When matching policyholders with the best temporary housing solution after an emergency, busy claims professionals need to quickly sort through many obstacles. Often, misconceptions about housing availability, options, and costs can impact their workload balancing act, causing further stress for both claims professionals and policyholders as well as wasting valuable time and money.
Let’s debunk the five biggest myths about temporary housing and insurance claims to help claims professionals stay on track—no matter what housing challenge comes their way.
Myth #1: Temporary Housing Only Works for 30-Day Stays or Longer
One long-held belief is that temporary housing can be booked only for policyholders requiring 30-day stays or more. Actually, a few experienced housing providers offer flexible apartment options and often can accommodate shorter stays—even single-night accommodations in some cities, depending on local regulations.
A temporary housing company that has ready access to apartment inventory can provide greater flexibility than a company working mostly with independent property owners. Experienced providers typically manage (and sometimes own) an entire block of apartments in various markets throughout the U.S., which provides policyholders with more inventory options.
There are many reasons why policyholders may need emergency housing only for a short time. Some of the more common reasons include:
- Water damage caused by washing machines or toilets overflowing from upper-floor units to units below, requiring professional water and sewage removal services and mold remediation.
- Furnace discharges that blow dust and soot throughout a home, forcing the family to vacate during cleanup efforts.
- Small kitchen fires that can require families to relocate for one or two weeks.
Regardless of the reason or length of stay, a trusted temporary housing provider should be able to provide claims professionals with a wide variety of solutions and options, including home and apartment rentals and even travel trailers and mobile homes.
Depending on local regulations, some providers can offer flexible lease terms in many cities for stays of less than 30 days without adding premiums on shorter lease terms. Companies may be able to offer this solution versus a hotel option the moment the claim is filed as long as the housing is available.
In addition, providers often keep “market ready” apartments, allowing policyholders to move in immediately if the units are available. Depending on market conditions, if an apartment is already in inventory and available, a policyholder may be able to secure it at a discount, too.
Myth #2: Temporary Housing Is Too Expensive
Hotels are often the go-to option for many claims professionals because they are considered the simplest, least-expensive choice. However, there are many options available when it comes to temporary housing, including fully furnished apartments and homes, which often are less than the cost of a hotel stay. In fact, depending on the market, a two-week stay in a hotel can equal the cost of a 30-day stay in an apartment.
Depending on the policy, you frequently can secure coverage for your policyholder’s temporary housing to comfortably accommodate their family, any special needs, and even pets—all while saving time and money.
Fully furnished apartments not only feel more like home, but also they offer many savings, such as providing everything from dishes and silverware to modern furnishings to eco-friendly and water-saving appliances and in-unit laundry facilities. And when families have access to a kitchen, they often prepare meals instead of eating out, which can save on the additional living expense (ALE) portion of a claim.
To illustrate the overall cost savings that claims professionals can expect on average, here is a comparison of an actual 30-day stay in a hotel versus a provider-owned property:
Hotel Provider-Owned Property
Daily Rate $239 $149
Tax Rate 10% 0%
Total $7,887 $4,470
Total Savings $3,417
*No parking fees were charged in either option.
Experienced temporary housing companies can deliver catastrophe and emergency housing during high-demand times when area hotels are sold out or room rates are at a premium. Often, they can lock in a 30-day “continuous stay” lease for an apartment at a negotiated rate instead of opting for a hotel, where the rate continues to fluctuate during the stay or involves blackout dates.
Myth #3: The Process Is Complicated With Too Many People Involved
Working with a temporary housing provider should be simple and make your job easier. Providers should take all of the guesswork out of the process, leaving claims professionals with more time to focus on the claim itself. Good providers should offer a one-stop shopping experience with:
- One contact point, usually a dedicated account manager, to guide policyholders through the housing process after an emergency or catastrophe.
- Coordinated move-in and move-out with efficient management of all the major details, including setting up utilities and phone service and handling maintenance requests.
- A service team available 24/7 to answer claims professional and policyholder questions and solve potential issues.
- Flexible billing options, providing invoicing options and reports for claims professionals who track many accounts and consolidated billing and reporting for policyholders and catastrophe teams. Temporary housing providers can handle billing and usually pay property owners directly, making it easier on your policyholders.
In addition, qualified housing providers complete an initial counseling session with policyholders to identify their needs. With research and data on a loss address, they also may provide a fair market value assessment of a policyholder’s home based on its size and amenities. Providers work with claims professionals to validate that information to ensure housing options offered are of like kind and quality.
Myth #4: Housing Providers Don’t Know My Policyholders’ ALE Benefits
Expert housing providers typically support a trained service team that knows and follows individual carrier ALE policies and budgets. Many have specific tools and technologies to manage ALE benefits on behalf of insurance clients. These tools typically include web portals and other applications that enable a housing vendor to keep track of policyholders’ ALE benefits and notify the claims professional when they are approaching the policy limits.
Temporary housing providers can provide significant ALE support to claims professionals and policyholders by:
- Asking the claims professional the right questions up front to better understand the policy and circumstances/nature of the claim.
- Identifying and tracking total ALE dollars available for housing.
- Tracking a claim’s ALE balance any time an extension is made.
- Keeping the housing end-date open to accommodate extensions as needed.
- Providing shorter vacate notices to allow for unexpected circumstances.
- Notifying the claims professional when a policy is within $5,000 of the ALE limit.
- Obtaining records up front for any initial ALE payouts to the policyholder from the claims professional to ensure those payouts are included in the total ALE calculation.
Myth # 5: It’s Impossible to Match a Policyholder’s Unique Needs
A temporary housing provider should be able to deliver housing of like kind and quality to all policyholders, whether for a young couple in a small condominium, a large family with pets, or a family living in a more expensive high-end home.
Interestingly, while temporary housing is the smallest dollar portion of a claim (typically accounting for about five percent), a policyholder’s experience in their temporary home often is used as a barometer of the overall claims experience. Claims professionals have a great opportunity to leverage a good housing provider’s expertise in matching like kind and quality and then using the experience to boost customer service.
Effective providers have the experience and knowledge to deliver the most flexible housing solutions for policyholders in challenging or special situations, such as:
- Individuals with special needs, such as first-floor access and handicap accessibility.
- Those with medical needs, often for the elderly, where a hospital bed, wheelchair, or various other medical equipment may need to be accommodated or on-site health care facilities are required.
- Those owning high-end or specialty vehicles that call for covered parking or additional garage space.
- Larger families with pets that need common areas for gathering, playgrounds on-site or parks close by, and schools and day care facilities in close proximity to the property.
Claims professionals also may appreciate access to more creative housing options, like travel trailers, for policyholders who live on large properties and manage a farm or livestock. This option allows policyholders the convenience of continuing their day-to-day duties and offers the added security of tracking construction progress on their home.
Other creative solutions may be necessary to accommodate larger families displaced for shorter periods. An experienced housing provider will work to find a larger apartment, home, or even two apartments next door to each other to provide additional space as well as a kitchen and in-unit washer/dryer for extra comfort.
Temporary housing often is pet friendly, too, which is important since many policyholders own pets. In fact, 65 percent of U.S. households own a pet, according to the American Pet Products Association’s 2015-2016 National Pet Owners Survey.
Ultimately, claims professionals can and should expect a reliable temporary housing company to offer flexible emergency housing options to match their policyholders’ coverage and needs, whether for an overnight stay or year-long period. In addition, the provider must understand individual carriers’ ALE policies, remove any guesswork from the process, and deliver creative solutions when necessary.