Suppose your rental unit becomes uninhabitable due to damage from a fire or a massive storm, your renter’s insurance will help protect you financially. Additional living expenses, including the cost of replacing any damaged personal belongings, personal liability and litigation costs, and even the cost of a stay in a hotel are claimable.

This article discusses when your insurance policy will cover the cost of a hotel room if your rental becomes unliveable and the instances when it won’t cover additional living costs.

Related: How much does renters insurance cost?

When does renter’s insurance cover a hotel stay?

If you need to move out of your rental property because of unexpected damage from perils listed in your renter’s insurance policy, the cost of a hotel stay is covered. Your renter’s insurance also includes loss of use coverage.

The loss of use coverage is built into your insurance policy and is a designated maximum amount per claim. However, keep in mind that an insurance claim must be filed first to determine the extent of the damage before the loss of coverage and your reimbursement for costs begins.

Covered perils listed in your insurance policy include:

Is it worth getting renter’s insurance? Not only will your insurance pay for your hotel, but additional expenses that you may not know are covered can also be claimed. Relocation costs, gas and transportation if you need to move further away, storage unit costs, pet boarding, and groceries are also covered by your renter’s insurance.

Your rental insurance policy also covers any liability or litigation costs that arise as a result of damages to the rental unit or any personal injuries that third parties may claim. Remember, loss of use coverage only covers temporary accommodations while your rental unit remains uninhabitable due to a covered peril.

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When doesn’t your renter’s insurance cover a hotel stay?

Your insurer can deny the loss of use coverage for a few different reasons. These reasons include any damage to your rental unit occurring from an uncovered peril or when a false claim is filed. In either of these two cases, any alternative living arrangements will not be reimbursed by your insurer.

Additionally, inconveniences aren’t covered by your insurance provider. This includes events like a power outage, even if that outage lasts for more than a week, you will be unable to claim loss of use coverage in this instance.

Another reason your insurance provider won’t reimburse you is if the cost of your motel or hotel stay exceeds your policies coverage limits. Your renter’s insurance will only reimburse you for expenses accrued up to your policy limit. Your insurer also won’t pay upfront for your additional living arrangements, instead, you will need to pay and receive reimbursement for the costs.

Related: What does renters insurance cover


Your renter’s insurance will cover most of the financial burden when it comes to damage to your rental unit, including hotel stays. Loss of use coverage only reimburses you if your unit is unlivable due to a covered peril, you don’t exceed your policy limits, and you filed your claim in good faith.

Related: How to file a renters insurance claim

Coverages under your insurer include hotel or motel stays, replacing damaged personal property, liability claims filed against you, and costs associated with relocating like storage units, pet boarding, and groceries. Remember to check your policy regularly if you’re not sure which perils are covered, and make sure your renter’s insurance policy reflects your lifestyle and covers the total value of your belongings.

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