We learned a lesson about homeowners insurance the hard way this spring when buying/selling homes. We had coverage through USAA for years and they have a lot of our business - car loans, home loan, credit cards, bank accounts, car insurance, home owners insurance, umbrella insurance, etc. We're very happy with them and the service. But, when we went to close on our new home, I called them to cancel the policy on our current home and to add one for the new home. Since the price of the new home was above what they cover with a traditional policy, we had to talk about using their partners. After a quick chat/review, we were told our application was rejected because we filed too many claims against our homeowners insurance previously. I was stunned. It is true we filed about four claims in three years, but all of them were related to the roof (this is on a new construction home less than 10 years old). The final claim resulted in a new roof (which was dilapidated due to wind/rain damage). During that time, our premiums never went up, our coverage never changed, and no one said anything about the perils of filing too many claims resulting in us being a 'high risk' client. To that point, I had never heard of the CLUE Report (which is basically the database of homeowner insurance claims and works similarly to a credit report - if you have too many, you're not worth covering, and it stays with you for 3-5 years).
Anyway, after hearing this and only days away from closing (and knowing our purchase of the new home requires us to have insurance), we called every company we could think of to get insurance - and they said the same thing - too high risk, too many claims. Fuming, I wrote a letter to USAA telling them that yes, while we're guilty of filing the claims, we were a) never advised against filing them, b) never had our premiums go up or coverage dropped, and c) had ever heard of CLUE. I also mentioned that the money they've spent in paying homeowners claims (less than $20,000 including the new roof) is small fries compared to what they've made off us. I received a call from a 'client advocate' who said they will personally review our case to see if the wrong decision was made. Ultimately, they sided with their 'statistics' and stood firm. We ended up getting coverage via our lender at the last minute which is fine, but I'll probably move back to USAA in a few years when the previous claims have dropped off the CLUE. Lesson learned. If the damage is less than catastrophic, don't file if you can help it.
