Understanding Your Insurance Coverage for Additional Living Expenses
If you’ve only had time to skim through your home insurance policy, you may have missed the section explaining coverage for something called Additional Living Expenses (ALE).
This often overlooked coverage reimburses you for the cost to temporarily or permanently relocate (and maintain a comparable standard of living) following a covered incident that makes your home uninhabitable in the short-term or long-term.
For example, if you had to move into a hotel while your home was being repaired for serious damage following a fire, ALE would cover any necessary increase in your living expenses. This might include moving expenses or the cost to eat at a restaurant if you were unable to cook your own food. Keep in mind that ALE only covers the increase in your normal living expenses so your policy would reimburse you for the difference between your normal cost for food and the cost for eating at a restaurant.
Here are some of other common additional living expenses:
- Rental home
- Mileage and utilities
- Pet boarding
It is important to track all of your expenses and keep receipts while you are temporarily displaced. Also, check with your claims adjuster to make sure an expense is covered before you come out of pocket.
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