How Temporary Housing Works for Insurance Claims

It’s a situation none of us wants to think about, but occasionally homes do get destroyed or rendered uninhabitable by fire or natural disaster. If it happens to you, it can feel like the end of the world. Even if no one was hurt, you’re facing the potential loss of many belongings, possibly of sentimental value — not to mention the question of finding temporary housing for your family and yourself while you figure out what comes next.

The good news is that if you carry a good homeowner’s or renter’s insurance policy, there is probably a provision in there that allocates funds for temporary housing in the event of fire or natural disaster. You’ll usually find this provision under a “loss of use” coverage clause or even “additional expenses.” (If your current policy doesn’t provide this coverage, we highly recommend getting one that does.) By default, many insurance companies (and homeowners) assume that “temporary housing” means putting your family up in a hotel while repairs are made to your home. But this poses another set of problems: What happens if you can’t move back home for months? Is your family supposed to stay in a cramped hotel all that time? And since hotels are expensive, what if the hotel costs are more than your coverage allows, whether as a daily rate or a total amount?

A Better Solution

This dilemma can be solved by another, better option: Obtain temporary housing through a corporate housing agency. Instead of defaulting to a hotel, you and your family can stay in a fully furnished luxury apartment. This option gives your family plenty of space and all the comforts of home — not to mention any additional amenities offered by the apartment complex — and your insurance company will love it because it usually costs significantly less than a hotel stay.

How Insurance Works with Temporary Corporate Housing

In most cases, your insurance covers corporate housing in much the same way the policy would handle a hotel stay. This typically happens in one of three ways:

  • Your insurance company handles the arrangements with the housing provider directly. This option is the easiest because you just get to move in without worrying about up-front costs. If your policy works this way, you may need to advise the insurance company of your wish to stay in corporate housing so they don’t put you in a hotel by default.
  • You file a claim and the insurance company reimburses you. This option requires you to pay upfront for your housing, but you get it back eventually.
  • You obtain an advance payment from the insurance company. If your insurance provider wants to reimburse your claim, you may be able to get them to advance you part of the money up front. This option provides a suitable compromise if you don’t have the money to pay out of pocket initially.

Other Important Tips

A couple of other things you need to be aware of when looking at temporary housing after a disaster:

  • Corporate housing may not be covered in the event of flood. Most homeowner’s and renter’s policies don’t cover floods. If you live in a flood-prone area, you may be required to carry separate flood insurance FEMA’s National Flood Insurance Program (NFIP), but this provision also doesn’t cover additional living expenses like temporary housing. If you’ve been displaced by flood, contact FEMA to find out your best options.
  • Read the fine print of your policy — before disaster strikes. Don’t assume your housing is covered in the event of a disaster; make sure of it. Find out how much money your policy allows for additional living expenses or loss of use, and find out whether the insurance company prefers to handle the arrangements or reimburse you. That way, you’ll be prepared for what happens with fewer surprises in the event of a disaster.

In Atlanta or Jacksonville, TP Corporate Lodging will work with your insurance company to get your family into a comfortable, fully-furnished temporary apartment in the event of fire or natural disaster. To learn more, call us today at 800.428.9997.