Recs

2

Get a CLUE (Report)

When it comes to taking care of our finances, it can seem as though the deck is stacked against us.

There's a danger facing many people who buy a new home: They may run into insurance trouble, not because of any claims they do or don't file -- but because of claims filed by previous owners!

That's right -- there may be a record in the Comprehensive Loss Underwriting Exchange (CLUE) database of one or more claims filed on the house. There may even be records of inquiries about damages. You read that correctly -- if you call your insurer and discuss a possible claim, your call might end up in a CLUE report.

Many homeowners find out that the home they were so excited to buy is uninsurable -- no home insurer is willing to cover it because of past claims. (Some 90% of home insurers subscribe to CLUE.)

Can it get worse? You bet. According to an article at insure.com, if you file a claim -- say, for mold -- when you live in one home, and you later buy another home, you may find yourself faced with sky-high premiums at the new home because of your claim history at the old one.

Crazy, eh? The more claims you file, the more you might be charged when you buy a new policy.

What to do
Be prepared. Understand that when someone applies for homeowner insurance, the insurer will typically look into the claim history as far as five years of both the buyer and seller. Try to get a copy of the CLUE report for any home you're considering buying. You can't do so if you don't own the home, but you could ask the seller to get a copy for you. It may contain useful information, revealing past problems with the home.

ChoicePoint (NYSE: CPS  ) is the company behind CLUE reports. You're entitled to a free copy of your home's CLUE report if you're denied insurance due to information contained in the report. [Note that ChoicePoint is being bought by Reed Elsevier (NYSE: RUK  ) .]

Keep learning
Learn more in our Insurance Center:


Read/Post Comments (0) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

DocumentId: 608351, ~/Articles/ArticleHandler.aspx, 4/20/2014 11:01:43 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Selena Maranjian
TMFSelena

Selena Maranjian has been writing for the Fool since 1996 and covers basic investing and personal finance topics. She also prepares the Fool's syndicated newspaper column and has written or co-written a number of Fool books. For more financial and non-financial fare (as well as silly things), follow her on Twitter...

Today's Market

updated 3 days ago Sponsored by:
DOW 16,408.54 -16.31 -0.10%
S&P 500 1,864.85 2.54 0.14%
NASD 4,095.52 0.00 0.00%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/18/2008 4:03 PM
CPS $49.85 Down +0.00 +0.00%
ChoicePoint, Inc. CAPS Rating: *
RUK $59.66 Up +0.87 +1.48%
Reed Elsevier plc… CAPS Rating: *

Special Offer for Savvy Investors Like You!

Lorem ipsum dolor sit amet, consectetur adipiscing elit. Ut semper dui vitae molestie venenatis. Suspendisse.

Enter Email Address:



Privacy / Legal Information
Advertisement