Mother displaced by fire… ‘renting’ to her while she lives with me Shawn Valloric asked 3 months ago
Mother displaced by fire… ‘renting’ to her while she lives with me

My mother’s house caught fire and she is now displaced from her house. She is now living with me temporarily. I was advised by the agent and the adjuster that with her “loss of use” I should charge her rent to cover the amount my expenses will go up since the insurance company would be paying all this if she rented a home if I didn’t have any room.

I was advised by the adjuster to make sure what I charge her covers “a lot” more than her costs she reported for her utilities (i.e. if she said her utilities were $500/mo. I shouldn’t “just” charge her $550.) He suggested a number in the $1000-$1500 range.

1 Answers
Josh Engle Josh Engle Expert answered 1 month ago

It is not uncommon for a policyholder to stay with friends or family rather than seeking other temporary rental accommodations. This is often a better option for both the insurance carrier and the policyholder. The insurance carrier usually stands to benefit from substantial costs savings versus having to pay for a temporary apartment or home, temporary furnishings for that home, etc. Those costs can run thousands of dollars per month. The obvious benefit for the policyholder is that they can stay with someone they know, and usually in an area they are familiar with. This can offer some comfort in an otherwise high-stress situation. There should be an agreement reached with the carrier as to what the fair monthly charge will be for rent, additional utilities, etc. As would be advisable for any agreements reached regarding the claim, you should document this agreement with the carrier in writing (a follow up email, letter, etc.). The carrier may request a simple lease agreement be drafted, but this should be confirmed with the carrier. The carrier may also request the social security number of the “landlord” as these payments would likely be considered taxable income.