In most incidences there will have to be “damage” to your home or its contents to trigger the alternative accommodation cover. The majority of companies would expect the policyholder to agree the alternative accommodation arrangements with the loss adjusters prior to committing themselves to alternative accommodation.
In all cases policyholder should be mindful of the length of time they will require alternative accommodation and the specific policy’s limits on providing cover in this type of incident (typically 20% of the sum insured).
In the unlikely event of the alternative accommodation portion of cover being used up, it will be your responsibility to make your own accommodation arrangements and to pay for them. Where you are out of your home for only a short period, ‘reasonable costs’ in respect of hotel accommodation are usually acceptable. Such costs will typically be reimbursed as soon as it is practical.
However, when you require long-term accommodation, the loss adjuster may locate a property, while some insurers may arrange to pay these bills directly. Alternative accommodation must be reasonable and in keeping with your normal lifestyle. Always obtain your insurer’s approval before incurring any costs.
Where there are two insurers – the building insurer and the contents insurer – the building insurer would be expected to take the initiative with regard to arranging alternative accommodation. If you prefer to be near your property when the floodwaters have gone some insurers, depending on the circumstances, may arrange for a mobile home to be placed in your garden.