What Is a CLUE Report? A Guide for Real Estate Agents

A CLUE report is a great tool to help real estate agents and buyers identify potential insurance liabilities in a house so they can make informed decisions before making an offer. In this CLUE report guide, learn what CLUE reports are, how to get one, and how they can help with real estate purchase decisions.

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What Are CLUE Reports?

A Comprehensive Loss Underwriting Exchange (CLUE) report contains detailed information regarding homeowners insurance claims on a particular property within the past seven years. These claims information reports are generated by a consumer reporting agency called LexisNexis. The agency maintains a comprehensive database of consumer claims information reports submitted by insurance companies that help insurers when they're underwriting a policy. 

While CLUE reports are mainly used to underwrite and rate new policies, they can be an efficient way for buyers to learn more about a property they're interested in. 

What Do CLUE Reports Include?

Along with the homeowner's name, personal details, and policy number, a CLUE report shows the date, type of loss, and the amount the insurance company paid the policyholder for a claim. The report may also include general details about insurance providers and claims. 

Why CLUE Reports Matter in Real Estate Transactions

CLUE reports can provide insight into potential problems within a property. Insurance payouts due to water damage, foundation troubles, and even mold may cause buyers to pause and reconsider the property. When these issues surface, buyers worry about the cost and hassle of home maintenance and the potential for high homeowners insurance premiums. Some may reconsider their offer.  

How to Access a CLUE Report

While CLUE reports are primarily for insurers, homeowners can access a copy of their property's CLUE report for free. 

Thanks to the Fair Credit Reporting Act, homeowners can request a copy of their CLUE report from LexisNexis by calling 1-866-312-8076 or by visiting consumer.risk.lexisnexis.com. 

Real estate agents and buyers cannot access CLUE reports for properties they are interested in. However, they can ask the seller for a copy or make an offer contingent on a clean CLUE report. 

How Long Does It Take to Get a CLUE Report

Homeowners can request a CLUE report once every 12 months. Since reports are issued free of cost to homeowners, they need not worry about CLUE report costs. CLUE report issuers typically provide a free report within 15 days of receiving a request from a homeowner. 

How to Interpret CLUE Reports

A CLUE report with many claims can reveal valuable information to a real estate agent. Homeowners make claims on their insurance for many different reasons. Claims vary by policy and coverage offered. Real estate professionals have an opportunity to look beyond the claim and consider the broader implications. Check out the instances below. 

  • Floods or Storm Damage Claims in a CLUE Report: While homeowners may have repaired past water damage, agents should consider the possibility that recurring flooding can cause mold issues. You may also want to recommend flood insurance to potential buyers. 
  • Break-ins and Theft-related Claims in a CLUE Report: Multiple insurance claims related to theft may indicate security issues with the home. Potential buyers may benefit from a strong security system. These claims could also point to an unsafe or undesirable neighborhood. 
  • Damaged Roof or Foundation Issues in a CLUE Report: Multiple claims involving crucial functional elements of the house could indicate poor construction or poor-quality building materials. One-off claims aren't necessarily a cause for concern if followed by good repair or replacement work. But repeat claims concerning the same issue could be a red flag. 
  • Clean CLUE Report (No Claims): A blank CLUE report could mean that the owner didn't make any insurance claims or that their insurer does not report claims to LexisNexis. A blank report doesn't mean no damage has occurred to the home; it only suggests no claims were filed or reported. A professional home inspection can still bring up potential problems. 
Woman agent reviewing insurance policy with client

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How to Guide Clients Using CLUE Reports

Both buyers and sellers can make use of CLUE reports.

CLUE Reports for Sellers

A client selling their home is encouraged to look at their CLUE report to understand how past claims may affect the sale of their home. Some buyers may perceive a clean report or one with few errors favorably. Discussing claims in a report also gives sellers a chance to be forthcoming about any improvements they’ve made to the home, such as installing a security system or roof repairs. Sellers also have the opportunity to dispute any incorrect information in their report before putting their house on the market. Correcting CLUE report errors in advance can help facilitate a smoother sales process later. 

CLUE Reports for Home Buyers

Buyers cannot access CLUE reports for a home they want to purchase, and neither can real estate agents. However, they can request a copy of the CLUE report from the seller. While a CLUE report or a one-off claim doesn’t always mean the house has had no issues, it may be encouraging to some buyers especially if the homeowner can confirm that they’ve made few or no claims on their home insurance. On the other hand, a report with multiple claims helps prepare them for any potential issues with the house that may come up during an inspection. 

Since a CLUE report may occasionally contain incorrect information, real estate agents should be vigilant while reading and interpreting claims information. Look out for any potential mistakes and have the information verified by a homeowner before dismissing the property. 

CLUE reports can be an excellent tool for real estate professionals representing buyers and sellers. It's important to know how homeowners insurance and claims work, and how best to interpret them. Buyers and sellers may both benefit from an education on how CLUE reports work and how to use them in a real estate transaction.