File a homeowner insurance claim?

[rmsmith 1]

Think first before you file a claim or telephone your agent about a claim regarding gear loss. Your homeowner policy should only be used for large losses, or you could posion your own address...forever!

WHEN A CALL CAN HURT YOUR INSURANCE SCORE

By Kenneth R. Harney

WASHINGTON -Did you know that an innocent phone call to your
insurance agent about the deductible on your homeowner's policy
could trigger a loss report on your home to a national database,
even if you never file a claim and pay for the repairs yourself?
Sound bizarre?
Welcome to the emerging Alice-in-Wonderland world of homeowners
insurance, where you have a personal risk score and your house has
its own electronic dossier accessible by insurance companies
nationwide. Depending on what's in that dossier, your house may
already be stigmatized as high risk -- rendering it more difficult
to sell since insurance may be unavailable or extremely expensive.
Worse yet, your ``homeowners insurance score'' could be tainted by
the scoring software's heavy reliance on your personal credit file
-- information that recent national studies have documented to be
too frequently riddled with errors and omissions.
The information is available to the insurance industry in a
privately run database called the Comprehensive Loss Underwriting
Exchange, or CLUE. Insurers who write more than 90 percent of the
United States' homeowners policies contribute information to it,
covering more than 40 million claims records on homes.
Each house has its own file that lists every claim or piece of
property damage information supplied by local agents over the past
five years. Even if the file indicates that nothing was paid to the
homeowner -- where the agent learned of damage below the deductible
threshold through an innocent inquiry by the homeowner -- the file
may contain a loss notation on the property record.
To the insurance industry, CLUE is an invaluable source of
risk-prediction information. In the words of Joe Annotti, vice
president for public affairs of the National Association of
Independent Insurers, CLUE ``is just an automated loss history that
speeds up the process of underwriting and pricing insurance.'' It is
nothing more sinister than the 200-million-plus credit files
maintained by the private national credit repositories -- Equifax,
Experian and TransUnion.
But CLUE reports and homeowner scores can also be unseen weights on
houses and their owners. Houses with just a couple of small claims
listed on a report can suddenly be more difficult to sell. A
homeowner who filed a damage claim on her last property in one state
may find her score too low to qualify for insurance on a new house
she wants to buy in another state.
Both she and her former house may carry insurance stigmas -- the new
scarlet letters of American real estate -- for years.
To see a description of the CLUE system and obtain your home's
current CLUE report, go to www.choicetrust.com. The cost is $12.95.
You can obtain your homeowners insurance score for the same price.
The CLUE system -- and rapidly rising homeowners insurance rates
nationwide -- have prompted the formation of a task force by the
National Association of Realtors. The group is expected to make
recommendations for reforms to the 890,000-strong association next
month at a meeting in Washington.
One of the task force's members, Nick D'Ambrosia of LaPlata, Md.,
cites what he calls a typical example of how the CLUE database can
trigger unexpected problems for homeowners. A report on a house in
Upper Marlboro, Md., included two relatively minor insurance claims
-- one for a ruptured water heater that spilled onto the basement
floor. But, says D'Ambrosia, ``that was enough to stigmatize the
property'' and render it difficult to insure by its unsuspecting
purchaser. Six major insurers turned down the buyer's applications
for insurance.
Another member of the Realtors task force, Nick French of Santa Fe,
N.M., cites the example of a Florida homeowner who mistakenly phoned
his insurance agent to ask about coverage on a fallen tree in the
yard.
``The tree didn't hit the house,'' French said. ``There was no claim
filed.''
But it was listed as a zero-payout damage report on the home's CLUE
file.
The Consumer Federation of America's top insurance expert, Bob
Hunter, says ``for years we've told people to call your insurance
agent and ask questions about your policy. But if questions are
going to be used against you, that's ridiculous.''
How should you handle the tricky new realities of homeowners
insurance? For starters, order a copy of your home's CLUE report so
you know what it contains. If you are buying a home, ask the seller
for a copy of the CLUE report as a contract contingency item.
And perhaps most important: Be aware that even the most casual
inquiry to your agent about property damage could end up as a black
mark in your home's electronic dossier.


Kenneth R. Harney is a nationally syndicated real estate columnist
based in Washington, D.C. You can e-mail him at kharney@winstarmail.com.

[freakydiver 0]

Not to mention with all of the black mold issues lately, do not file for water damage. Many insurance companies are really fearing the black mold and do not want to cover people at all once they've filed for any type of water damages in states where black mold is prevelant...

-- (N.DG) "If all else fails – at least try and look under control." --