An excellent reminder to all of us. I use them extensively - especially with so many foreclosures available. It's crucial to know whether the property is even insurable prior to writing the offer. And people are often shocked by their own profile. Your reference is invaluable! 

Thanks, Diane.

Real eye opener!

Does it hurt your score just to obtain a copy of your own CLUE report?

Can a buyer request a CLUE report to making an offer?

It's unfortunate that only the seller/owner can order it. When representing buyers I've often put in the offer that the seller needs to provide a CLUE report, but most agents aren't aware of what it is and thus advise their sellers against it.

I have had buyers, sellers, and agents look at me like I've lost my mind when I mention clue reports. When a seller refuses to provide one, I have to wonder what they are trying to hide.

"My reaction was astonishment. How could any active Realtor today not have even heard of a CLUE Report? "

I guess it's time to be astonished again.  Never heard of them. Have not encountered them.  Everyone that I've dealt with has had no problems with insurance.  HUM....should I research them?

Diane - Many Western NC Realtors are well educated on the C.L.U.E. Report. I wrote a email drip campaign that included information on this important topic for a client who uses it to inform her buying and selling prospects.

Your post is very organized and informative, well deserving of being featured. Congrats!

C.L.U.E. reports can be informative, but not a substitute for an agent who is active in the neighborhood. The report only goes back 5 years.

thanks. I am like the brave realtor. I did not know that it existed. Thanks

Good reminder.

I always warn my buyers and agents about C.L.U.E. but it seems to be some kind of reflex for folks to file claims for the smallest thing.  Unless the siding is ripped off your house, you'd better be making repairs yourself.  Water damage, NO, NO.  Not only will your rate go up, but if you sell, your buyer may not get coverage.

Insurance is becomming so costly and so limited, it costs more now than taxes in some areas around here.

Diane, Yeah, I learned the hard way also. My insurance was cancelled because of a claim. When I tried to get other insurance, I was turned down everywhere. It soon became clear they were looking at something that resembled a credit report and that I was POND SCUM.

Only then did I realize that you pay your premiums for years and years to the tune of thousands of dollars, but God forbid you should file a claim, or even TALK TO THEM about a claim. They will cancel you so fast it will make your head spin and no one else will touch you.

AND YOU DIDN'T EVEN DO ANYTHING WRONG. At least if I have a bad credit score, it is because I didn't pay my bills. THIS is at least understandable.

NEVER EVER SAY MOLD to an insurance company. You'll be toast. And Lord help you if your dog bites someone, or a trespasser sues you because they were "hurt" while theY trespassed on your property.

The whole thing SUCKS AND IS SO UNFAIR.

I have been including a paragraph in the P&S requesting a copy of the clue report from the seller.  We have a lot of ice damage in NH -- and recently a lot of flooding!  Not only are most Realtors (r) totally unaware of the report, but they often give me a very hard time -- it is incredible -- I don't understand that mentality!

This is a great, informative post, but I'd like to clarify something. Having been an insurance agent prior to getting into Real Estate, I'm fairly familiar with CLUE reports, although I'm sure there have been some changes and adjustments to them since I got out of the business a few years ago.

You're basically referring to two different things here, when they are really very seperate. The CLUE report is like a credit report for the property. It's a report that shows any past claims on that property. Data is also recorded through CLUE about individuals, helping the insurers to identify fraudulent or habitual claims activity. That's CLUE in a nutshell.

You also made several mentions about personal credit reports, bankruptcy, etc. Those issues don't have anything to do with CLUE. However, they are used in determining the insurable risk of a potential or current client. That's where the possiblity of higher rates due to bankruptcy come in. Personally, I've never agreed with this system of rating, but it's become mainstream throughout the insurance industry. Your credit and your ability to pay your bills WILL affect whether or not you get the best rates available from your insurer, but it will not determine whether or not a certain property is insurable.

Your best bet is as Lenn mentioned above. If you're going to file a claim, you better make sure it's ABSOLUTELY NECESSARY. If you can avoid it and pay out of pocket, DO IT. The large, catostrophic claims are the only ones worth filing.

Hi,

We've been using CLUE reports ourselves for a few years now. As far as I know it's like Sharon said, the seller orders the report and some agents are still clueless when asked for. Now a question on REO's is there a problem obtaining a report on these?

As for turning in an insurance claim, that's about the last thing I'd do myself. I raised my deductible to $5,000 to cut down the cost of my annual premium.

Jennifer:  Thanks!  I was hoping to reach those who didn't know about CLUE reports...until that meeting I thought everyone did.

