Does Renters Insurance Cover Hotel Stays?

If you’re forced to leave your rental due to a covered cause, your renters insurance can help cover the cost of temporary housing like hotels, motels, or even Airbnb rentals.

Keep in mind that your policy will typically only reimburse you for expenses above your usual living costs at home.

Loss of Use coverage: What you need to know

Loss of Use (LoU) coverage is a crucial component of your renters insurance policy. It comes into play when a covered peril, such as a fire or windstorm, damages your rental property, making it uninhabitable during repairs.

LoU coverage helps with the additional expenses you’ll incur while finding temporary housing.

Keep in mind that most renters insurance policies don’t cover damage from specific natural disasters like floods and earthquakes. Always review your policy’s list of covered perils.

Apart from hotel expenses, your additional temporary living costs may include increased food delivery, laundry, moving fees, storage costs, parking, and pet accommodations. Remember that you can usually claim the difference between your usual spending and the increased expenses during the Loss of Use period.

Many renters insurance policies cover additional temporary living expenses for up to 12 to 24 months or until your home becomes habitable again. Lemonade’s Loss of Use coverage, for instance, lasts for a maximum of 24 months.

Filing a claim

Typically, you’ll need to pay for your temporary living expenses out of pocket and then file a claim with your insurance company for reimbursement.

They may require receipts and a detailed account of your expenses to ensure they fall within your policy limits and are related to the covered peril.

Are Airbnb stays covered?

Loss of Use coverage isn’t limited to traditional hotels; it also extends to temporary accommodations like short-term rentals, including Airbnb.

The coverage aims to provide for a comparable temporary living situation.

What about your pets?

If you can’t stay in your home and need separate accommodation for your pet, some insurance companies, including Lemonade, cover reasonable additional boarding fees under Loss of Use coverage.

Lemonade even offers pet health insurance that you can bundle with your renters policy for added savings.

Other things to keep in mind

• In general, landlords are not required to cover your housing expenses, especially if the event was beyond their control, such as a natural disaster. If the damage resulted from their negligence, they might be responsible for your housing costs.
• Not all renters insurance policies include Loss of Use coverage, so be sure to check your policy documents.
• The coverage limit for hotel stays varies based on your policy, with some policies offering a percentage of your personal property coverage limit, while others have a set dollar limit.
• Even if you stay with friends or family instead of a hotel, you may still incur additional expenses, which could be considered as part of your Loss of Use claim.
• Whether renters insurance covers a hotel stay due to a power outage or water outage depends on the cause and your policy specifics.

Before you go…

Getting a renters insurance quote is quick and easy. Click the button below to get your quote. As of March 31, 2023, the average price of a Lemonade Renters policy in the U.S. was around $14 per month.