January 12 , 2004

You Oregon homeowners will definitely want to know about this, and you homeowners outside Oregon are either in for it, or already have it. I believe California has forbid it.

What is it? It’s called a C.L.U.E. Report, and it is used by every Oregon insurance agent to “score” you and your home claims history before an insurer will agree to insure your home.

I didn’t know about it, because I haven’t shopped my homeowner’s insurance for a couple of years due to the fact Safeco has kept my rates reasonable, but when I got this year’s renewal notice it was obviously time to shop around.

The first thing that alarmed my wife and me was that every insurance agency wanted both of our social security numbers to run through the C.L.U.E. report to “score” us. We at first refused to give our social security numbers out of concern for identity theft exposure, particularly since we had no idea who worked in each office, such as clerks and secretaries, who might be taking the information to sell to others. But we ran into a brick wall: Not a single agency would give us a quote without us first giving them our social security numbers! No social security number, no insurance; ya got that baby?

Okay, so then we found out that Safeco, our personal and private home insurer, gave our personal claims history information to the C.L.U.E. Report. To my knowledge, I never gave Safeco permission to give any third party information about claims I had filed against insurance I paid for in total -- but they clearly did. In fact, all the insurance companies in Oregon are feeding their clients’ claims history into that C.L.U.E. Report so every insurance agency can see your claims history when they evaluate you and your home for coverage. How do you like that?

While it is true insurance business in every state is controlled by a state department of insurance or something similar, the State of Oregon had absolutely no right to authorize my private insurance company to divulge my claims history to a third party. If I want to divulge my claims history, I’ll give personal permission, and no state has the authority to violate my privacy in this manner. I pay for the insurance entirely out of my pocket, and I purchase my insurance from private insurance companies. The state had no authority to allow my insurance company to divulge my personal claims history to a third party, and I’m going to assure you one and all: Something is going to be done about this, and I want blood, both from my insurer and the agent who failed to inform me about this hideous violation of my privacy.

In practice, the C.L.U.E. Report is a tool of coercion. In my case, I suffered a pipe break behind my refrigerator, which flooded my hardwood kitchen floor while I was out of town. The floor was ruined by the time I got back. Around that same time in 2001, we discovered that rain water had seeped through a deck facing and had warped a wood window below. There was some other very small claim – less than $300.00 – and I can’t even remember what it was.

Okay, so we had three claims in 2001, and none since. But because we had three claims in the past three years, nobody would insure us, which meant we were forced to stay insured with Safeco at their higher rates, and hence, the coercion not to file legitimate claims as they arise.

Just think: Had Safeco decided to cancel our insurance, the C.L.U.E. Report would have prevented us from being insured altogether for a house that is paid for, and modestly valued at $350,000.00. If the house burned down or was destroyed in an earthquake, then too bad, so sad for the Wordens. Bullshit! In practice, this is what is going on in Oregon and probably elsewhere, and it needs to stop right now. The opportunity for insurance companies to abuse consumers with this axe is just too tempting to resist, therefore we need to take the axe away.

I see a number of remedies, but the most appealing is a mass, class action lawsuit against the State of Oregon and every insurance company that gave personal claims history to a third party without the knowledge or consent of the clients. I believe the insurance companies knew, or should have known, that the state had no authority to give them permission to disseminate the personal claims history of their clients to a third party – clients that every insurer knows are to be protected by the insurer in a fiduciary capacity. That isn’t happening in Oregon, and the insurance companies and their agents should be held just as liable for this travesty as the state itself.

I will keep you posted.

Carl F. Worden

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