February 14

What is Ordinance or Law Coverage?


Ordinance or Law Coverage

More than likely, less than one in ten homeowners could explain what this valuable coverage is. Most insurance policies will make this coverage part of the standard coverage, but with a limit that may not be practical.

Ordinance of Law Coverage is triggered when, after a major claim, the cost of repairing or replacing your home is increased significantly by changes to the building code in your area. These code changes can also affect homeowners who live in older historic houses.

If, for example, your 100-year-old home sustains major damage from a covered peril, the contractor is more than likely going to discover significant code changes that must be dealt with while repairing or rebuilding your home.

Even changes that may be considered small can affect the cost to repair or rebuild, and this is where the Ordinance of Law Coverage becomes a life saver. For example, your circa 1900 home has some major fire damage that has affected a small portion of the roof. Since your home is in Brandon, Florida, your contractor is going to find that he must now install hurricane straps and larger roofing nails for the entire roof, not just the damaged portion. This will undoubtedly increase your repair costs significantly and if your policy does not contain sufficient limits of an Ordinance or Law Coverage; you’re paying the additional costs out of pocket.

This scenario is the same for commercial buildings as well. Older commercial building owners will need to make certain they discuss this coverage with their agent and endorse sufficient limits for Ordinance or Law Coverage onto their policy.

Every homeowner that is living in an older home or a home in a hurricane state should discuss this coverage to make certain they have adequate limits of coverage in their policy.


home insurance, homeowner's insurance, ordinance or law

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This blog may provide a brief overview of the terms and phrases used within the insurance industry. Please read your official policy for full details about coverages. These definitions do not alter or modify the terms of any insurance contract. If there is any conflict between these definitions and the provisions of the applicable insurance policy, the terms of the policy control.