Dan:  From what I understand, it can hurt your score to make an inquiry about a possible claim but not to order a report.  The seller is the only one that can request the CLUE report for their property but the buyer can request their scores to find out how their insurance rates will be accepted.  I suggest you talk to a good insurance agent in your local community to get specifics as there are some state laws as  well.

Sharon:  Thanks for sharing your experiences.  Because of the earthquakes, mold etc. it was greatly discussed where I used to live in Pasadena CA. but after reading these responses I'm realizing that agents in communities that haven't had significant problems simply aren't aware of them....yet!

Jeff,  Great to know, you will be my go-to person.  Feel free to provide a link so others will know how to find out more!

Suzi, The sellers can't hide for long, as you know once a buyer applies for insurance they will find out.  I think all listings should provide CLUE reports upfront so that there are no surprises later.  Thanks for sharing.  You are really on top of this issue!

Judi:  Thanks for your honestly.  I would definitely recommend reading the information on the links I provided or talk with one of your local insurance agents.  It really is important that you are informed...and maybe you can capitalize on your knowledge in your marketing!

Bobby:  Thanks so much Bobby!  Great to know that your area is so well informed and that you are sharing your expertise with others.

David:  I'm with Jeff Link on this one.  I can't see how being active in a neighborhood will give you access to the kind of information in a CLUE report.  You  would have to know about every small claim that might have been filed, not just major problems.  Even then, you won't know the score, and how in will impact insurance rates.  Your knowledge of the neighborhood can definitely shed light on patterns or long-term problems so it is great that your know your neighborhood so well.

Christopher:  Thanks for sharing.  It gives us a better idea about how many agents don't know.  You are brave too!

Tracy:  Thanks, since you are in CA I'm sure this is second nature to you!

Jeff:  Thank you so much for your insight and response to David.  I agree!

Lenn:  You are SO right, especially about water damage!  It's hard for some homeowners to grasp that even though they have insurance they shouldn't use it except in a dire emergency.  Insurance was so a huge issue in California, especially after the Northridge earthquake.  There were times when the state had to step in just to provide insurance.  Thanks so much for sharing!

 Being an Insurance agent, I have come across properties with a previous loss history on the property that won't be insured to the new owners by many insurance Co's., that we do insure. I like that we can help close your escrows!  Loss records come up automatically on our system, so no surprises and most are easily handled by the agent. 

 I can only speak for Farmers, but we do not use credit reports for insurance.  This is very important for a Realtor to know when someone is applying for a home loan. Those credit report hits can kill the credit score.

Janet:  I feel your pain!  Thanks for sharing.  The more stories are shared the more all agents will understand!

Joan:  Thank you for yet another example as to why CLUE reports are so important!

Ryan:  Thank you so much for the clarification.  I think I could have done a better job of explaining the various roles the scores play.  Great job of doing this for me!  And again, we all agree about not filing a claim unless it is unavoidable.  It doesn't seem right does it?

Lynda:  Good question about REO's.  I think the buyer will need to know upfront whether they can get insurance and at what rates.  My personal opinion is that lenders should provide a CLUE report as it is in their best interest to avoid problems later on.  However, I don't know how this is handled today.  Anyone want to let us know?

Terri:  Thanks for sharing, that is great information!  When I had my problem years ago I could only get the Lloyd's of London type of coverage so it is good to know that Farmers has options available!

OK, sorry to seem argumentative... it's really not my style, but Farmers is the company I worked for, and they DO use credit as part of their process for determining their rates (at least in OK, I can't speak for every state) and those inquiries DO NOT affect your credit score. There are different types of inquiries, some that will lower your score and those that will not. An insurance company's inquiry will not affect the score, because it's not seen as an application for credit, but rather an inquiry for underwriting of insurance. I think everyone definitely needs to be aware of CLUE reports, but the information given needs to be accurate and everyone needs to realize this is NOT something to get in a panic about or start believing this is going to throw a monkey wrench in every deal you have going.

 Diane, I'm so sorry and I'm sure you paid through the nose for your Insurance. I have never used my insurance and have a high deductible. If I have a minor problem, I plan to just pay for it. Some of the claims I have seen could have been avoided through maintenance. I have a couple of issues in my home that I really have to keep an eye on. New Construction 5 years ago, but built on a 60 degree grade with a 25 ft high retaining wall with caissons on the back of the property. I have to maintain the drains and make sure my rain gutters are kept clear. Also have the fire sprinkers to maintain and a very important factor to watch on these homes built on grades is to make sure the Water regulator from the water pressue from the street doesn't overburdon the water pipes. I have it checked annually and have had to have it replaced twice.

I don't know if water pressure is checked by Home Inspectors, but should be and can save the pipes according to the plumber that works on our home.  

