What Do I Do Now?

What Do I Do Now?

How Your Homeowners Insurance Helps You Find a Home Away From Home When You Can't Live In Yours

No one wants to seriously think about the possibility that their home could be

It costs almost nothing to make sure you're never left asking, "What do I do now?"

damaged badly enough that they would have to relocate while repairs are being made. After all, there's no place like home! Unfortunately, that's the uncomfortable position a huge percentage of homeowners find themselves in when they file a homeowners insurance claim. If the building has been damaged badly enough that they've contacted their homeowners insurance company in the first place the building is often too banged up for them to continue to live there. They're going to have to find somewhere else to stay while the building crew is hard at work.

The question is, where? Do you drop in on your Great Aunt Sally or shamelessly impose on your brother and his family (dogs and all) for the weeks or months it can take to get your home back to a state where you can safely sleep in it every night without having to worry about taking your life in your own hands every time the wind blows? If you have family nearby you get along with that might be an ideal solution for the short term, but unless you're on great terms neither one of you wants that to be a permanent situation.

Homes severely damaged as a result of fire, floods, storms and any other disaster that Mother Nature happens to dream up can in some cases take a year or more to be rebuilt by an experienced construction crew, longer if you live in western New York (or someplace like it) where it snows nine months out of the year. Since living in a tent in your backyard until repairs are finished probably isn't a very appealing option, what are you going to do in the meantime?

The obvious answer is to pick up a hotel room for a few months. Just think-months of rooms you don't have to clean and dinners you don't have to cook. Let's hear it for housekeeping and restaurants! If repairs are going to drag on interminably you might even want to look into the possibility of renting an apartment-short term, of course, possibly even on a month by month basis. But here's the catch. While you're renting or living out of a suitcase, your monthly mortgage payments are still due.

Do you have enough expendable income to be able to afford both payments every month? Probably not. That's why your homeowners insurance is picking up the tab.

Yes, you heard right. Additional living expenses are a standard part of most homeowners insurance policies, and they're there to help you pick up the cost of having to find a new home away from home while your home is being repaired. Hey, who says that insurance companies are nothing but blood sucking leaches? Not only are they going to pick up the bill for your repairs, they're also making sure you've got food on your plate and a roof over your head in the meantime. (Maybe it's time to add your insurance agent to your Christmas card list…)

The additional living expenses included in your homeowners insurance policy include:

∞ Hotel bills.

∞ Restaurant meals.

∞ The cost of renting another property short term, including deposits and renters insurance.

∞ The cost of renting furniture and electronics similar to those you had in the property that was damaged.

∞ Reimbursement for rent, if you were renting out part of your home and you're losing rent payments while repairs are being made.

Unfortunately, additional living expenses don't mean you're going to have the chance to hop from suburbia to the Ritz for a couple of months (unless your homeowners insurance provider happens to have a fairy godmother on staff, at which point all bets are off). Additional living expenses are meant to cover the difference between the cost of renting and your regular cost of living, which means you're still going to be responsible for many of your daily expenditures. And most companies have limits as to how much they're going to pay and how long they're willing to pay it, so you're going to have to budget pretty carefully.

All things considered, however, the additional living expenses included in your homeowners insurance can be a lifesaver. When your home's been damaged that badly you've got enough on your plate to worry about without having to worry about the drop in your quality of living that's going to come from having to move into a cardboard box or your parents' basement. Your homeowners insurance policy is making sure you never have to.

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