What is ordinance or law coverage?
Insurance companies may offer optional building code insurance coverage, also called "ordinance or law coverage," which can help cover the cost of bringing your home up to code if it's damaged by a covered peril. Local building codes may mandate upgrades or changes that weren't required when your home was originally built. A standard homeowners insurance policy typically won't pay to bring your home up to code.
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How does ordinance or law coverage work?
An ordinance is a law or regulation enacted by a municipality or county government, created to address matters of local concern not covered by state or federal laws, such as zoning regulations. You may need to bring a home up to code based on an ordinance, which means your city or local government requires home repairs to align with modern building codes.
Building code upgrade coverage, also referred to as ordinance or law coverage, may pay for the additional costs you incur during the construction, demolition, or repair of a damaged covered structure due to changes in laws and regulations. If a covered peril causes damage to your home, building code coverage can pay for the repairs needed to bring your home back up to code, up to your coverage limit. A standard homeowners insurance policy may not offer this coverage.
When do you need building code protection?
Building code insurance coverage or ordinance or law coverage may be pertinent if you live in an older home that hasn't been updated to bring it up to the latest building codes. It's important to be aware of your city's building code requirements, especially for an older home. If you have a covered loss and the repairs require additional work to bring it up to code, you may be stuck paying out of pocket for the additional costs if you don't have this coverage.
What doesn't building code coverage cover?
Renovations, remodels, or routine maintenance likely won't be covered by building code insurance coverage. Suppose you're replacing your roof and discover you need to make structural changes to bring it up to code. In this case, the cost of bringing the roof up to code is your responsibility.
How can you tell if your home isn't up to code?
Consider contacting your local building inspection office or having your home inspected by a licensed professional or city inspector to determine if your home meets the current codes in your area.
Is there a coverage limit with ordinance or law coverage?
A building code coverage limit is typically some percentage – such as 10% or 25% -- of your dwelling coverage.
For example: if your dwelling coverage is $200,000 and you have a 10% ordinance or law policy, you may receive up to $20,000 to pay for any required upgrades as a result of a covered peril.
How do you get ordinance or law coverage?
Ask your agent or homeowners insurance company if they offer ordinance or law coverage. If it's available, it may be added as an endorsement or additional coverage to your existing homeowners policy.
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