Understanding Additional Living Expenses Insurance

What does additional living expenses coverage do for you?hotel room

Homeowners insurance is made up of four main coverages: dwelling, personal property, personal liability, and additional living expenses.  While most policyholders understand how these first three coverages work, they may not even know that additional living expenses coverage exists.  Here is what homeowners need to know about this important type of insurance.

  • Understanding Additional Living Expenses Insurance

Additional living expenses coverage is coverage that you can use to pay for your living expenses in the event that your home is temporarily uninhabitable.  For instance, imagine that your home is severely damaged in a fire.  While the dwelling portion of your home insurance will cover the cost of repairing your home, it may not be safe for you and your family to stay in the home while it is undergoing repairs.  Fortunately, the additional living expenses portion of your home policy will cover the cost of living away from your home.  For instance, it can help you cover the cost of staying in a hotel, renting a temporary residence, eating at restaurants, storing your furniture, and so on.

  • Additional Living Expenses Coverage Limits

Like all forms of insurance, your additional living expenses coverage is subject to limits.  Most policies come with a coverage limit that is a percentage of your dwelling coverage.  For instance, standard policies will offer additional living expenses coverage up to 20% of your dwelling coverage.  So, if you have $300,000 of dwelling coverage, then you would have $60,000 of additional living expenses coverage.  Insurers also usually cap your coverage at a certain time limit.  For instance, your insurer might only offer additional living expenses coverage for 12 months.

This is what homeowners need to know about their additional living expenses insurance.  Do you have more questions about your homeowners insurance?  If so, then contact the experts at ISU-Wissink Insurance.  Our dedicated team is eager to assist you with all your coverage needs today.