Managing Moving and Storage Expenses: A Guide for Home Rebuilders
When rebuilding your home after an incident, moving into a temporary rental often incurs additional costs, including moving and storage expenses. Understanding how to manage these expenses, track them accurately, and leverage insurance for reimbursement is crucial.
This article provides detailed guidance on how to approach these costs, including specific examples to illustrate key points.
Understanding Insurance Coverage for Moving and Storage Expenses
1. Homeowners Insurance: Additional Living Expenses (ALE) Coverage
What ALE Covers:
Moving Costs: Costs associated with moving your belongings to a temporary rental.
Storage Fees: Expenses for storing your furniture and personal items while your home is being rebuilt.
Temporary Housing: Rent and other living expenses incurred while you are unable to live in your home.
Coverage Limits:
Policy Limits: ALE coverage typically has a cap, either a percentage of your dwelling coverage or a fixed dollar amount. For example, if your dwelling coverage is $300,000 and your ALE limit is 20%, your ALE coverage would be $60,000.
Duration: Coverage is usually limited to a specific time frame, such as 12 or 24 months, or until your home is habitable again, whichever comes first.
Example:
Policy Details: Your homeowners policy provides ALE coverage up to $50,000.
Estimated Costs: Moving costs are $3,000, and storage fees are $200 per month for 12 months ($2,400 total).
Total ALE Utilized: $3,000 (moving) + $2,400 (storage) = $5,400, well within your $50,000 limit.
Tracking Moving and Storage Expenses
1. Documenting Moving Expenses
Hiring a Moving Company:
Quotes and Estimates: Obtain detailed quotes from multiple moving companies. Ensure the quotes include all costs, such as packing, loading, transport, and unloading.
Receipts: Keep all receipts and invoices from the moving company.
DIY Moving:
Truck Rental: Save receipts for truck rental, fuel, and any additional equipment (e.g., dollies, moving blankets).
Labor Costs: If you hire helpers, document their payments and keep receipts.
Example:
Moving Company: You hire a moving company for $2,500. The quote includes $1,800 for transport and $700 for packing services.
DIY Moving: Alternatively, you rent a truck for $150, spend $50 on fuel, and pay $200 for helpers. Total cost: $150 + $50 + $200 = $400.
2. Documenting Storage Expenses
Self-Storage Units:
Rental Agreement: Keep a copy of the storage unit rental agreement, detailing the monthly cost and any additional fees.
Monthly Receipts: Save all monthly payment receipts.
Full-Service Storage:
Service Contract: Obtain a detailed contract from the storage company, including costs for pickup, storage, and delivery.
Receipts and Invoices: Keep all invoices and receipts for these services.
Example:
Self-Storage: You rent a storage unit for $150 per month. Over 12 months, this totals $1,800.
Full-Service Storage: A storage company charges $100 for pickup, $200 per month for storage, and $100 for delivery. Over 12 months, this totals $2,500.
Filing Insurance Claims for Moving and Storage Expenses
1. Preparing Documentation
Compile Receipts and Contracts: Organize all receipts, invoices, and contracts related to moving and storage expenses. Ensure each document clearly states the service provided and the cost.
Create an Expense Log: Maintain a detailed log of all expenses, including dates, descriptions, and amounts. This log will help substantiate your claim.
2. Submitting the Claim
Contact Your Insurance Company: Notify your insurance company as soon as you know you’ll need to move and store belongings. Ask for specific instructions on submitting claims for ALE coverage.
Provide Documentation: Submit your compiled receipts, invoices, contracts, and expense log to your insurance company. Include a cover letter explaining the necessity of each expense.
Follow Up: Keep in regular contact with your insurance representative to ensure your claim is processed promptly. Be prepared to provide additional information if requested.
Example:
Claim Submission: You submit receipts totaling $3,000 for moving expenses and $2,400 for storage expenses. You include a detailed expense log and a cover letter explaining that your home is uninhabitable and under reconstruction.
Loti can help:
We offer a complete suite of tools for scanning, organizing and submitting a variety of documentation for insurance including receipts, invoices and contracts.
Finding Additional Assistance for Moving and Storage
1. Government Assistance Programs
FEMA:
Disaster Housing Assistance: FEMA may provide financial assistance for temporary housing and related expenses, including moving and storage.
Application: Apply online at DisasterAssistance.gov or call the FEMA helpline.
2. Nonprofit and Charitable Organizations
American Red Cross:
Relocation Assistance: The Red Cross can provide financial assistance for emergency relocation needs.
Contact: Reach out to your local Red Cross chapter.
Salvation Army:
Emergency Assistance: The Salvation Army offers emergency financial aid, which can include help with moving and storage costs.
Contact: Visit your local Salvation Army branch.
Final Tips for Managing Moving and Storage Expenses
1. Plan Ahead
Budget: Estimate your moving and storage costs in advance to understand your potential expenses and coverage needs.
Get Multiple Quotes: Compare quotes from different moving and storage companies to find the best rates and services.
2. Keep Detailed Records
Documentation: Maintain meticulous records of all expenses. This includes keeping copies of contracts, receipts, and payment records.
3. Communicate with Your Insurance Company
Ask Questions: Clarify what moving and storage expenses are covered under your ALE coverage.
Regular Updates: Keep your insurance representative informed about your situation and any significant changes.
Wrap-Up
Rebuilding your home after a disaster involves navigating various additional costs, including moving and storage expenses. By understanding your insurance coverage, tracking expenses meticulously, and leveraging additional assistance programs, you can manage these costs effectively.
This proactive approach will help ensure you are adequately reimbursed and maintain financial stability during this challenging period.