I have this old, old car that decided to break down one fine day so I called my mechanic and he asked for that car to be towed to his shop. I had AAA before but then about a year back, I shopped the insurance marketplace and got a better deal with GEICO so I switched. On a side note, if you have not re-shopped your auto and home insurance policies in a while, I say make that effort. An hour spent could amount to hundreds of dollars in savings each year. But not to digress, that insurance I got with GEICO came with roadside assistance so I dropped that 50 dollars more each year I was paying to AAA for that service. GEICO then dispatches the tow service for that sad looking car. Car fixed and all’s good. GEICO good too.
A couple days back during my usual bout of research (aimless browsing), I came across something called a Comprehensive Loss Underwriting Exchange report or a CLUE report for short. We have all heard of credit scores and reports but probably not a lot of us are aware that there is this another set of records being kept on us but this time by insurance underwriters through a company called LexisNexis. That’s the same LexisNexis that runs your background check every time you change jobs. Insurance companies use the information in a CLUE report to price your auto and home insurance policies. So what’s the big deal? That towing service I called could likely show up on my CLUE report and I thought I had a deal. That “claim” could cost me a lot more in increased premiums over many, many years instead of that 50 dollars I could have paid to get that roadside assistance from AAA. And too many of these claims and you could suddenly become uninsurable. Or be ready to pay through the nose for that insurance.
So what kind of data is being collected in these CLUE reports? A personal property report usually linked with your home and/or rental properties provides a seven year history of losses associated with an individual and those properties. For each claim, the report records the date of loss, loss type and the amount paid along with general information such as the policy number, claim number and insurance company name. The insurance premiums are priced more based on the history and the condition of the properties than the individual’s history. Unless of course, the insured is a serial claimer and the pricing algorithms the insurance companies use sorts that out.
The CLUE auto report on the other hand provides a seven year history of automobile insurance losses associated with an individual and not the car. And just like before, for each claim the report records the date of loss, loss type, and the amount paid along with general information such as policy number, claim number and insurance company name.
You have access to one free report each year and I say, you get one to make sure that what they record is what they should record on you and your properties. Use this link to get yours.
And you better ask for one on that next home or rental unit you intend to buy because that can reveal a lot more about the history of that property than what comes out though the usual inspection process.
As far as my incident is concerned, GEICO claims that they don’t report ancillary services used to the CLUE database so that’s good. But that is an exception to the rule. Your insurance carrier is likely reporting these incidents so you need to do your own homework.
And there goes an hour from your otherwise happy weekend.
Image credit – Paurian, Flickr