Additional living expense insurance is a type of coverage included in homeowner's, condominium owner's, or renter's insurance policies. It helps cover the extra costs of living that arise when a policyholder is temporarily unable to stay in their home due to a covered event, such as a fire or severe storm. This coverage typically amounts to about 10 to 20 percent of the dwelling insurance amount.
This term is primarily used in the context of property insurance law. It is relevant in civil legal matters, particularly those involving insurance claims. Policyholders may need to file claims to access this coverage after experiencing a loss that displaces them from their residence. Users can manage their claims and related documentation using legal templates available from US Legal Forms.
Here are a couple of examples of abatement:
Example 1: A family experiences a fire that damages their home. They are forced to stay in a hotel for two months while repairs are made. Their additional living expense insurance covers the hotel costs and meals during this period.
Example 2: A renter's apartment is severely damaged by a storm. They must relocate temporarily to a rental unit. The insurance covers the difference in rent and other living expenses incurred during the displacement. (hypothetical example)
| State | Coverage Limits | Common Exclusions |
|---|---|---|
| California | Up to 20 percent of dwelling coverage | Earthquake damage |
| Florida | Up to 30 percent of dwelling coverage | Flood damage |
| Texas | Up to 15 percent of dwelling coverage | Negligence-related damages |
This is not a complete list. State laws vary, and users should consult local rules for specific guidance.
| Term | Description | Difference |
|---|---|---|
| Loss of Use Insurance | Covers costs when a property is uninhabitable. | Often broader, may include loss of rental income. |
| Dwelling Coverage | Insurance for the physical structure of a home. | Focuses on property damage, not living expenses. |
If you find yourself displaced due to a covered event, follow these steps:
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It covers extra costs incurred when you are temporarily displaced from your home due to a covered event.