $12.95, you may also
order your insurance score, a three-digit rating based on your
claims history. It’s often the primary basis for the insurance
company’s coverage and premium decisions.
Be an educated consumer and ensure
insurance companies set coverages and prices for the right reasons.