Additional Living Expense Insurance
Additional Living Expense Insurance is a type of coverage present on several types of Homeowner’s Insurance that reimburses additional costs caused because of the insured’s claim.
Let’s put it in a scenario so it’s easier to visualize:
Homeowner Sarah has her house trashed because of an Act of God: a hurricane has ravaged her city and the strong winds made a tree fall on her roof and the water damaged her whole kitchen and appliances. She first stayed at a hotel, while the insurance company was figuring out the extent of the damage. When they found out, one week later, that it would take 6 months to rebuild the house, she had to rent a house for her family to go to.
Both the cost of staying at a hotel and the rent of the temporary house are covered by the Additional Living Expense Insurance.
Like the name says, any additional living expense caused by whatever peril that damaged your house is covered by this type of insurance. For instance: if, because of it all, Sarah – who used to take her kids to school walking and spent zero dollars doing that – now needs to drive them there, the gas money is all covered by the additional living expense insurance. If she now spends $100 a month with it, on top of the $50 she used to spend, then she gets $100 from the company and still pays for that $50.
Additional Living Expenses insurance coverage usually provides from 10-20% of the structural coverage of the home and is basically a way of maintaining normalcy in an otherwise chaotic moment. It makes us confident that, should anything happen, it will all be fine and we won’t have to spend more than we used to.
Real Estate tips:
Use The OFFICIAL Real Estate Agent Directory® to connect with a real estate agent capable of guiding you through all types of Home Insurance policies!
Popular Insurance Terms
Same as term Direct Response Marketing: method of selling insurance directly to insureds through a companies own employees, through the mail, or at airport booths. The company uses this ...
Group arrangement in which a network of attorneys provides legal services to the participants in the plan with the attorney fees being reimbursed by the provider. The attorneys who are ...
Period allowed an insured to notify an insurer of loss. Many policies require immediate written notice, or notice as soon as practicable. Different types of policies have their own time ...
Insurance company that restricts its underwriting of risks to one state. ...
Commercial liability insurance form providing coverage for an insured business in the event of a pollution liability suit. The insurance provides claims made basis liability coverage. ...
Liability arising out of the operation of a motel or hotel as it pertains to the physical safety of guests and their property. ...
Section of the insurance company that administers claims for the losses incurred by the insured. ...
Prior to 1988, right to withdraw retirement assets before age 59 1/2 without having to pay a 10% penalty under the following circumstances: medical expenses are incurred. the plan ...
Required minimum amounts of coverage that an insurance company will underwrite. For example, for auto liability coverage the minimum that many companies will write is $25,000. Most ...
Have a question or comment?
We're here to help.