How Long Do Homeowner Insurance Claims Stay on Your Record?

In the same way that lenders and creditors analyze credit scores to gauge a consumer's risk, insurance companies do. Insurance scoring algorithms consider various factors, including the number of homeowner claims you file and the amount of claims on your record that might increase your insurance risk. The time it takes for a claim to appear on a report varies, but it usually takes between five and seven years.

National Information Systems

The majority of insurance companies pay for a national database service to which they provide consumer information. Insurance companies can access information about any homeowner claims you file from these databases. Companies use the information to assess insurance applicants and provide a risk rating. Other insurance companies can learn the date the loss happened, the type of loss, and the amount of the insurance settlement you received when you submitted a claim.

FACT Act

The FACT Act, or Fair and Accurate Credit Transactions Act, is an addition to the Fair Credit Reporting Act that governs who has access to consumer information. The FACT Act allows you to get one free copy of your consumer insurance file each year. To determine whether insurance clients have filed past claims, insurance companies consult databases maintained by consumer reporting agencies such as CLUE (Comprehensive Loss Underwriting Exchange). CLUE and other comparable databases enable insurance companies to share consumer data on insurance claims history, including property loss claims. You have the right to access and challenge information in your CLUE report under federal law.

Records by CLUE

Insurance firms enter personal information provided by customers into CLUE or other databases. Your address provides an insurance company with the information it needs to research your claims history, which the insurer then uses to determine your risk level. The report also includes your Social Security number, the name of your mortgage lender, your mortgage loan number, and your property address and insurance claim information. Personal property claims information is typically kept on a CLUE report for five years after you report a loss. Some databases may preserve claim data for a longer time.

History of Claims

If your home suffers certain damage, your insurance company may raise your rates or limit your coverage. Water damage, dog attacks, and falls are examples of claims that could raise your rate. When reporting a loss to your insurance carrier, be cautious, as filing too many claims might make homeowner insurance harder to obtain. Some plans also have payout limits. Paying bills out of pocket can sometimes be less expensive than the premium increase you may face if you have a history of submitting minor claims. On an insurance application or claim form, always offer accurate information. Otherwise, your policy may be canceled before its expiration date. An insurance company can also refuse to renew your policy after it has expired, but it must warn you of its decision.