This post has generated my interest to make a call into a claims adjuster for more info to share on the subject.

Ahh Ryan, do they still use credit in OK? They don't in Calfornia, but they used to and I have had clients not want to move forward on their Homeowner Ins. when purchasing a new property, even when our rates are lower because of the Credit check. Perhaps I should have clarified I work in Ca. 

I have heard of it...and it could play a role in the insurability of the property.

I called our Policy Processing Dept. and they couldn't comment on credit checks done in other states since we don't in Ca., but did agree that keeping a higher deductible with your Fire Ins. polcy is a good Idea to keep premiums down and try to take care of the smaller losses yourself. Any loss, no matter how small can affect your Premium (in Ca. w/Farmers up to 30% increase in Premium for 3 years.) I have Homeowner Insurance to protect our home in the worst case senario. Like our Autos, maintenance and Insurance is all part of the deal of ownership.

My husband and I both have Life Ins. as well. We take care of ourselves, but I'm a lot more expensive to maintain than he is, lol. Hopefully it's not going to be needed for a long long time.

While we are on the subject on losses and how it can affect you. Many Agents and Brokers have employees and subject to our wonderful Workers Comp Laws in Ca. Check your policy or State fund ofice to see what you can do regarding paying for first Aid and keeping these loss's off of your Loss counts. The small losses take a bigger bite out of your rate than large losses, because they are rated differently. There is criteria to what is first aid and what is not. Most of my homeowners are also business owners. I like to offer help in all areas of their life whether they are insured with me or not.

Have a great day everyone and Thank you Diane for bringing this subject to AR

Very good read and a great reminder to any and all in the business that it's our job to protect our clients.

Ryan:  No need to apologize as there are many variables to this subject and it is important that everyone understands that they should contact their local insurance companies to find out the details about their community.  There is certainly no need for undue concern unless you are in a crisis market after a major earthquake or flood but even then we got through it.  I never lost a sale because of insurance but it sure helps to know up front if there are going to be issues.  Thanks again for your input!

Terri:   Thanks for your advice and input.  Believe it or not, my claim was for a minor break-in when some teens took my daughter's CD collection and a cell phone.  This must have been back in 1999 but I was shocked to find out what a heftly price I paid for such a ridiculous claim!!  Thanks too for all of your great information!

Aaron:  Thanks!  Not a very sexy topic but one I thought might be meaningful to some!

Oh Diane, that is such a shame. When I called Policy Processing, I even brought up a point when I was a teen, someone stole my uhhem....10speed. My Parents made a claim to the Ins. Co. and within 2 weeks, had a new bike. I was told that those were the days, but now, it just doesn't work that way.

Diane, if it helps at all, when our Son was 12, older boys in the neighborhood were scamming all the little kids and ripping off homes as a team. Cd's, Video Cams, you name it. It moved, it was gone. After making the police report, the alternative school hoodlums (for asaulting a teacher) waited for our Son to get off the bus and broke his jaw. The guys were 16 and 17 in a very nice respectible community. I don't mean to remove any of your "burnt feelings" towards insurance, but after surgery and our Son's mouth wired shut for 6 weeks and having to move, you did not do so bad. I had to get our Congressman involved for them to even see a court and a few days in Juvinile hall. Times are changing, that's for sure. Our whole world is moving at such a fast pace. Hopefully our stories will help others now that we have AR.

A lot of homeowners have never heard of them. That is why they need agents :-)

Excellent reminder and a great way to establish yourself as a marketing expert.  No one else in my market would mention a CLUE report.  I think I will start to incorporate it and see what the results are like!

Interesting post and comments....is this report used in every state? 

I have ran into problems with CLUE.  For awhile they were dinging people for calling and asking questions.

Terri:  I am so sorry too.  I can't imagine how awful that must have been for you.

Bob and Carolin:  Exactly!

Chris:  I know it's not a sexy topic but when I realized some agents didn't know about them I decided to write the post.  Thanks for your comment!

Kathy:  As far as I know they are, but check with one of your local insurance agents to be sure!

Ki:  I have heard that.  It reminds me of the old days when FICO scores were impacted by inquiries.  I would just counsel clients not to call about a specific claim but I think it is safe to call and ask general questions.  Again, I would recommend that your call a local insurance agent to find out for sure.  Thanks!

Ki, I had the same thing happen back when I was still an agent. I got to where I was very careful not to give specific information when calling to ask questions. If I gave client info, an inquiry was considered a claim, whether anything was paid out or not. I had a real problem with that!

Ryan:  Great input and advice.  Thanks!

Ryan:  Great input and advice.  Thanks!