What Is an Experience Letter for Insurance?

What You Need to Know About Experience Letters for Insurance

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An experience letter is written by an insurance company that has covered you in the past. The letter details your record with them.

Learn more about experience letters in insurance. Discover when you might need one, what it includes, and how it can save you money.

What Is an Experience Letter for Insurance?

An experience letter can help you prove your insurance history. This is helpful when you are looking for new insurance. It can also be useful when you move to a new country and want the best rate possible.

Sometimes insurance providers may not want to cover you. This is often true if you haven't had insurance for a while or have factors that make you a risk to insure. An experience letter is a way to prove that you are a safe risk.

  • Alternate names: letter of experience, letter of claims experience, proof of prior insurance

How Experience Letters Work

You can think of an experience letter like a letter of recommendation for an insurance company. This is your former insurance company's way of "vouching" for you. It is often sent to new insurance companies that do not know you.

The letter will outline what type of coverage you had and for how long. It will include any claims or lapses in coverage.

Having a letter of experience that shows a strong history of coverage can provide you with insurance discounts. This is most true if you don't have many or any claims. It can also help you get insurance if you are having trouble finding someone willing to cover you.


All you need to do to get a letter of experience is to ask your insurance company. Don't worry if you haven't been insured for a couple of years. You can still call your last insurance company and ask them to send you one.

Here's how experience letters could help you save money on your insurance: When an insurance company sets the cost of your insurance or yearly premium, it will look at many factors to come up with the price of your plan. These include personal information like risk factors or your insurance credit score.

The company will also consider your insurance history. This means how long you've been insured and how many claims you've made. Insurance history is where experience letters come into play.

Who Needs an Experience Letter?

If you've always been insured in recent years, you probably won't need a letter of experience. That's because this process is mostly done by a program called the Comprehensive Loss Underwriting Exchange (CLUE).

Insurance companies report your history to CLUE. When you sign up with a new insurance company, they will request your CLUE report. This allows them to check your information.

If an insurance company needs a letter of experience, they often will ask for one. Common reasons for this include:

  • Moving to a new country
  • Lack of insurance for a few years
  • Further need to prove or dispute claims on record
  • Never being the primary person insured (such as teens, college students, or people who are divorced and used to be on a family member's plan)

If you are having trouble getting covered, you can also choose to provide an experience letter. This may sway the company in your favor.

What Is Included in an Experience Letter?

A letter of experience will contain all the information an insurance company needs to set the cost of your plan. Each insurance company has its own way of creating these letters. Often, though, there are some common things you can expect to find in them.

The letter should include details of what was covered. If you insured a home, it will state the address of the "risk" insured. For car insurance, it may state the vehicle and serial number.

It will also list all the names that were on the plan. This includes the owner of the property or car or the person who held the health plan through their job. It may also include other people, such as when a car insurance plan covers more than one driver.

If a home policy included additional named insured in special clauses, you may request a letter of experience for them as well.

The letter would also detail when you had coverage, such as effective dates and end dates. It may explain why your policy ended. If it was canceled for nonpayment, or if you owe money for your premiums, this may show up.

Any claims paid during the time of insurance will be listed. It will also have details of the cause of the claim and how much was paid.

If you never had any claims, then it should state, "There were no claims paid during the period." If there were claims for more than one person, it should list who was responsible for each one. You may request separate letters for each person.

Why Get an Insurance Experience Letter?

The more insurance history you have, the less of a risk you are seen as by insurance companies. That's why things like having renters insurance before you buy your first home insurance plan can save you money.

When you can prove a history of being insured, it will often result in lower costs. This is most true if you can prove you haven't made many claims.

Multiple small claims may make underwriters nervous about insuring you. On the other hand, seeing you had no claims will often get you a discount.


Not all insurance companies require an experience letter. If you are not sure, ask your company if a letter of claims experience or insurance history would help.

When an Experience Letter Won't Help

Even if you took all the right steps and requested your letter of experience, that doesn't change what's included in your letter. It also doesn't mean you will always get cheaper coverage.

Each insurance company has a system for setting its prices. That system means your letter of experience may or may not give you the discount you were expecting.

Your letter of experience may show 18 months of good standing. But your new insurance company may only give a claims-free discount after three years. If that's the case, you'll still have to wait a year and a half to get that discount.

There are many factors that impact insurance company prices. Sometimes subtle things can have a big impact on the price you pay. It's often best to shop around and contact customer service to find the best plan and price for you.

Key Takeaways

  • An experience letter is written by an insurance company that has insured you in the past, much like a letter of recommendation.
  • If you've always been insured in recent years, you often won't need a letter of experience unless an insurance company asks for it.
  • Experience letters contain all the information an insurance company needs to set your premiums.
  • The way in which your insurance company sets prices means that the information in your letter of experience may or may not give you the discount you were hoping for.