Examples of Additional Living Expenses to “maintain your normal standard of living”
Additional Living Expenses, or ALE for short, is also sometimes called Loss of Use. It is insurance coverage generally offered with homeowner’s insurance that is used to cover expenses that go above and beyond your normal expenses following a disaster.
The amount of coverage varies. Some policies are limited by a dollar amount, some are limited by time and some are limited by both. Read your declaration page and policy carefully to determine what limits exist for you. Please know your limits and plan for them far in advance.
Here, you’ll find examples of items that should be covered with the ALE coverage, following an insured loss.
Partial list of items covered:
- Hotel expenses: tips, dining out, parking.
- “Moral” obligation to pay for housing with friends or relatives (according to AICPCU). Have your friend or relative write a rental receipt and allow them to be compensated for the inconvenience.
- Additional driving mileage (see current IRS or AAA mileage rates).
- Childcare expenses above normal expenses.
- House cleaning service above normal expenses.
- Cost to install and hookup fees for cable and utilities.
- Cost to install phone and forward number to temporary addresses.
- Cell phone, telephone, postage costs above normal expenses.
- Utility bills to temporary power poles might be charged at a higher rate than normal residential rates. The difference between your old bill and the new bill.
- Extra supplies related to living in an RV such as toilet chemicals and difference between the price of regular toilet paper and the special toilet paper you might need to use in an RV.
- Long distance phone calls to insurance company.
- Pet boarding.
- Meals while in hotel or moving above normal expenses.
- Laundry and dry cleaning above normal expenses.
- Costs related to documentation of dwelling, personal property losses.
- Files, paper, notebook and diary costs related to insurance claim. (These are not personal property replacements but directly related to additional expenses due to the loss.)
- Expenses related to replacement of licenses, diplomas, certificates, passports.
- Storage of replacement contents.
Remember: You are entitled to “like kind and quality”
House with your amenities
- Sewing room
- Exercise room
- Gourmet kitchen
House decorated with your “like kind and quality” furnishings
- Art work
- Piano, pool table
It is always a good idea to get as short a lease as possible in this situation, even if you’ve come to the conclusion that it will take two years to replace your house. You don’t want to find yourself locked into a living situation that proves too expensive, or inappropriate in some other way.
More detail can be found in Chapter 11 of our free eBook “A Survivor’s Guide to Insurance”