Will your homeowners insurance policy protect your lifestyle?

woman and child on bed, eating breakfast

When selecting a homeowners insurance policy, the first thing you’re likely to consider is having adequate coverage to rebuild your home. But what happens to you and your family during reconstruction or relocation while your home is not fit to live in?

You have worked hard to accumulate your assets and wealth over the years and have become accustomed to a certain lifestyle. Loss of use includes additional living expense coverage, which covers the increase in living expenses necessary to maintain your household’s usual standard of living during the time necessary for you to permanently relocate or to return your home to a habitable condition. Although many homeowners insurance policies impose a time and/or dollar limit for this coverage, our policy features broader language that covers all reasonable expenses without a coverage limit.1

In many cases, the minimum amount of time to rebuild a home is one year. Depending on the time it takes to obtain the necessary building permits, the square footage and custom materials used to reconstruct your home, it can take up to 5 years from the time of loss. Whether you live in a 6-bedroom ranch in Scottsdale, a 3-story colonial home in Chicago or a luxury condo in San Francisco, imagine how quickly the costs to rent suitable housing to match your current standard of living would grow into a sizable expense.

How you may be at risk

Consider these scenarios:

  • A pipe bursts in the top-floor master bathroom of your $1 million home. You and your family have to move out for 18 months during reconstruction because the ensuing water damage was widespread. You normally exercise in your fully equipped home gym and regularly entertain friends in your extensive chef’s kitchen. You are worried you will have to compromise your lifestyle during repairs. Our homeowners policy would cover you for housing and gym membership to match your current lifestyle for the reasonable amount of time required to restore your home to a habitable condition. How would your policy respond?
  • A fire starts in your garage and spreads to your home, doing extensive damage. Even though it’s not a total loss, you and your family are required to move out of your home for well over a year while the damaged portion is being rebuilt. You are distraught by the thought of maintaining your usual way of life during this process and finding a pet-friendly place to live. Our homeowners policy would cover you for housing equivalent to your standard of living, which allows pets or pays for kennel costs for your pets. How would your policy respond?
  • A wildfire destroys your $2 million custom-built home. You decide to relocate to another state rather than rebuild. The process to find and purchase the right home with the same level of unique features you are accustomed to will take you at least 6 months. Our homeowners policy would cover your additional living expenses for the shortest amount of time required to settle elsewhere if you decide to permanently relocate, in addition to our replacement cash-out option.2 How would your policy respond?

How Nationwide® Private Client responds

We understand that being out of your home can cause added stress on your family. With the Nationwide Private Client homeowners policy, we offer loss of use coverage to help you maintain your normal way of life.3 Loss of use protects you in 3 ways2:

  • Additional living expense: Covers the increase in your normal living expenses necessary to maintain your standard of living for the reasonable amount of time required to restore your home to a habitable condition — with no dollar limit or deductible. This includes kennel costs for your pets, if applicable.
  • Fair rental value: Allows you to recover lost rent for up to 24 months if the covered loss requires your tenants to leave an insured rental unit on your premises.4

Why it’s important for you

If you incur a significant loss to your home, it’s important to be prepared so you can maintain your current standard of living. Talk to your agent about whether or not your current homeowners policy provides adequate loss of use protection compared with a Nationwide Private Client homeowners policy.

Nationwide Private Client offers these added benefits:

  • Specialized claims service: Our team of problem-solvers is available 24 hours a day, 365 days a year.
  • Deductible waiver: Your homeowners deductible will be waived for a covered total loss.5 With our protection endorsement, deductibles up to $25,000 are waived for a covered loss over $50,000.5
  • Replacement cash-out option: We pay you up to the limit shown on the declarations of your policy, or what it would cost to rebuild at the same location whichever is less. This allows you to rebuild where and when it’s convenient for you.6
  • Realty tax increase assessment: With our protection endorsement, we will pay up to $25,000 for any additional county tax assessments the first year after your home is rebuilt when they are increased due to a covered loss.
  • Mortgage expense: With our protection endorsement, we will also pay up to $5,000 per month and $50,000 total for your increased mortgage payments when the increase is due to a total loss.4
[1] For primary owner-occupied residences only. If home is under construction at time of loss a 24-month cap applies.
[2] In California, loss of use coverage has a cap of 50% of the home’s limit.
[3] Does not cover loss or expense due to cancellation of a lease or agreement. Does not apply to an insured’s business, whether conducted on or off any insured location. Other limitations and exclusions may apply.
[4] Coverage availability, limits and timing vary by state.
[5] Unless a special deductible applies. Does not apply to losses caused by seepage and leakage of water not related to weather, unless an automatic water shutoff device is active at the time of loss. In CA, does not apply if cause of loss is wildfire or brush fire. In some states, applies to deductibles up to $50,000.
[6] Subject to policy requirements for loss of use.