Losing your home may be unimaginable, but there could be something worse—losing your home with no insurance payment to cover your post-disaster living arrangements. Imagine staying in a shelter rather than a hotel while trying to rebuild your life.
Fortunately, this contingency is usually covered by your homeowners policy, in an aspect of coverage called “loss of use.” This refers to the needs you have besides the cost of replacing your home in the aftermath of a disaster. Rebuilding or buying a new home can take a year or longer, and it’s important that you and your family be secure during that time.
What kind of event will trigger this coverage? It is direct damage to your home that makes it unfit to live in, such as severe damage from a fire or tornado. No coverage applies if the event is already excluded by your policy (say, earthquake or flood), but might apply in certain cases if authorities require you to evacuate your home.
Not only thousands of dollars in expenses but your peace of mind are at stake. Being paid for additional living expenses can help maintain your standard of living. If you lose a three-bedroom home, you should be covered for the cost of three substitute bedrooms, first in a motel and later in a rental home.
Additional living expense claims are often separated into the costs of the first month and a longer rental period while a new home is being prepared. Such expenses could include a motel stay, rental home, increased meal costs or pet boarding while you are in a motel, storage facilities, transportation, laundry and relocation costs.
The purpose of insurance coverage is to lighten your load: mostly in terms of financial risk, but sometimes with the emotional benefit of your quality of life. “Loss of use” coverage is a perfect example of that.
A graduate of Bryant & Stratton Business College with a degree in accounting, Michele Stephens has 11 years of experience in personal and commercial lines and insurance underwriting. In business since 1975, Jones & Wenner is a large, diversified independent insurance agency in Fairlawn. Call 330-867-4434 or visit www.jones-wenner.com.