Understanding CLUE Reports and Their Role in Homeowners Insurance
A Comprehensive Loss Underwriting Exchange (CLUE) report is a crucial tool in the insurance world, offering a detailed history of claims related to your home or vehicle. These reports, generated by LexisNexis, provide key information that insurers use to assess risk, set premiums, and make decisions about coverage. Understanding what’s included in a CLUE report and how it affects your homeowners insurance can empower you to make informed decisions.
What is a CLUE Report?
A CLUE report is essentially a claims history. It contains information about insurance claims filed on a property or vehicle over the past seven years. This includes details like:
- The insurance company involved
- The dates of losses and claims
- The type of loss (e.g., fire, wind damage)
- Whether the claim was denied
- The payout amount (if the claim wasn’t denied)
- The insurance policy number and claim number
It’s important to note that a CLUE report does not include personal information like credit scores, criminal records, or eviction notices.
How a CLUE Report Works
Most home and auto insurance companies regularly submit claims information to the CLUE database, which is maintained by LexisNexis. This ensures a comprehensive record of claims. When you apply for a new insurance policy, the insurer will likely request your CLUE report to assess your risk profile. They use this information, along with other factors, to determine your premium and coverage terms.
Why Request a CLUE Report?
While insurers often pull CLUE reports, it’s also beneficial to request one for yourself. Here’s why:
- Verify Accuracy: Occasionally, CLUE reports may contain errors, especially if you share a name with someone else. Reviewing your report allows you to identify and dispute any incorrect information before it affects your insurance rates.
- Assess Your Home’s History: If you’re considering buying a home, obtaining a CLUE report can provide valuable insights into its claims history. This helps you identify potential issues and make informed decisions.
- Shop for Insurance: Checking your CLUE report before shopping for insurance allows you to identify any inaccuracies and dispute them with LexisNexis. This ensures you get the most accurate rate possible.
- Evaluate Claims-Free Status: A blank CLUE report can be a positive indicator. It suggests that the property or vehicle hasn’t had any claims filed in the past seven years, potentially indicating a lower risk.
How CLUE Reports Affect Your Homeowners Insurance
A CLUE report can significantly impact your homeowners insurance premium. Insurance companies use the information in your report to evaluate your risk. Several factors can influence your premium:
- Claim Frequency: A history of multiple claims can raise your premium. Insurers view this as a sign of higher risk.
- Type of Claims: Claims related to certain events, such as hurricanes, may lead to a premium increase if the insurer believes there is a higher likelihood of future incidents.
- Severity of Claims: Larger claim payouts may indicate more significant issues with the property and can also impact your premium.
What to do if Your Report is Blank
A blank CLUE report doesn’t necessarily mean there were no issues; it simply indicates that no claims were filed, or the insurance provider does not report to LexisNexis. This could mean the owner paid for the damage out-of-pocket rather than filing a claim.
How to Obtain a CLUE Report
Under the Federal Fair and Accurate Credit Transactions Act (FACT Act), you are entitled to one free CLUE report for your home or vehicle each year from LexisNexis. You can request a report by:
- Requesting a CLUE report online
- Calling LexisNexis at 866-312-8076
- Emailing [email protected]
How to Dispute Errors in a CLUE Report
If you find any errors on your CLUE report, you can initiate a dispute with LexisNexis. Here’s how:
- Call 888-497-0011.
- Write to LexisNexis Consumer Center, ATTN: FACT Act Dispute Request, P.O. Box 105295, Atlanta, GA, 30348-5295.
Under the Fair Credit Reporting Act, LexisNexis must work with your insurance company to remove any claims that cannot be verified within 30 days.
Key Takeaways
- CLUE reports provide a history of insurance claims filed on a property or vehicle.
- They can impact your homeowners insurance premium.
- Request a copy of your report to verify accuracy.
- Dispute any errors to avoid issues with your coverage.
By understanding CLUE reports, you can be proactive in managing your insurance and protecting your property.
