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 database.

   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 dispute errors.

   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.