Using Additional Living Expense Coverage to Your Benefit
Navigating the aftermath of a disaster can be overwhelming, especially when it forces you out of your home. This is where Additional Living Expense (ALE) coverage becomes a lifeline. It safeguards you from the financial strain of temporary housing, rental costs, and other out-of-pocket expenses that can quickly accumulate.
ALE is part of a standard personal property insurance policy, playing a crucial role in maintaining your standard of living while your home is being repaired or rebuilt.
Understanding Additional Living Expense Coverage
ALE coverage is a critical component of homeowners’, condo, and tenant insurance in Canada. It’s designed to protect you financially when your home becomes uninhabitable due to an insured disaster.
This coverage helps maintain your standard of living by covering necessary costs incurred while your primary residence is being repaired or rebuilt.
Key Features and Covered Expenses
ALE typically includes reimbursement for rental costs, hotel bills, and additional food expenses. The goal is to help you maintain the same standard of living you had before the loss occurred.
*Important: It’s crucial to know that this coverage only kicks in if the damage is caused by a peril included in your policy.
Example of When You Can Use Additional Living Expense
Here are some common expenses your insurance company may cover under ALE:
Temporary Accommodation
If you need to rent a new home or stay in a hotel while your property is being repaired, the additional accommodation cost may be covered..
Meals:
If you cannot cook at home and need to eat out, your policy may cover the additional meal expenses above your normal spending.
Moving Expense:
Costs for hiring a moving company to transport your belongings to a temporary residence may be reimbursed.
Storage:
Renting a storage unit to secure your belongings while your home is being repaired may be reimbursed..
Pet Boarding:
If you need to board your pets while you are temporarily displaced, the cost of their care may be covered.
Important Reminder: Coverage limits vary by insurer; please review your policy details carefully
Common Scenarios Where ALE is Beneficial
ALE coverage provides peace of mind across several types of home disasters:
Natural Disasters
When events like hurricanes or wildfires strike, your home may become uninhabitable, necessitating temporary relocation. ALE ensures expenses like hotel bills and temporary rentals are covered, helping you maintain your standard of living while your property is restored.
Fire and Water Damage
Unexpected incidents of fire and significant water damage can render a home unlivable. During the restoration period, ALE covers the costs of alternative accommodations and other associated expenses.
Mandatory Evacuation
In situations where a mandatory evacuation is declared due to an imminent threat to safety, ALE becomes indispensable. It supports you by covering the costs of temporary housing and other necessary expenses during the evacuation period, relieving the stress of unforeseen displacements.
How to File an ALE Claim
When you need to file a claim for Additional Living Expense coverage, it’s important to proceed with clarity and organization.
Necessary Documentation
Start by gathering all necessary documentation, including a detailed record of all incurred expenses. This typically includes hotel bills, rental payments, and additional meal costs beyond your usual expenses.
Important Reminder: Ensure you keep all receipts and bills, as these will be crucial in substantiating your claim.
Steps to Submit a Claim
Here are the essential steps for submitting your claim:
Step 1: Contact Your Insurance Provider
As soon as possible, inform your insurance provider about the need to claim your ALE coverage. Prompt communication is key.
Step 2: Review Your Policy
While your advisor cannot confirm or deny coverage, they can help you review your policy to understand the extent of coverage that may be available for temporary housing and living expenses.
Step 3: Submit Required Documentation
Provide your insurer with all collected documentation of the additional expenses incurred. The clearer and more organized your submission, the smoother the process
Step 4: Follow Up Regularly
After submitting your claim, keep in touch with your insurance adjuster to track the progress of your claim. Regular follow-ups will ensure your claim is processed efficiently.
Frequently Asked Questions
What is the purpose of ALE, and how long does the coverage last?
The purpose of Additional Living Expense (ALE) coverage is to reimburse you for expenses above your normal cost of living when you cannot inhabit your home due to an insured loss. Coverage typically lasts until your home is repaired or until you reach the policy’s wording limitations, whichever comes first.
Does ALE cover all my expenses while I’m out of my home?
No, ALE does not cover all expenses. It only covers the increase in costs. For example, your normal grocery bill would not be covered, but the extra cost of eating out at a restaurant because you don’t have a kitchen would be. Also, it only covers damage caused by a peril listed in your policy, and it does not cover your mortgage payments or regular utility bills.
If I am forced to evacuate by a civil authority, is that covered?
Yes. If a civil authority (like a municipal or provincial government) orders a mandatory evacuation (caused by an insured peril) that makes your property uninhabitable or restricts access to your area, ALE coverage typically applies for a set period.
Disclaimer: The information provided in this article is intended as a general guide. Please consult your specific insurance policy for precise coverage details, including conditions, definitions, and exclusions that apply to your individual insurance.
Stay Connected With Harvard Western
hanks for reading! I hope you found this month’s topic on Additional Living Expense coverage helpful. Here are some more ways to access insurance information and tips:
1.
Visit our Blog/article page each month, where we publish various insurance articles and share information on specific industry products.
2.
Learn more about or get a quote for Tenant Insurance, and visit our product page for comprehensive information.
3.
Follow us on LinkedIn to stay up to date on the latest insurance articles and company updates.
Last updated:
Posted in Home & Tenant on January 28, 2024 by Harvard Western Insurance
Share: Tweet
