The insurer agreed on temporary housing for two months to the insureds, during the recent school year 4/25 -6/27 approximately 8 1/2 weeks.
The insured's requested living at home while the kitchen was under repairs and inoperable.(Cost allowance for temporary housing $7500.00 per month) Order meals in or go to dinner within the food allowance boundary -$200.00 per week their normal costs eating at home, anything above and beyond. This makes daily school smooth and a normal routine. They wanted to live in a hotel on weekends. This all in place of finding suitable temporary housing. Insurance company agreed at $200.00 per night as a hotel charge which is midrange in their residential area of Pennsylvania.
Memorial Day weekend fell into that timeframe. The family decided to visit family the weekend and an additional day. They stayed in a hotel in Florida , obviously paid their own airfare, but the insurance carrier is considering it a vacation and is refusing to pay for lodging and meals. Is this legal to do by the carrier?
Pennsylvania Subscriber
ALE is for an insured's increase over normal expenses. While an insured is allowed to travel while displaced, all that's owed is reasonable costs because of the displacement, which would be the temporary housing costs of $200 a night and the $200 a week food budget. Anything over that would not be covered because it's not extra expense due to the loss, it's extra expense due to going to Florida on vacation. Unless there's policy language to the contrary, that's how it should be handled. We are unaware of any laws that would dictate how ALE is determined.