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Second Homes and Additional Living Expense

Are you a homeowners or renters insurance policyholder? Click here first to learn about Additional Living Expense and other things you may not know are covered in your homeowners insurance policy.


Leslie Mowers, ALE Solutions National Account Manager, continues our series of posts regarding questions relevant to loss of use claims. Leslie addresses two common scenarios regarding the insured utilizing their policy’s Additional Living Expense (a.l.e.) over opting to receive a Fair Rental Value (FRV) payout.

Note: As a general rule, when a policyholder is requesting payment for Additional Living Expenses, not all requests are covered, and they must meet certain criteria before they get paid. Of course, we suggest comparing our answers to your specific Additional Living Expense policies.

How Does ALE Work with Second Homes?

Q. The family wants to buy a camper and live in it on their property. Would you reimburse the family for this? How would you determine the amount?

ALE’s housing solutions do not directly reimburse the policyholder for the purchase of a trailer/camper. All reimbursements for a trailer/camper purchase would need to go through the policyholder’s Insurance Carrier. ALE can assist in determining the cost to rent a temporary trailer/mobile home. We would obtain a quote for such a set-up through our national vendor and provide the information to the adjuster handling the policyholder’s loss. The adjuster would then determine an acceptable purchase price and work this out directly with the policyholder.

Q. The insured’s damaged residence is a vacation home. Would they be entitled to any additional living expenses? What are the key considerations in the amount?

Yes, the policyholder is entitled to additional living expenses for their weekend home. The adjuster handling their loss will determine how long repairs will take. Depending on the time of year and how often the family uses the home, the adjuster will indicate if the policyholder will need a temporary rental or hotel to meet their needs. Based on the number of bedrooms and square footage, ALE provides a Fair Rental Value (FRV) to the adjuster for a home in the area of loss comparable to the damaged home. We provide the average cost to rent a home to the adjuster to help determine how they would like to proceed and if our assistance will be needed to set-up a temporary rental or a hotel stay for their policyholder.

Photo credit: ©iStock.com/LesPalenik

leslie-circleI LOVE MY JOB because “I feel the work I do makes a difference in the lives of the families and adjusters I provide assistance to each day. I have been with ALE for over ten years, and I consider my co-workers my second family and home away from home. I LOVE coming to work every day.”
– Leslie

 

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