Most people are familiar with a credit report and have a reasonable idea of their credit score. It's widely publicized that you should review your credit report to check for mistakes. Afterall, your credit score affects getting a loan, obtaining credit cards, and renting or buying property. However, far fewer people have heard of a C.L.U.E. report which directly affects their insurance rates.
C.L.U.E. stands for Comprehensive Loss Underwriting Exchange which is basically a large database of claims history information maintained by LexisNexis®. Insurance companies use reports generated from this database to check for claims information during the underwriting or rating of an insurance policy. Typically, the insurance company uses the report when writing a new policy since most companies already have loss histories of existing customers that are renewing a policy.
The C.L.U.E. report will show information such as name, birth date, policy number, and any claims filed against that policy. For each claim there will be a date, the type of loss, any money paid out and a policy coverage description. If it is a homeowner’s policy, then it will include the property address while if it is an auto policy, it will have specific information about the vehicle covered. The information is kept in the database for up to seven years.
So how does the C.L.U.E report affect what you pay for insurance? Based on the information
in the report, the insurance company determines how to set your rates. Think of it like your credit score only in this case it has to do with how likely you are to file a claim against your policy. Just like your credit report, inaccurate information can end up in the C.L.U.E report as well. If you are suddenly paying higher insurance rates or recently denied insurance, then you
need to check the reported claims against you.
To get a copy of your C.L.U.E. report, the federal Fair Credit Reporting Act allows you to
request a copy from LexisNexis® or you can also contact your insurance agent. It is possible to get one free copy a year of the report. However, If your insurance is denied, your policy cancelled, your coverage limited, or your premiums increase, then you can receive another free copy. You also have a right to dispute any errors that you find by directly reporting the problem to LexisNexis®. They will then contact the insurance company on your behalf and let know you of the results in 30 days. You can also give a personal statement to LexisNexis® to add to future C.L.U.E. reports if you feel an item on the report is valid but deserves an explanation.
I only learned of the C.L.U.E. report after being in a car accident and discussing with a friend why sometimes it seems like your rates go up even if you are not at fault. Now, that I'm aware of its existence, my insurance agent is going to check mine in a few weeks to see how this accident will show up and if there are any mistakes that I need to fix.