You’re facing displacement from your Georgia apartment because of fire, internal flooding, or other calamity that leaves your living space uninhabitable. Can you afford a hotel or motel stay or an Airbnb rental for weeks or months until your unit can be restored?
Fortunately, your renters insurance can come to the rescue. If you have temporary housing coverage, you’ll be reimbursed for your short-term rental costs, up to your policy limits. Here’s more information from your friends at Southern Harvest.
What Is Loss of Use (Also Known as Temporary Housing) Coverage?
How long will you be welcome to camp out at your friends’ or family’s homes? Can you go basically homeless for long when you have a family of your own? What would you do if you were without housing because your rented unit needed extensive repairs after a catastrophe?
These are some of the questions you won’t have to answer if you have renters insurance. During disasters, your Additional Living Expenses (ALE) coverage kicks in, significantly reducing your financial responsibility until you can return to your rental unit.
How Additional Living Expenses Coverage Works
It’s really quite simple. During times of covered crisis, your renters insurance policy will reimburse you for your living expenses above what you’d generally have to pay.
This includes the cost of your temporary housing above your regular rent, your above-normal meal expenses, and even such things as storage costs if you must keep your personal property off-site for a time, and boarding costs if your pet isn’t allowed in your temporary housing.
Your insurer will provide this coverage until your rented quarters are restored, up to your policy limits and starting after you pay your deductible.
Real-Life Examples of Temporary Housing Coverage in Action
Most disastrous situations that leave your rental space uninhabitable for days, weeks, or even much longer are covered by the ALE or temporary housing benefits on your renters insurance plan. This includes devastating damage by fire, smoke, internal flooding from a burst water pipe, vandalism, or from a harsh weather event such as a tornado or hurricane.
When you’re told that you must temporarily relocate from your unit so it can be restored, your policy will help with the various costs you might incur during that time of displacement.
Policy Limits and Common Exclusions
Policy limits on temporary housing are usually in the form of a maximum dollar amount and time limits. The maximum dollar amount might be a fixed amount or a percentage of your property damage max. For instance, if your temporary housing allowance is for 30% of your $40,000 in property coverage, you’d have up to $12,000 in benefits during your displacement.
Your policy also probably dictates a time limit for temporary housing, such as 12 or 24 months.
Not every cause for temporary housing is covered on your renters insurance policy. You won’t receive benefits if you’re voluntarily relocating rather than because your space is uninhabitable, or if you’ve been evicted. Your insurer might also reject coverage if you’re moving to luxury accommodations.
You also can’t file claims if your need for emergency housing is due to what’s called non-covered perils. This can include damage from earthquakes or exterior flooding. (If you live in a flood zone in Georgia, it’s highly recommended that you buy flood insurance in addition to, or as an add-on to, your renters insurance policy.)
Types of Expenses Routinely Covered
Consider what you’d have to pay out of pocket solely as a result of being displaced for a period of time from your rental as a result of a catastrophe. Your rental insurance policy will likely cover most, or all, of those expenses, minus your deductible and up to your policy limits.
As mentioned, this would essentially mean the rent of your temporary housing beyond what you’d typically pay for rent. Restaurant meals might also be covered if your temporary space doesn’t have a kitchen. And if you don’t have a washer and dryer as a result of the covered event, you can claim laundry services.
If you had to move furnishings and personal possessions into a self-storage unit while renovations were underway, you can file that charge as well.
Ask your renters insurance agent about all of these and other associated costs as a result of being displaced so you can take full advantage of the benefits owed to you. Also, check whether the temporary unit should have a comparable housing cost to your rental, and how it would affect you if you can only find a pricey unit.
Tips to Maximize Temporary Housing Benefits With Your Policy
Consider how to use your ALE or temporary housing benefits most strategically in your renters insurance policy.
How to Choose the Right ALE Coverage Limits
What would it cost you to obtain temporary housing for several months or even as long as a year, where you live in Georgia? You’d need to be in fairly close proximity to work and school, or wherever you must be regularly.
What are typical charges for comfortable housing temporarily? Do the math, then consult a trusted rental insurance agent. Let your agent crunch the numbers at various levels. Don’t set your ALE benefit too high or your premiums will balloon. But take on enough coverage to feel financially protected if you need the benefit. Find the sweet spot.
How to File a Claim and Get Reimbursed Smoothly
Make a digital paper trail. Photograph the damage and send it to your insurer. Pass along messages by your property owner, fire marshal, or other authorities attesting to the fact that the damage is severe and you need to relocate for an extended period.
At the same time, contact your insurer. This can involve phoning your agent directly, using the company’s claims hotline, or going through online resources. However you do it, do it as soon as you realize you must vacate your rental unit. Ask about the procedure to make claims.
Collect receipts from launderers, restaurants, housing sites, and any other source where you have to spend money above and beyond what you’d pay before the calamity. It’s essential to have proof if any of your claims are challenged.