Does insurance cover other living arrangements while the roof or structural part of home is being repaired?


If your homeowners insurance has a loss of use cover, then yes, the insurance will cover the cost of alternative living arrangements while the roof or a substantial part of the house is being rebuilt or repaired.

The insurance will pay:

  • The cost of staying at a hotel (if the repairs will only take days) or the cost of renting an alternative home for the duration of the repairs (if the repairs will take longer)
  • Additional living expenses that you will need in order to maintain your current standard of living
  • Additional costs may include the security and utility deposits, lost rent (if you are currently renting a portion of the house), and rentals for appliances and furniture for the new apartment

This depends on the limits set in the homeowners insurance policy.

The additional living expenses are for things such as:

  • Purchasing a decent enough wardrobe to replace the wardrobe you have lost because of the fire
  • Payments for meals in a restaurant due to the fact that you are unable to cook while you are in a hotel
  • Payment to replace a computer if you need your computer to live

Please remember, however, that these are for additional living expenses and will thus not pay for existing expenses you have. For instance, if your weekly food budget is at $200 and you had to spend $500 for payments to the restaurant, the insurance will only pay the additional $300.

Also, the insurance company will deduct from the payments any expenses that will stop due to the fact that you're no longer living in the house. For instance, the insurance company will deduct utility expenses.

Loss of use coverage will only kick in if the house is unlivable. For some insurance companies, this is defined as damage to at least two bathrooms of a two-bedroom house. Also, the insurance will pay if a civil authority bans you from using your house due to safety purposes.

To determine how much rental cost can be reimbursable to you, the insurance company will appraise your house's fair rental value. This is how much rent your house will get if you rented it out.

It is also good if you maintain records of your monthly bills from credit cards and utilities, as well as monthly reports from banks.

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