While a fire, hurricane or other serious peril can cause property owners to experience varied forms of financial loss, one of the most immediate hardships following a disaster involves displacement from the family home. If your home is not habitable because of damage caused by a covered peril, you will be forced to relocate for a period that can easily last for months. During this interim period, the costs associated with hotel bills, dining out, grocery bills, additional travel expenses and similar expenses can easily be tens of thousands of dollars. The process of obtaining funds from your insurer to pay these expenses will typically be your most urgent and immediate need if the damage to your home forces you to relocate on a temporary basis. Homeowners policies can provide much needed financial relief in the form of “Additional Living Expenses” (ALE). This is a form of coverage that you might not even know is provided by your homeowners policy. Our Miami-Dade insurance claims law firm has provided some answers to common questions about ALE coverage.
What constitutes Additional Living Expenses coverage under a typical homeowner policy?
Homeowners can be forced from their home because of a fire, hurricane, earthquake or other natural disasters that make the home temporarily uninhabitable. Many homeowners have policies that cover essentials of daily life, such as food and housing at least to some extent during the period their home is not habitable.
What expenses will ALE coverage provide during the period that I am displaced from my home?
In the broadest terms, ALE coverage pays for the difference between pre-loss and post-loss living expenses like housing and food. By way of example, you might have a mortgage payment of $2,000 per month, utilities of $500 per month and monthly groceries of $800 per month. If you rent an apartment or check into a motel, your monthly rent for the motel might be $1,500. Further, you might find that you have reduced utility costs of only $200 per month. This portion of your monthly ALE expenses would be $1,300 because this is the actual net out-of-pocket expenses that you would incur for lodging during your displacement from you home after deducting the utility savings. Because you are not able to cook at home, you might also incur increased meal expenses. If your meals for the month were $1,100 due to the cost of dining out, you could seek $300 for the net increase in your monthly expenses for food. If your relocation means that you have a longer commute to work, school and other destinations, the additional cost of transportation also can be covered by ALE coverage.
How much money will my ALE coverage provide if I am forced from my home by a covered peril?
The precise monetary amount that your insurance will pay for these unanticipated living expenses will vary depending on the precise terms of your policy. However, your policy will typically contain some type of cap, so you should carefully refer to your policy to determine the amount of ALE expenses included in your coverage. Many policies allow up to twenty percent of the amount of coverage on your home. If your policy provides $750,000 in coverage for damage to your dwelling, for example, your ALE limit would be $150,000. Many policies also delineate a time period within which certain costs will be covered, so you will also want to review your policy for these types of restrictions.
If your home has been damaged and your insurance company is giving you the run around, my law firm might be able to help. An experienced Miami insurance claims attorney can help you counter such denials. My law firm represents policyholders in claims disputes in Miami and throughout Florida. The Law Firm of J.P. Gonzalez-Sirgo, P.A. offers free consultations and case evaluations. No Recovery, No Lawyer Fees. Call 305-461-1095 or Toll Free 1-866-71-CLAIM.