If your home is damaged by fire, water, or another type of insured loss, you may have to move into a hotel or rental home while repairs are being done. Extra living expenses and the costs of rental or hotel could be covered by "additional living expense" insurance if you have a policy which includes it. In this article, we will be going over some of the questions about additional living expense insurance that many policy holders may have.
How are the extra costs going to be paid?
Well, if you had the right home insurance, including "additional living expense" coverage, and the loss was caused by an "insured peril", you may just find these extra expenses will be paid by your insurance provider.
What does insured peril mean in relation to additional living expense insurance?
Comprehensive protection on the majority of home insurance policies will cover against losses such as water, fire, theft, windstorm, smoke, among other things, but of course there are certain things that are excluded, and some conditions apply. Floods and landslides for a couple of examples, are instances that are not insured perils.
When the damage that happens to your home makes it so that it can not be lived in, the insurance will pay your extra living costs, up to a the limit that the policy covers, as long as it is an insured peril.
So, "additional" expenses refer to what in particular?
As the damages are being fixed, you still need to pay all of your regular expenses that you have. These might include:
Mortgage payments;Insurance premiums;Transportation costs; and, Groceries.
"Additional" expenses are ones you wouldn't normally have had, such as:
The cost of the hotel stay, or rent at a temporary home. Higher expenses for food. If there were no kitchen facilities in the hotel, you may have had to eat in a restaurant all week. What the insurance provider will pay is actually not the entire bill at the restaurant, but only the difference between what the policy holder would have paid for groceries, and the restaurant bill.
Higher expenses for transportation. If you need to take public transportation or drive when you or your family regularly walks to school or work, this will cost you more.
What happens for those who have rental units in their home?
When the entire home was damaged or possibly destroyed, the rents from the tenants that would be in the suites will not be coming in each month as they had before, until the repairs are completed. As mentioned above, you're still responsible to pay for your mortgage, but now you're missing that rent money you may have been counting on. A landlord will have protection from this situation if they choose to purchase rental income insurance from their insurance company.
What happens if there was a home business that was damaged?
Sometimes a home owner will have to rent office or studio space in order to keep the home business going during the home repairs. When the business must be suspended, is the lost income covered? Business costs such as these are not part of the additional living expenses insurance. Be sure to talk to your insurance agent about obtaining coverage. A commercial insurance policy might be what you require.
When a tragedy like this occurs, it's a very tough time for the homeowner. Much of the stress can be removed if the homeowner has the proper kind of home insurance coverage.
How are the extra costs going to be paid?
Well, if you had the right home insurance, including "additional living expense" coverage, and the loss was caused by an "insured peril", you may just find these extra expenses will be paid by your insurance provider.
What does insured peril mean in relation to additional living expense insurance?
Comprehensive protection on the majority of home insurance policies will cover against losses such as water, fire, theft, windstorm, smoke, among other things, but of course there are certain things that are excluded, and some conditions apply. Floods and landslides for a couple of examples, are instances that are not insured perils.
When the damage that happens to your home makes it so that it can not be lived in, the insurance will pay your extra living costs, up to a the limit that the policy covers, as long as it is an insured peril.
So, "additional" expenses refer to what in particular?
As the damages are being fixed, you still need to pay all of your regular expenses that you have. These might include:
Mortgage payments;Insurance premiums;Transportation costs; and, Groceries.
"Additional" expenses are ones you wouldn't normally have had, such as:
The cost of the hotel stay, or rent at a temporary home. Higher expenses for food. If there were no kitchen facilities in the hotel, you may have had to eat in a restaurant all week. What the insurance provider will pay is actually not the entire bill at the restaurant, but only the difference between what the policy holder would have paid for groceries, and the restaurant bill.
Higher expenses for transportation. If you need to take public transportation or drive when you or your family regularly walks to school or work, this will cost you more.
What happens for those who have rental units in their home?
When the entire home was damaged or possibly destroyed, the rents from the tenants that would be in the suites will not be coming in each month as they had before, until the repairs are completed. As mentioned above, you're still responsible to pay for your mortgage, but now you're missing that rent money you may have been counting on. A landlord will have protection from this situation if they choose to purchase rental income insurance from their insurance company.
What happens if there was a home business that was damaged?
Sometimes a home owner will have to rent office or studio space in order to keep the home business going during the home repairs. When the business must be suspended, is the lost income covered? Business costs such as these are not part of the additional living expenses insurance. Be sure to talk to your insurance agent about obtaining coverage. A commercial insurance policy might be what you require.
When a tragedy like this occurs, it's a very tough time for the homeowner. Much of the stress can be removed if the homeowner has the proper kind of home insurance coverage.
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