Searching for CLUEs: What Homebuyers & Sellers Need to Know About Homeowners Insurance

Homebuyers and sellers should be aware about issues involving homeowners insurance and the C.L.U.E. database. C.L.U.E. stands for Comprehensive Loss Underwriting Exchange and is a collection of homeowners insurance claim history enabling insurance companies to access five years worth of prior claim information to evaluate risks. The database is maintained by Choice Point Inc., a private Georgia firm, and contains over 40 million claims records on houses in all 50 states. Over 90 percent of insurers providing homeowners coverage provide data to the CLUE system.

In the same way that having a bad credit record affects your ability to finance a home, negative information in the CLUE database can affect whether a purchaser can get a homeowners insurance policy and at what cost. Many homebuyers are facing the grim reality of the decreasing availability and affordability of homeowners insurance. When a homeowner applies for insurance on a property, the insurance company will usually check the CLUE database to see what claims or reports of damage are on file about the property, and may charge higher premiums or possibly decline to offer insurance coverage. Without homeowners insurance it is nearly impossible to obtain a mortgage loan and in most instances a sale will fall through. Sellers of properties who never made an insurance claim but only lived in the house for a short period of time may be unaware of potential problems because of claims made by the prior owner. Another problem arises with "zero-dollar" claims which refers to things that did not result in a loss for the insurer being listed as a claim in the CLUE database, such as a homeowner calling the insurance company about possibly filing a claim, even if the claim is never filed.

The National Association of Realtors® believes that home sellers, buyers, and Realtors® need more education about CLUE. Homeowners and sellers may obtain the CLUE report on their property from www.choicetrust.com for $12.95. It is important that sellers review this report carefully to correct any inaccuracies which may inhibit a new owner from obtaining homeowners coverage. For buyers, it is critical to find out the claims history of a property before purchase by requesting a copy of the CLUE report from the seller in a contingency clause in the contract. Getting a C.L.U.E. report as soon as possible during a real estate transaction will help ensure that buyers and sellers do not receive unpleasant surprises at the last moment causing unneeded stress and delays and possibly causing a sale to collapse.

Brian Block is a Realtor with Re/Max Allegiance in Alexandria, Virginia. He is also a real estate attorney. He can be contacted at 703-626-0715. If you or anyone you know has real estate questions or is looking to buy or sell real estate in the Northern Virginia and Metropolitan D.C. area, contact Brian Block. For more information and to start your home search, visit his website at http://www.brianblock.com

Meet the real estate broker’s interns: an ambitious group willing to do anything, earn nothing and wake up early on a Sunday to fluff the couch cushions at open houses.

In Manhattan, parking lots and garages are making way for all sorts of development, especially luxury condominiums.

Gray Burton lives in a 250-square-foot space he furnished with antiques he’s been collecting for years.

MacKenzie Thompson’s plan to buy a multifamily house in foreclosure did not pan out. She decided to buy a home in Westchester County.

A photogenic Westchester suburb with high-profile residents is also known for its art museum and a performing arts center.

A Ditmas Park co-op, Upper East Side co-op and an Upper West Side condo.

A 10-year-old house with six bedrooms in Montvale, N.J., and a renovated four-bedroom in Bronxville, N.Y.

Wealthy investors are wiring millions of dollars to New York to snatch up a piece of 157 West 57th Street - what will be New York City's tallest residential building, with 90 floors overlooking Central Park.

An apartment at the Trump International Hotel and Tower, opposite Central Park, was bought anonymously through a limited liability company.

The anchor of a proposed historic district will surely be a clutch of four mansions at Riverside Drive and 72nd Street.

Success in challenging property taxes means not having to put as much money aside in the escrow account.

Taking responsibility for a roof leak; a bank loan for capital repairs; lender says no to co-op sublet; next time, don’t forget the key.

Summerview Square is a town-house-style apartment project going up in Norwalk after a previous developer walked away, leaving squalor in his wake.

A drop in prices and low interest rates means many buyers on the Island can afford to wait.

In Hudson County, developers are working on several projects that would add thousands of units in waterfront communities like Hoboken, Jersey City and Weehawken.

A development in Austin, Tex., is an ambitious attempt to upend the conventions of the American subdivision.

A town house in New Orleans, a penthouse in Baltimore and a ranch house in Washington.

Housing prices continue to fall nationwide, with Atlanta earning the distinction as the weakest performer.

The financial crunch has been felt in Aruba, but not severely enough to cause large numbers of foreclosures and short sales.

A new law that allows businesses in Philadelphia’s Market East district to draw revenue from large digital signs has drawn attention from developers.

With its concentration of pharmaceutical giants and academic powerhouses, the region could be a major center for life sciences businesses, developers say.

The president of the New York Building Congress, which represents professionals in the construction industry, has been running the nonprofit association since 1994.

A frenetic little industry has taken root in New York City based on finding and publicizing the once-and-future homes of just about anyone with name recognition.

The plan for a business improvement district in SoHo would help with the trash problem, but some residents don’t want to cede more ground to tourists and real estate titans.

A Ditmas Park co-op, Upper East Side co-op and an Upper West Side condo.

A 10-year-old house with six bedrooms in Montvale, N.J., and a renovated four-bedroom in Bronxville, N.Y.

Properties in New Orleans, Baltimore and Bellevue, Wash.

You want them, you need them, and these power tools will pay for themselves.

One man’s discovery of the vast powers of the drill.

An abandoned log house with a sinister air, the Smith Mansion in Wyoming is the stuff of legend.

Chris Hacker, the chief design officer at Johnson & Johnson, shops for hot water bottles that can come out from under the covers.

Should I remove the family photos hanging on my wall before listing my apartment?

An architect and an interior designer have created an online database of hazardous building materials.

The handmade house, doughty and particular, is being celebrated in three new books.

Beginning Friday, the NoLIta store Haus Interior will host Wood Shop, a pop-up store created by David Stark.

Compare the cost of renting and buying equivalent homes.