NerdWallet: How your homeowners insurance can bail you out in some surprising situations

by | May 25, 2023 | Stock Market

This article is reprinted by permission from NerdWallet.  You probably already know that homeowners insurance covers your house and everything in it, but there’s actually a lot more to your policy. Depending on the circumstances, your homeowners insurance could also pay for a hotel stay, a suitcase stolen on vacation or even a lawyer to defend you in a lawsuit. Here’s a peek at a few useful features that might be available in your policy.

1. Living expenses if your home is damaged Say an electrical fire leaves your home unsafe to live in. You don’t have to pay out of pocket for a hotel or crash on a friend’s couch for months on end while waiting for repairs. Instead, turn to your loss of use coverage. This part of your policy can help you “maintain your normal standard of living,” says Justin Skipton, a vice president for the National Association of Public Insurance Adjusters. For example, your policy could pay for an extended-stay hotel or a rental apartment where you can have a full kitchen plus space for kids and pets, Skipton says. You can also get reimbursed for things like extra transportation costs if your rental home is farther away from work or school. Your insurer will often cap your expenses at a certain percentage of your dwelling coverage limit, says Alaina Hixson, director of sales and operations at The Churchill Agency in Brentwood, Tennessee. So if you have $200,000 of insurance on the structure of your house and your loss of use coverage is 20%, you’d have up to $40,000 to put toward living expenses while you’re away from home. Time limits may apply, such as 12 or 24 months. Note that your costs should be reasonable. “If your $150,000 house burns down, you’re not going to be able to stay at The Ritz-Carlton or some high-end hotel for a year while yo …

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