Fire or burst pipe: who pays for the hotel, and for how long

Tonight: get out, book the room, keep the receipt

If the home is not safe to sleep in, get everyone to a hotel first. Then call your insurer's claim line as soon as you can, open the claim and ask one question: what is my loss of use limit?

Keep every receipt from the first night on: the room, meals, gas, laundry. New Jersey's insurance department tells policyholders to save all of them.

Who pays

For a covered loss like a fire or a burst pipe, the loss of use part of your policy (Coverage D on most homeowners policies) pays the extra cost of living somewhere else while the home is unfit to live in. Renters and condo policies usually include a version of it.

It pays the difference, not everything. Your mortgage or rent continues, and the policy covers what you spend above your normal costs. Some carriers pay the hotel or housing provider directly and others reimburse you from receipts. Ask which one yours does on the first call.

What is not covered

Flood is the big one. A standard homeowners policy does not cover flood damage, so it will not pay living expenses for a flood, and flood policies through NFIP generally do not include temporary housing. If you are not sure whether your water damage counts as a burst pipe or a flood, ask the adjuster in writing.

How long you can stay

As long as the repairs reasonably take, up to the limit in your policy. A common limit is 20% to 30% of your dwelling coverage, or a time limit such as 12 months. Your declarations page shows yours.

If an authority orders you out but your own home is not damaged, for example after a fire next door, the standard policy covers up to two weeks.

When to move from the hotel to a furnished home

A hotel is right for the first days. If repairs will take more than a few weeks, ask the adjuster to approve a furnished apartment or house instead. The standard policy language is about keeping your normal standard of living, and a family in one hotel room for months is not that.

A furnished place on a 30 night or longer term usually has a kitchen and laundry, so the extra meal and laundry costs come down too. See temporary housing for insurance claims in NJ, and my longer guide on how loss of use coverage works in NJ and NY.

Your rights on timing

In New Jersey, insurers have to acknowledge your claim within 10 working days and, for property claims, pay within 30 calendar days after a properly completed proof of loss, or tell you in writing why not.

In New York, insurers have to acknowledge your claim within 15 business days, accept or reject it within 15 business days of getting your proof of loss and paperwork, and pay within 5 business days of a settlement.

What to ask on the first call

• What is my loss of use limit, and is there a time limit?
• Do you pay the hotel directly, or do I pay and send receipts?
• If repairs take more than a few weeks, will you approve a furnished rental?
• Who is my adjuster, and what is the best email for them?
• Can you confirm all of this by email?

If you need a place now

We find hotels for the first nights and furnished homes for longer repairs across New Jersey and the New York area, and we work directly with adjusters. See insurance housing, call (201) 241-2792, or send the details below.