CHARLOTTE, NC – Diane Vaglio loves the outdoors, but it doesn’t always love her back.
“There was a problem with the flashing over there, and then water came in and left [a] big water mark on the ceiling,” she said.
She says she filed a claim with her insurance company, MetLife.
“So they determined that the damage was $1,008. OK. So they sent us a cheque for $8 because I had [a] $1,000 deductible,” she said.
She says that four or five months later, “the tree was over here … it got hit by the lightning and then it split in half and made a mess of the yard”.
So she says she filed another claim and MetLife paid $500.
Then, about seven months later, “I get the letter saying we’re dropping you,” she told Action 9.
“It’s like, why are you dropping us? They said, ‘Well, because you filed two claims last year,'” she said. “I have almost perfect credit, I’ve never missed a payment, and in the 10 years we’ve had MetLife, I’ve given them over $30,000. And for $508 they’re dropping me?”
Vaglio says she offered to return the $500 and/or the $8, but the insurer wouldn’t take it.
“So then I started calling other insurance companies and they looked me up. ‘Oh, you’ve just been dropped. You’re on the list,'” she said. “I’m like, ‘The list?’ I’m like, ‘What do you mean?'”
MetLife wouldn’t discuss her case with Action 9. But it’s not just this company. Chances are, yours is doing the same thing.
Mark Friedlander is with the Insurance Information Institute, the group that speaks for the insurance industry.
Action 9’s Jason Stoogenke asked him if it was fair. “You have insurance for a reason, but then you’re kind of punished for using it, right?”
Friedlander says that filing two homeowners claims in a short period of time usually raises a red flag and labels you a high risk, even if you have never filed a claim before. “It’s all about risk,” he said. “For us, it’s a very fair process. Higher risk means higher cost.”
Stoogenke has noticed a lot of people venting about this on social media recently. One person posted about her experience and it led to a flurry of comments, including from Vaglio.
That said, your insurer can’t usually drop you in the middle of your term, but they can wait until your term is up and not renew you.
“They’re in business to pay your claims,” Friedlander said. “If it’s something that’s covered in your policy and you make a claim for it, you should get the claim paid.”
But as Stoogenke points out, the flip side is that you may not end up getting renewed.
“But they’re not going to tell you, ‘You know what? Pay for it out of your own pocket. It’s better for you in the long run. That’s not the obligation of the insurance company,” says Friedlander.
As Vaglio mentioned, insurance companies share this information with other insurers – even their competitors. They do it in a national database called C.L.U.E., the Comprehensive Loss Underwriting Exchange, and it keeps your information for seven years. Friedlander says companies may not consider you a high risk all that time, but you won’t be officially taken off the list until it expires.
Vaglio says she didn’t have many options after that. She says her best option was to see if MetLife would keep her if she paid a lot more. She says that’s what happened.
She says she finally got off the C.L.U.E. database list years later, then changed companies, and now she wants to warn others.
Advice from Action 9:
If you have already made one home insurance claim this year, think carefully about making a second one. If you can afford to pay it yourself, you may want to do so.
Ask your agent if a second claim could cost you your renewal later. Agents don’t have to give you this information, but they should be honest if you ask.
If your insurance company drops you:
In North Carolina, it must give you written notice 30 days before your policy expires. In South Carolina, it’s 60 days. This should give you time to shop around.
If you use different companies for home and car, be sure to see if the company with your car policy will add your home policy. They like to bundle.
All consumers are entitled to one free quote every 12 months. To make an enquiry, you will need to provide your first name, last name, street address, town, postcode and date of birth. Depending on the type of request, you may also need to provide either your social security number or your driver’s licence number and state. “The information you provide will only be used by LexisNexis Risk Solutions to verify your identity and process your request,” the company told Action 9.
This can also happen with your car insurance, but it’s much less likely because insurers use different formulas to assess the risk of these claims. Insurers report both home and car claims to C.L.U.E., but the database tracks them separately. In other words, if you have a car claim and a house claim close together, you won’t be flagged as a high risk.
