The importance of alternative accommodation cover

Damage to your home following a flood, fire or escape of water can be extensive – and it may take longer that you think to get your home back to normal. Your first step is to move into alternative accommodation, but what alternative accommodation cover do you need?  Here, Client Director Steve Moores takes a look.

Alternative accommodation cover

In my experience one aspect of home insurance which is often overlooked is alternative accommodation. This is the amount payable by an insurer to cover the cost of renting a temporary home for you and your family (any pets) following a claim which leaves your home uninhabitable.

When will I need alternative accommodation cover?

• Escape of Water. Water leaks can cause thousands of pounds worth of damage and properties can take months to dry out before repairs can be completed. This may prevent you from living in the property.
• Flood. The damage to your home from a flood can be extensive and it may take longer than you think to get your home back to normal.
• Fire: Even a minor fire can weaken the structural integrity of a building.

An example of alternative accommodation cover

Your home is insured for £700,000 and there’s a claim which means you can’t live in it.

A basic policy may give you 20% of the buildings sum insured to put towards alternative accommodation, so you’ll have £140,000 Take a look at your current policy. Is there sufficient cover to allow your family and pets to live in a similar local property for as long as any repairs may take?

What should I consider when looking at my alternative accommodation cover?

• If your property is listed, then consider the increased length of time at the planning stage. This is to ensure the repair/rebuild meets with planning authority requirements.
• Take into consideration potential labour or material shortages which may result in a three-month repair taking six months.
• Factor in the costs of renting where you live. Ensuring you have enough cover is particularly relevant in London and the south east where the cost of renting a home is proportionately higher.

What alternative accommodation cover is available?

A standard home insurance policy may give you 20% of the buildings sum insured to put towards alternative accommodation. This may mean you having to move to a different location, to a smaller property in the same location, or fund the rent for a more suitable property from your own pocket.

Some mid or high net worth policies will give you a guaranteed five years’ alternative accommodation in a similar sized property in the same area – minimising change in an already stressful situation. There are other benefits to mid net worth policies which you can read about in our article: What is a mid net worth home insurance policy?

Forced evacuation

Some policies include cover for forced evacuation, even if there’s no damage to your property. These cover events where you may be denied access to your home by the police or public authority, such as a nearby sinkhole, an adjacent building deemed unsafe, or a gas leak in the vicinity. It’s designed to cover you for alternative accommodation and to cover a reasonable increase in daily family living expenses for up to a year.

How Howden can help

It can sometimes take months, or even years, to reinstate a property to its pre-claim state, especially in the event of a fire, if the property is listed, or if access is difficult. The right alternative accommodation cover is therefore very important.

At Howden, we are high-value home insurance specialists, and the policies we arrange include a generous provision for alternative accommodation. We can tailor a policy to best suit your needs and ensure that your alternative accommodation, in the event of a claim, is enough for you and your family.

To speak to Howden about your insurance, please call 020 8256 4901 or email privateclients@howdeninsurance.co.uk