According to the attached policy language regarding additional living expenses, and assuming the insured is within the policy's time period to recover benefits, would it be reasonable for an insurer to reimburse an insured under this coverage for expenses such as ongoing groceries, daily coffee, and daily meals when an insured is still displaced from their home but in a fully stocked Airbnb?
Same question regarding whether it would be reasonable for an insured to provide reimbursement for a 5 week Airbnb out of state vacation and commensurate dog boarding facility fees during this vacation period?
Colorado Subscriber
It really depends on the details of the Airbnb - if the kitchen is stocked with food similar to what the insured uses at home, the insured should use that. If there's an extra charge for use of the food, that would be covered.If an insured went to Starbucks for coffee before the loss, then there's no coverage under ALE for that expense; it's an insured's normal expense. Likewise, if the insured normally cooks at home and is able to cook at the Airbnb, restaurant meals would not be covered.
ALE is only for costs above normal - insureds need to eat; if they normally eat out then the cost of eating out would not be covered since that's not an increase in their expenses. If they normally cook at home and have access to a fully stocked kitchen while displaced, then again, restaurant meals wouldn't be covered, since they can continue to eat normally. Only costs above normal are what ALE provides - additional living expenses. For example, if an insured who normally eats at home spends $100 a week on groceries and is now displaced to a hotel and is now spending $200 on meals out, the insured is entitled to $100 for that additional cost above the insured's usual grocery bill. Or if the insured doesn't like the food in the Airbnb and buys his own groceries instead like normal, that is not an increase in expenses.
While the insured is entitled to go on vacation while displaced, only the costs above their normal living expenses are covered because of the displacement. Boarding the pets because the insured decides to go out of town would not be covered. The insured's boarding the pets on vacation is a normal expense, so no ALE is available for that. Likewise, if the out of state Airbnb is more expensive than the local Airbnb, only the costs of the local Airbnb would be covered. The insured does not get to charge an out of state vacation to the insurer.