Tenant Insurance: Additional Living Expenses Explained

Tenant Insurance: Additional Living Expenses Explained

Do you ever wonder what would happen if you couldn’t live in your home after a claim? Tenant insurance isn’t just coverage for your stuff and liability risks, it also includes Additional Living Expense coverage.

What is Additional Living Expense Coverage?

If your home becomes unlivable due to a loss covered by your policy (ie. Fire) your insurance company will help you maintain your current standard of living by compensating you for any additional expenses you incur. Basically, Additional Living Expense coverage helps to keep you from crashing on your friend’s couch while your home is being repaired.

What is covered?

The key word here is additional. This coverage is not intended to send you on a mini vacation to the Moose Jaw Spa for a week while your home is being fixed. Your insurance policy is designed to help you maintain the same standard of living that you had before the loss occurred. For example, if after a loss you have to rent an apartment across town and you need to hire a moving company, your insurance policy will compensate you for those additional moving expenses. Other expenses that might be covered can include additional rent, restaurant meals, kenneling for your pet, and storage fees.

What isn’t covered?

Like most insurance coverage, Additional Living Expense coverage won’t cover just anything. Like mentioned previously, this coverage here to help you maintain your standard of living, not improve it. Let’s say a pipe bursts in your apartment and now you need to find somewhere else to live, but instead of renting a 1 bedroom apartment similar to yours, you end up moving into a 3 bedroom unit on the top floor. Your extra rent expenses may not be reimbursed. It’s important that if you have a claim you get your expenses approved by an adjustor, don’t just assume you’ll be covered.

Every insurance company is different, so make sure to review with your broker how much Additional Living Expense coverage your policy includes. No one wants to think about their home being taken away, but if the worst does happen, having a policy in place can provide financial support when you need it most.