Glossary
Additional living expenses coverage, defined
The measure of what a home policy pays while a household is displaced by a covered claim: the difference between its normal monthly cost and the higher cost of keeping a comparable standard elsewhere.
In practice
It is the household's part of the loss of use section. Comparable is the standard: a family in a three-bedroom house is housed in something similar, not a studio and not a resort. Covered items commonly include temporary rent, hotel stays while a rental is found, moving and storage, extra commuting, pet boarding and the increase in food costs. Items that continue anyway, such as the mortgage, are not paid because they are not extra. Payment stops when the home is repaired or the household settles elsewhere permanently, or when the time limit or dollar limit is reached, whichever comes first. Ask the adjuster for an advance early; long claims run for many months.
A worked example
Suppose a family's house is unlivable after a monsoon roof collapse. Their normal grocery spend is $800 a month; in a hotel without a kitchen they spend $1,600. The policy pays the extra $800 a month for food, plus the hotel, until a rental is arranged. Hypothetical.
Applies to: Home InsuranceMobile & Manufactured Home Insurance