Understanding Your Loss of Use Claim

If your home is uninhabitable and you have to temporarily relocate after a covered loss, your homeowners’ policy may reimburse you for any resulting increases in your normal day-to-day living expenses.

If your policy provides Loss of Use coverage, your policy will reimburse you for Additional Living Expenses (ALE) for the period of time reasonably required to make your home habitable again. This time period is commonly referred to as the “period of restoration.”

ALE only covers the additional, reasonable costs above what you or your family would ordinarily spend. It does not include excessive expenses beyond the normal standard of living maintained before the loss.

Calculating your ALE payment

Here is an example of how an ALE payment could be calculated when a covered customer has increased living expenses due to temporary living arrangements and eating out at restaurants. In this circumstance, rental and dining out expenses would increase, but grocery expenses would decrease. In this instance, here is how the ALE may be calculated.

This case study is for illustrative purposes only. Your individual case may vary.

Submitting an ALE Reimbursement Request

Your ALE coverage applies only to incurred expenses. This means that you must pay for the items or services before your insurance company can reimburse you. ALE should be pre-approved by your  Claim professional, except in the case of an emergency or extraordinary circumstance.

What you need to do:

Talk to your Claim professional as soon as possible about your needs and develop a schedule for submitting your receipts.

Save your receipts in chronological order. This will allow you and your Claim professional to easily reference them.

Include a description of the expense on each receipt.

Once you have submitted your receipts and bills, your Claim professional will determine the ALE owed to you and issue payment.

* Many policies have a limit for ALE. Please work with your Claim professional and your contractor to determine the amount of time reasonably required to make your home habitable again; doing so will allow you to better manage your expenses.