It is essential to understand the different types of coverage available to protect your property in the event of damage or loss. One such coverage is Loss of Use coverage, an often overlooked but crucial component of property insurance.
Loss of Use coverage, is also known as Additional Living Expenses (ALE) coverage. It is designed to cover the cost of living expenses if your property becomes uninhabitable due to damage or loss. This can include things like temporary housing, food, and other expenses related to relocating while your property is being repaired or rebuilt.
The purpose of this blog is to explain what Loss of Use coverage is, how it works, and how it can help property owners in the event of a property damage claim. Whether you’re a first-time property owner or have been a property owner for years, understanding Loss of Use coverage is crucial to protecting yourself and your property.
In the event of a hurricane, natural disaster, or other covered events, Loss of Use coverage can provide peace of mind knowing that your living expenses will be covered while your property is being repaired or rebuilt. Without this coverage, property owners may be left to bear the burden of these costs on their own.
What is Loss of Use Coverage and how does it work?
Loss of Use coverage is also known as Additional Living Expenses (ALE) coverage. It is a type of insurance that covers the additional expenses incurred when a person is unable to live in their property due to a covered loss. This type of coverage is typically included in property insurance policies and covers expenses such as temporary housing, meals, and other necessary living expenses.
It is important to understand the scope of ALE coverage so that you are not caught off guard.
Some of the costs that may be covered under ALE include:
- Laundry expenses at a laundromat if you don’t have access to a washer and dryer.
- Credit check fees charged by the management of your temporary rental property.
- Furniture rental for an unfurnished apartment or condo.
- Rental costs for items you are used to having in your property.
- Storage fees for large items that would be subject to damage if left at property during repairs.
- Meals incurred while driving back and forth for rebuild-related business.
- Insurance for contents in a temporary rental house.
- Moving or displacement costs.
- Reconnection fees for setting up services at the rebuilt property.
- Pet boarding.
- Sewer fees.
- Internet, utility, and cable connection setup fees.
- Mailing expenses and photocopies related to your claim.
- Mileage to and from a rental property and to and from all locations visited for rebuild-related business.
It is worth noting that while ALE can help cover these costs, they will be evaluated against your normal living expenses. The goal of ALE is to pay the difference between your normal expenses and the expenses incurred during displacement.
It is important to note that ALE does not cover damage to your property or belongings. This is where the property owner’s insurance comes in. The dwelling coverage in a property owner’s insurance policy can help cover repairs caused by a covered peril, like a hurricane. Personal property coverage can help cover the cost of replacing or repairing belongings that were damaged.
It is crucial to regularly review your property owner’s policy to ensure that you have the right amount of coverage. Even basic property improvements can add value, which may require you to increase your coverage.
What are examples in which I can use Loss of Use coverage?
This type of coverage can help you in a number of ways, including covering additional living expenses such as temporary housing and food expenses.
For example, if your property is damaged by a hurricane and you are unable to live in it while repairs are being made, Loss of Use coverage can help. It can cover the cost of a temporary rental property or hotel stay. Additionally, it can also cover the cost of meals and other expenses incurred while you are temporarily displaced from your property. This can help alleviate the financial burden that often comes with unexpected property damage and help you get back to your normal routine as quickly as possible.
Some examples of what may make a property uninhabitable include:
- Flooding, which can cause severe structural damage and make the property unsafe to live in.
- Unsafe electrical wiring, which can make a property uninhabitable until repairs are made.
- Tree damage, which can make a property uninhabitable if the damage is severe enough.
- Power outages, which can make it impossible to maintain a safe temperature, cook food, and access running water.
- Roof damage, which can make the property unsafe to live in and also cause water damage to the interior.
- Mold growth, which can make a property uninhabitable due to the health risks associated with exposure.
- Gas leaks, which can be dangerous and make a property uninhabitable.
Loss of Use coverage can also help property owners with the cost of storing their belongings while repairs are being made. This can be especially beneficial for those with valuable collections or items that are difficult to replace. By covering these expenses, Loss of Use coverage can help people avoid additional financial stress.
Hiring Your Large Loss Adjuster to Help with Your Claim
Your Large Loss Adjuster is the go-to company for all your property damage claims and Loss of Use coverage needs.
Our team of experienced adjusters are dedicated to providing you with the best possible outcome for your claim. We understand that dealing with property damage can be stressful and overwhelming. So, we work quickly and efficiently to get you the help you need. Whether you need temporary housing or help navigating the claims process, Your Large Loss Adjuster is here to assist you every step of the way.
Don’t let property damage ruin your peace of mind, trust Your Large Loss Adjuster to handle it all. Contact us today to learn more!