Long Nguyen | author
ICHQ | Site Author
Having to leave your home due to severe storm, fire, or water damage is not something that we are always prepared for. When this happens, your only option might be to pack and leave for a safer space until your home is repaired. Finding temporary lodging might strain your finances — unless your insurance covers additional living expenses.
At Insurance Claim HQ, we deal with homeowners insurance claims that could involve temporary living arrangements and additional living expenses. Contact us to review your case and represent you.
What Are Additional Living Expenses?
Sometimes strong winds, fires and even a leaking roof can compromise the structure of your house and make it inhospitable. Additional living expenses is a component in homeowners insurance that caters to your lodging costs when you are temporarily displaced from your home to somewhere else.
It typically covers the difference between your regular expenses and your lodging expenses. However, not all homeowners insurance covers additional living expenses, and you need to review your policy carefully to understand what it includes.
Ensure you check with your insurer when in doubt to ensure you don’t accrue bills the insurance will not cover. Some of the extra expenses that are typically covered include:
- Pet boarding
- Hotel and motel bills
- Laundry service
- Furniture rental
- New clothing
- Any extra mileage from your new home to your work and your kid’s school
When moving to a new place, you might have some extra expenses that must be handled. They might add up to a significant amount, and you don’t have to cater for them if your insurance policy can take care of them. This includes sewer fees, IT fees and fees of setting up Wi-Fi in your new space; this is vital to consider if you work remotely because your home is also your office.
What Are the Limits to Additional Living Expenses?
Not all homeowner insurance policies are the same, and the amount of additional living expenses that will be covered will depend on the exact wording of your policy.
To avoid being caught unaware, consider consulting an insurance claims lawyer. They understand the legal jargon of the policy more than you and will come in handy when the insurance company tries to get out of compensating you.
Most insurance firms have a monetary cap on additional living expenses and may not compensate you after that period. For example, if strong winds or a storm destroy your house, and the constructors tell you that it will only take 12 months to repair, the insurance company will cover your additional expenses for the 12 months, and it cannot exceed that.
Additionally, ALE is usually set to cover 20% of your dwelling coverage. If your house is a three-bedroom house, you cannot get the insurance to pay for a three-bedroom house with a swimming pool. If you feel like the cover is insufficient to maintain your living standard, you should seek a legal opinion. Note that only a few insurers provide unlimited ALE.
What Doesn’t Additional Living Expense Insurance Cover?
Additional living expenses are only offered when your house undergoes damage covered by your homeowners insurance, like fire, smoke, wind, and water damage from a burst pipe or leaking roof.
Get Legal Help With Your Additional Living Expenses Claim
If you are considering filing an additional living expenses claim, you need to understand your policy’s details and the legal process involved. An experienced insurance lawyer can help you navigate this process and prevent your insurer from shortchanging you.
FAQs About ALE Payments
How can you calculate your expected ALE payment?
Your ALE claim is usually 20% of your living expenses, and only covers costs you wouldn’t have had if you had continued living in your house. You can also calculate it as (current living expenses) – (living expenses before your covered loss).
How do you receive your ALE payment?
Most insurance companies reimburse you by check for your expenses as you incur them, while some will give you a lump sum when you file your claim. If you need more funds, your company might give you an advanced payment.