Experiencing a disaster that destroys your home is a traumatic and challenging event. You might not be able to live in your home for a while, possibly months, while it is being restored or rebuilt if a fire destroys it or a tornado tears off the roof. The cost of living increases until you can go back home again.
Amidst the chaos and emotional turmoil, it’s essential to understand your rights and options regarding additional living expenses (ALE). ALE coverage is a significant component of most homeowners’ insurance policies, yet many people are unaware of its existence or how to effectively utilize it. In this article, we’ll discuss what you need to know about additional living expenses.
What is Additional Living Expenses (ALE) Coverage?
Additional Living Expenses, as the name suggests, cover the costs associated with living away from your home during the time it takes to repair or rebuild it after a disaster. This coverage typically includes:
- Temporary housing (i.e. hotel bills)
With ALE coverage, other essential costs that exceed your regular living expenses are usually reimbursed. It is important to keep detailed documentation during this time and also keep all receipts of living expenses during this time.
What Incidents Are Commonly Associated with ALE?
ALE coverage typically applies to various situations associated with accidents or natural disasters (incidents a homeowner is not directly at fault for). While it is commonly associated with fire damage, ALE can come into play when your home becomes uninhabitable due to other covered perils or circumstances. Here are some scenarios where ALE coverage may apply:
- Natural Disasters: ALE can be triggered by natural disasters such as hurricanes, tornadoes, earthquakes, or floods.
- Water Damage: Burst pipes, plumbing issues, or severe water damage can render your home uninhabitable. In such cases, ALE can assist with temporary accommodation costs while your residence undergoes necessary repairs.
- Storm Damage: Severe storms with high winds can cause substantial damage to your home that may require repair or complete relocation.
- Structural Damage: Your home experiences structural damage due to a covered peril, such as a collapsed roof or foundation issue.
- Mold Remediation: Extensive mold growth resulting from water damage or improper ventilation may require you to vacate your home for an extended period. ALE coverage can help with temporary living arrangements while professional mold remediation is underway.
- Eviction or Forced Relocation: In rare instances, if you are forced to vacate your home due to reasons beyond your control, such as government orders or safety concerns, ALE coverage may apply to help cover the costs of temporary housing until you find a permanent solution.
What is Covered by ALE?
It is hard to imagine what it is like to be displaced from your home or have it completely destroyed by something out of your control. Your additional living expense coverage will reimburse you for comparable hotel accommodations. You will also be compensated for your meals while staying at a hotel as long as they fit into your normal routine.
With that being said if you stay at a luxurious hotel or resort, your additional living expense coverage might not be paid out unless the amount is equal to or greater than your typical monthly spending.
Your personal belongings are also covered by additional living expense coverage. Usually, it covers storage for your furniture and other intact possessions. In most cases, you are also compensated for any clothing you might have lost as a result of a covered loss, like a fire or flood.
Some of the most common ALEs that are covered include:
- Hotel expenses
- Meals (can claim if don’t have access to a kitchen)
- Pet Boarding (if they can’t stay with you during this time)
- Storage of possessions
Steps To File a Claim for ALE
Review Your Insurance Policy:
After an incident occurs, it’s vital to carefully review your homeowners’ insurance policy to understand the specific details of your ALE coverage. Take note of the coverage limits, duration, and any specific requirements or exclusions that may apply. Knowing these details beforehand will help you stay organized and make informed decisions while filing your claim.
Contact Your Insurance Company:
As soon as it is safe to do so, contact your insurance company to report the fire (or other incidents) and initiate the claims process. Inform them about your need for temporary housing and inquire about the ALE coverage included in your policy. The insurance company will guide you through the necessary steps and provide instructions for documenting your additional living expenses.
Keep Detailed Records:
When it comes to ALE claims, documentation is key! Keep meticulous records of all your expenses related to temporary housing, meals, transportation, and other essential living costs. Save receipts, invoices, and bills as evidence. Maintaining a thorough record will help you maximize your reimbursement and avoid potential disputes with the insurance company.
Reasonable vs. Comparable Living Expenses:
Insurance companies typically cover the difference between your normal living expenses and the additional costs you incur due to the fire. However, it’s important to note that ALE coverage does not necessarily guarantee a one-to-one replacement of your pre-disaster lifestyle.
The insurance company will consider what is reasonable and necessary under the circumstances. It’s recommended to discuss any significant expenses from your usual living arrangements with your insurance adjuster to ensure they are eligible for reimbursement.
Timelines and Extensions:
ALE coverage has a specific duration stated in your insurance policy. Make sure you understand the time limits to find a suitable long-term housing solution or rebuild your home within the given timeframe. If you encounter delays or unexpected challenges, communicate with your insurance company to explore the possibility of an extension.
Seek Professional Advice:
Navigating the insurance claims process can be complex, especially during distress. Consider seeking professional advice from a public adjuster to ensure you receive the maximum benefits entitled to you under your policy.
At Fortitude Public Adjusters, we work on your behalf to help you prepare, file and adjust claims so you don’t have to stress out anymore over this situation. We are experts in understanding how insurance companies put a value on property damage and what loopholes they try to find in your coverage. We are here to help, give us a call today!