Travel Expenses

Managing Travel Differences and Insurance Considerations When Rebuilding Your Home

Rebuilding your home after a disaster can disrupt your daily routine, including your travel patterns. Whether it's commuting to work, dropping kids off at school, or managing pet care, the differences between your primary residence and temporary rental can lead to increased travel expenses.

This article will help you understand how to track these differences, manage additional costs, and navigate insurance claims related to travel.

Understanding and Tracking Travel Differences

1. Identifying Key Locations

• Primary Locations: Identify key locations you travel to regularly, such as work, school, daycare, pet boarding facilities, and other essential places.

• Rental vs. Primary Residence: Compare the distance and travel time from your temporary rental to these key locations versus your primary residence.

2. Tracking Mileage

Why Track Mileage: Keeping a record of the additional miles driven can help you accurately claim increased travel expenses from your insurance or tax deductions.

Tools for Tracking:

• Manual Logs: Keep a handwritten log of daily trips, including starting and ending mileage.

• Apps: Use mileage tracking apps like MileIQ or TripLog for automatic tracking.

Example:

• Work Commute: Your primary residence is 10 miles from your office, while your rental is 20 miles away. This doubles your daily round-trip mileage from 20 to 40 miles.

Loti can help:

We have built in tools that can help organize and manage your additional travel expenses alongside everything else you will need for insurance.

3. Accounting for Additional Costs

New Parking Fees: If your rental is in a different area with higher parking fees, keep receipts and track these additional costs.

Public Transportation: If you switch to public transportation, track the cost of tickets or passes and any associated expenses.

School Transportation: If your children need a new bus route or alternative transportation to school, document any additional costs or changes in routine.

Example:

• School Drop-Off: Your primary residence was 2 miles from your child’s school, but the rental is 7 miles away. This adds 10 miles to your daily round-trip for school drop-offs and pick-ups.

Navigating Increased Travel Costs and Insurance Claims

1. Additional Living Expenses (ALE) Coverage

What It Covers: ALE coverage in your Homeowners Insurance can help reimburse you for increased living expenses, including additional travel costs, incurred due to your home being uninhabitable.

Documenting Expenses: Keep detailed records of all travel-related expenses, such as fuel, parking fees, public transportation costs, and mileage logs.

Filing a Claim:

• Compile Documentation: Gather all receipts, logs, and any other proof of increased travel expenses.

• Submit to Insurer: Provide a clear explanation of why these expenses have increased, supported by your documentation.

Example:

• Increased Mileage: You drive an additional 300 miles per month for work, school, and errands. If the IRS mileage rate is 56 cents per mile, this adds $168 to your monthly travel expenses.

2. Tax Deductions

Eligibility: If you itemize deductions on your tax return, you may be able to deduct certain increased travel expenses related to disaster displacement.

Consult a Tax Professional: Work with a tax advisor to understand what expenses are Deductible and ensure you meet IRS requirements.

Example:

• Mileage Deduction: You track 2,000 additional miles over six months due to your temporary relocation. At 56 cents per mile, you may deduct $1,120 as a casualty loss if it exceeds 10% of your adjusted Gross Income and you itemize deductions.

Loti can help:

In addition to creating submissions for insurance, our platform can create reports to help organize information for your tax return or CPA.

Managing Day-to-Day Travel Logistics

1. Commuting to Work

Plan Ahead: Determine the best routes and consider alternatives like carpooling or using public transportation to reduce costs.

Parking: If parking fees are higher at your rental, explore options like monthly parking passes or remote parking with shuttle services.

Example:

• Public Transit: You switch from driving 20 miles to using a bus and train combination costing $5 per day, reducing wear and tear on your vehicle.

2. School and Daycare Transportation

Bus Routes: Contact the school district to find out if new bus routes are available from your rental. Some districts may adjust routes for displaced families.

Carpooling: Coordinate with other parents for carpooling to share the driving burden and reduce costs.

Example:

• Daycare Drop-Off: Your new daycare route adds 15 miles per day. Carpooling with another family every other day cuts this to 7.5 miles daily, saving on fuel and time.

3. Pet Boarding and Care

Proximity: Find a nearby pet boarding facility or pet sitter to minimize additional travel.

Costs: Keep records of any increased boarding fees or additional travel costs related to pet care.

Example:

• Pet Boarding: Your rental is 10 miles further from your pet boarding facility, adding 20 miles round-trip. At 56 cents per mile, this costs an additional $11.20 per visit.

Final Tips for Managing Travel Differences

1. Keep Detailed Records

• Receipts and Logs: Maintain meticulous records of all travel-related expenses, including receipts, mileage logs, and public transportation costs. (Again, Loti can help with all of this.)

• Expense Tracking: Use apps or spreadsheets to track daily expenses and categorize them for easy reference.

2. Communicate with Your Insurance Company

• Ask Questions: Clarify what travel-related expenses are covered under your ALE coverage.

• Regular Updates: Keep your insurance representative informed about your situation and any significant changes.

3. Leverage Multiple Resources

• Community Assistance: Utilize community resources like local government transportation programs or school district support for displaced families.

• Employer Assistance: Check if your employer offers any relocation assistance or travel reimbursements for displaced employees.

Wrap-Up

Rebuilding your home after a disaster involves managing increased travel expenses and adjusting to new routines. By carefully tracking mileage, documenting additional costs, and understanding your insurance coverage, you can ensure you’re adequately reimbursed for these expenses. Utilizing a combination of insurance claims, tax deductions, and community resources will help you navigate this challenging period more smoothly and maintain your financial stability.