What are 'additional living expenses' in a homeowners policy?

'Additional living expenses' in a homeowners policy refer to the costs incurred when a covered loss renders the home uninhabitable. This coverage is designed to assist policyholders by providing financial support for temporary housing and other necessities while their residence is being repaired or rebuilt.

When a home is damaged due to a covered peril—such as a fire or severe storm—the homeowner may need to stay in a hotel or rent an apartment. The additional living expenses coverage will cover the extra costs associated with this temporary living arrangement, beyond what the homeowner would normally spend on housing if they were living in their own home.

This coverage can also extend to other related expenses, such as the cost of meals if the policyholder cannot cook at home. It's important for homeowners to understand this aspect of their policy, as it ensures they are not left without financial support during a challenging time. This provision is distinct from coverage for personal property or costs associated with repairs to the home itself, focusing specifically on the additional costs incurred due to displacement.