Loss of use, and where you stay after a covered loss

Loss of use coverage pays the extra cost of living somewhere else when your home is damaged by something the policy covers. It pays for temporary housing, such as a hotel or an apartment, while the home is repaired or rebuilt. It's also called additional living expenses coverage. The expenses are the costs you wouldn't have if you were still at home.

It pays the difference, not the whole bill

The coverage pays only the difference between your previous living expenses and your new temporary ones. You still make your mortgage payment.

What it usually covers

It typically covers hotel bills. It includes reasonable restaurant meals if you're staying in a hotel room with no kitchen. Other living costs above your normal housing costs count too, for as long as the damage keeps you out of the house.

Limits

Some policies have a dollar limit, and some also have a time limit. These limits are separate from the coverage that repairs or rebuilds your home and replaces your belongings. The declarations page, the first page of your policy, summarizes your coverages, dollar limits and deductibles. Ask your agent, company or adjuster what your policy covers and whether it has a time or dollar limit.

Receipts

Keep every receipt for an added cost, because the insurer needs them to reimburse you. Since the coverage pays only the difference, a note of your usual monthly costs from before the loss shows what counts as extra.

If you have to leave, take your insurance policy and your list of damaged belongings with you. Give your insurer or agent a phone number and an address where they can reach you while you're away.

An annotated example

What to do next

Find the loss of use limit on your declarations page, and ask your insurer whether there's a time limit too. Note your usual monthly food and housing costs, so the extra is easy to show.