Does home insurance cover temporary accommodation?

Upon filing a claim following a disaster like a flood, most insurers will likely first ask an inspector to confirm that your home is too damaged to live in, and subsequently cover the cost of temporary accommodation. 

The insurer will typically cover the cost of renting a similar home to the one you were living in, so you can hopefully minimise the disruption to your lifestyle, given the circumstances. If this accommodation is located far from your original home, the insurer may also help cover some of your family’s extra travel costs.

If circumstances don’t allow you to rent appropriate accommodation, the insurer may be able to set you up in a hotel or AirBNB as an alternative. If your belongings won’t fit in the temporary accommodation provided to you, the insurer may also offer you access to commercial storage space as part of the policy.

If you are a pet owner, check if your home insurance policy covers the cost of temporarily housing your pets elsewhere. If this is included in your home insurance policy, your pets can be put up into a professional animal boarding home at the same time as you’re staying in temporary accommodation.

Some insurers set aside a budget for temporary accommodation out of your home’s sum-insured amount, such as 10% or 20% for example.

Other insurers may set a time limit on how long you can stay in temporary accommodation being paid for by the policy – 12 or 24 months, for example. In other cases, it may last for as long as it takes to make your original home safe to inhabit again.

While temporary accommodation is typically only offered if an insured event leaves your home uninhabitable, a few insurers may offer temporary accommodation if the local council or other governing authority orders an evacuation in anticipation of a problem or disaster. This emergency accommodation may only be available on a short-term basis, lasting as long as the emergency.

Be sure to read the PDS and contact the insurer if necessary to confirm how long you’ll be covered for temporary accommodation.

Temporary accommodation may also be offered as part of a contents-only insurance policy, such as renter’s insurance. Even though these policies only cover your possessions, they may still offer options to help you manage the cost of finding a new place to live if a disaster leaves you unable to rent in your original home.

Also, some home-only insurance policies like landlord insurance offer temporary accommodation for tenants if the investment property is rendered uninhabitable by an insured event.