The CLUE Report
The CLUE Report is an anacronym for Comprehensive Loss Underwriting Exchange. The CLUE is a huge database of information, primarily relating to insurance claims on private property. The database is operated by ChoicePoint, a Georgia firm.
The major problem with CLUE is that most consumers are simply CLUE-less as to its existence. This is definitely a case where "what you don't know CAN hurt you!" The report includes information about persons as well as property. It includes general information, such as that typically found in your credit history (things like name, birth date, current and prior addresses, etc.). It also includes more critical information relating to the claims history (including INQUIRIES) on an individual as well as a property. What this means is that, any time you file a claim as well any time you call your insurance agent to see whether an item might be covered, the information is entered into a database and made available to other insurance carriers through CLUE. What's more, suppose a neighbor tripped on your front step, injured themself on your property, and subsequently filed a claim for which your insurer was charged, THAT would appear on your CLUE report as well.
Why is all this important? In order for a buyer to get a mortgage, they must prove the home has insurance. If there are too many claims against the property, or too many against the buyer, or too many against the combination of buyer and property, the buyer might not be able to get insurance! Or, the cost of the insurance might be so high as to make it impossible for the buyer to get financing!
If you are a homeowner, it would be wise to make it a practice to avoid filing a claim with your insurance company unless it is absolutely necessary. And unless there is a serious reason to do so, it would also be wise to avoid so much as a phone call to your insurer to inquire about a potential claim. Remember, it is NOT necessary that a claim for compensation was ever filed for there to be an entry in the CLUE. Since the CLUE report impacts BOTH property and owner, you can be impacted whether you are a prospective home buyer, home seller, or both!
How many claims are considered "too many"? Experts generally agree that 2 or more claims in 3 years puts a property or buyer at risk for being either uninsurable, or insurable at significantly higher rates than the norm. Of particular concern are water related damages. Insurance companies are increasingly rejecting coverage for water related damage, in part reacting to the immediate damage from water, in part the resulting risk of mold.
In the event you wish a copy of your own CLUE Report, ChoicePoint charges $12.95 for each electronic report. In addition, any consumer who has been the subject of "adverse action" is entitled to a free copy of their report within 60 days of the adverse action. This can include denial of coverage, as well as an increase in premium charges. If you would like further information about CLUE or to request a copy of your own CLUE Report, simply CLICK here.