What Is Loss of Use Insurance?

Insure your boat for loss of use if you use it to earn income.

When you purchase insurance, you may request additional coverage. Loss of use is one you may select, whether you are purchasing homeowners or automobile insurance. You may find loss of use coverage available for boat insurance or even renters insurance. Loss of use covers a rental car or boat while the insurance company has yours repaired as a result of an accident. Loss of use pays for motel expense or a rental while you cannot live in your home or apartment because of some covered peril.

Renters and Homeowners Insurance

If you make a claim on your renters insurance or homeowners coverage, you may need loss of use insurance to pay for a place to live. Living expenses may be substantial while you wait for a contractor to repair your home after a water leak or an electrical fire. Loss of use insurance keeps you from moving in with the relatives and pays reasonable and customary living expenses up to the limit in your policy.

Boat and Car Insurance

If you are in an automobile accident, you may need a rental vehicle to get to work while your vehicle is in the shop. Your boat insurance may also cover loss of use. Theft is an occasion to need loss of use insurance. Have your loss of use coverage confirmed and a rental or substitute approved before you rent. You are usually entitled to a vehicle in the same class as the one you own and for an approved length of time. If your boat or car is a total loss, your insurance policy will restrict your rental to 30 days or less.

Request Loss of Use Coverage

Loss of use may not be offered, reports CompuQuotes website. Some insurers add it by endorsement on an auto insurance policy. It is inexpensive and worthwhile if you need your insured vehicle, boat, house or rental for your work or for office space.

Difference in Loss of Use and Additional Living Expenses

An additional living expenses clause pays only living expenses beyond your usual expense. It does not provide the same coverage as loss of use. Additional living expense coverage applies only if you have an actual loss at your home; it will not cover an evacuation because of a fire next door or a chemical spill in town. Loss of use coverage will cover prevention of use by civil authority. If you cannot use your house because the police, fire department or local disaster office requires that you vacate, you are covered with the loss of use clause.