What’s an Insurance Consumer Report?

I recently discussed insurance scores and credit reports and how they are used in insurance underwriting in other articles.  But have you ever wondered why other reports insurance companies use when making decisions?  It’s certainly much more than a standard credit report.

Auto and property insurance companies use claim’s databases for underwriting purposes.  These databases are considered “consumer reports”, compiled by consumer reporting agencies and are regulated by the Fair Credit Reporting Act (FCRA). Per the FCRA, consumers are entitled to one free report annually from each agency that maintains and sells these reports.

Two companies compile insurance claim information – Insurance Service Office (ISO) and LexisNexis.  Most insurance companies report their auto and property claims information to both companies.  LexisNexis is more widely used than ISO.  They used to be known as ChoicePoint and before that they were known as Equifax Insurance Services.  LexisNexis now owns the data through an acquisition of ChoicePoint.

The data reported to both companies is similar, which includes policy information such as name, date of birth, Social Security Number and policy number, claim information such as date of loss, type of loss and amounts paid, and a description of the property covered.  For homeowner’s coverage, the report includes the property address, and for auto coverage, it includes specific vehicle information.  Insurance companies usually use the information to underwrite new policies on which they don’t have any information.  The claims information stays for five years from the date the loss was reported.  Loss history information is stored in these databases; no other data is included such as credit reports, criminal records, civil lawsuits or legal judgments.

LexisNexis

LexisNexis’ claims history database is called C.L.U.E. (Comprehensive Loss Underwriting Exchange); there are two separate databases, one for property and the other for auto.  Only insurance companies that contribute can also purchase the reports.  You may still be more familiar with the name ChoicePoint; LexisNexis purchased ChoicePoint in 2008.

ISO

ISO’s products are A-PLUS Auto Database and A-PLUS Property Database.  Insurance companies can purchase the data and don’t have to be a contributor.  Claims data includes both personal and commercial auto and property claims.

How do you order your insurance consumer reports?

LexisNexis CLUE reports are available at their website at www.personalreports.lexisnexis.com or call 866-312-8076.

ISO A-PLUS reports are available at their website at www.iso.com/products/a-plus/consumer or call 1-800-627-3487. Reports are sent by mail only and you receive them within 15 days of request.

I would advise that you get your claims report from both companies and make sure that the information is correct. If not, you should dispute the information.  The reports are free and errors can impact your rates or even decline you insurance.

John Ulzheimer is the President of Consumer Education at SmartCredit.com, the credit blogger for Mint.com, and a Contributor for the National Foundation for Credit Counseling.  He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry.  Follow him on Twitter here.

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