Loss of Use

What did all those people in north Nashville and Wilson Co do after the tornado destroyed their homes?  Where did they go?  Where did they sleep that first night?

A standard part of every homeowners policy is the “Loss of Use” or “Additional Living Expenses” coverage, also known as Coverage D on your policy.  When your home is extensively damaged by a named peril in your insurance policy, like a windstorm or fire, and you can no longer live there, Coverage D kicks in.  This protection will immediately put you and your family in a hotel and provide money for food, clothing, and other necessities.  The insurance company will continue to provide this temporary housing and the necessary financial resources until you and they are able to find more appropriate housing until your home is repaired or rebuilt.

As you can imagine, there will be many other expenses that occur in a situation like this, and your insurance company will meet these expenses too, as the name “Additional Living Expenses” implies. An example is additional fuel costs if you have to drive more than you have in the past.

The limits of “Loss of Use” coverage are commonly a percentage of the amount your home is insured for: 20-30% is regularly used.  Some policies will cover these additional expenses on what is called an “ALS” or “Actual Loss Sustained” basis, which means there is no limit.  The insurance company will reimburse you for whatever you have to spend in order to maintain your lifestyle as best as possible.

What happened to the people whose home was destroyed by the tornado and did not have adequate insurance protection?  Questions?  Please call me, Jim McKee at 615-585-3684.