The Insurance Information Institute predicts that homeowner’s insurance will rise 8 percent in 2004, mainly because of natural disasters and rising construction costs. In 2003, the cost of such coverage rose by 7 percent.
To anticipate insurance problems, home buyers should request a copy of the house’s insurance claim history before making any commitments. So-called CLUE (Comprehensive Loss Underwriting Exchange) reports can be purchased for under $10 from ChoicePoint, while similar reports called A-PLUS are available from Insurance Services Office,
These reports (accessible to home sellers but not buyers) list all insurance claims from the past five years. If you’re buying, check to see if damage has been adequately repaired. If a burst pipe caused water damage, for example, you should ask to see the replacement pipes. If the roof was damaged from a falling tree limb, make sure the roof was repaired. These reports can also alert a home buyer to patterns of damage and may indicate whether insurance will become more expensive.