If you’re buying a home, you should ask about its insurance claim history before you sign the dotted line. You could gain valuable information that will help you decide whether the home is a good choice for you.

Buying a Home? Find Out About Its Insurance Claim History First

A house’s history of insurance claims can affect how much you’ll pay for coverage – even if you didn’t live there when the previous owners made a claim. Here’s the deal, though: Asking this question is important because if a house has been through past damage, it’s got a higher risk of other issues in the future. For example, a home that’s been damaged in a flood may have a higher risk of mold in the future – and if you know that the previous owners made a water damage claim, you can make a more informed decision about whether to buy it.

How Do You Find Out About a Home’s Insurance Claim History?

You can ask the seller for a copy of his or her CLUE Report. A CLUE Report – that’s an acronym for comprehensive loss underwriting exchange – can tell you all the insurable incidents that have occurred related to the home within the past 7 years.

Here’s what else you need to know:

A blank CLUE Report can indicate that the homeowner didn’t make any claims or that the homeowner’s insurer doesn’t participate in CLUE
You need to ask for CLUE Reports from each owner over the past 7 years
You may still have to ask the seller questions after reading a CLUE Report – because although it’ll tell you what claims were made and how much the insurer paid out, it won’t explain each

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