Homeowner and rental insurance policies typically include a coverage type called additional living expenses, or ALE. On your policy, this coverage is usually listed as Coverage D or "loss of use." It covers the additional living costs you face when your home is damaged and you need temporary housing while repairs are underway or your home is rebuilt following a covered loss.
After a wildfire, for example, structural damage or smoke contamination could make your home unsafe to live in. ALE coverage would pay the difference between your temporary living expenses and your normal spending. This can include the cost of meals beyond your normal budget, pet boarding, laundry costs, and extra mileage if you need to commute farther.
ALE coverage is usually triggered when your adjuster determines your home is uninhabitable. This condition is based on the home's safety and availability of services like water, electricity, and heat. A government-issued evacuation order can also be a trigger for ALE, depending on your policy's terms.
What ALE covers
When your home is uninhabitable, additional living expenses coverage can help pay for these extra costs:
- Temporary housing such as a hotel or short-term rental
- Meals above your usual food costs if you don't have a kitchen
- Storage
- Moving costs
- Laundry and dry cleaning
- Pet boarding
- Extra transportation costs to get family to work and school
What ALE doesn't cover
Some common expenses that ALE won't cover include:
- Your normal mortgage or rent at the damaged home
- Normal utility costs at your damaged home
- Luxury lodging — the temporary housing must be comparable to your normal housing
- Unrelated shopping, entertainment, and non-essentials
You can ask for an advance
In some cases, your insurer can issue advances against your ALE limits or your personal property coverage so you're not fronting the full cost on essentials and things like security deposits and first month’s rent.
Ask for an advance in writing with a specific, itemized amount. You’ll reconcile the advance with receipts later.
Requesting an ALE advance
You can download our ALE advance request letter template and fill it in with your information and expenses.
Download an ALE advance request letter template (DOCX 38.51KB)
Requesting a personal property advance
If your entire home was destroyed, you can ask for a “personal property advance.” Personal property coverage is listed as Coverage C on your home or renter policy. Personal property advances are more commonly granted in total-loss situations because insurers understand you will need to replace essential belongings immediately. Unlike ALE advances, a personal property advance does not reduce the limited pool of ALE funds you rely on for temporary housing.
Preserving your ALE is crucial because it covers the extra costs of living somewhere else while your home is being repaired or rebuilt. Once ALE runs out, insurers generally do not extend it. Choosing a personal property advance when possible helps ensure you have enough ALE available to pay for temporary housing while you're displaced.
Download a personal property advance request letter template (DOCX 38.61KB)
ALE coverage limits
ALE may be capped by a dollar amount, a time limit, or both.
The dollar amount is usually 20% to 30% of your dwelling coverage. For example, a home with $100,000 in dwelling coverage and a 20% cap would have an ALE maximum of $20,000 paid toward additional expenses. The time limit is usually 12 to 24 months.
Wildfires and other types of disasters often stretch out rebuild timelines due to contractor shortages, debris removal, permitting, and environmental testing. It's important to regularly review your policy and know both limits to ensure you have enough ALE coverage. Check your ALE limit against typical rental prices nearby and talk with your agent if it seems low. After recent wildfires, many people found their ALE ran out before they could return home, so yearly reviews can help prevent surprises.
Track your expenses for reimbursement
Advanced living expenses coverage only covers the extra costs you take on, so tracking your normal expenses and your temporary ones is important. Here's how to stay organized:
- Figure out your normal costs first. Take a look at bills and bank statements to get an idea of what you typically spend each month.
- Save your receipts. Keep all your hotel, meal, laundry, and storage receipts. It's also a good idea to keep a mileage log while you're displaced to record how much extra you're driving.
- Send a monthly packet to your insurer. A packet with receipts and noted temporary vs. normal costs will ensure your insurer processes your reimbursement faster.
- Note what housing is available. Temporary housing options may be limited or spike in price following a disaster like a wildfire. Take screenshots of a few examples to help your adjuster understand the local market conditions.
National flood insurance policies and ALE
Most National Flood Insurance Program (NFIP) policies do not include any additional living expense coverage. This means if flooding makes your home uninhabitable, NFIP will not pay for temporary housing, meals, storage, or other displacement costs. Homeowners relying solely on NFIP often discover this gap only after a major flood. It may be worth considering a private flood policy to get this coverage for a flood.
Contact our consumer advocacy team if you have questions about ALE coverage or believe yours has been reduced or cut off early.