What is Ordinance or Law Coverage?
Insurance glossary entry on BeCovered.ai for the term "Ordinance or Law Coverage": Pays extra to rebuild to current building codes after a covered loss. Scope: plain-language meaning for coverage discussions; confirm definitions on your policy forms.
Pays extra to rebuild to current building codes after a covered loss.
Understanding Ordinance or Law Coverage
Standard policies may not fully pay code upgrades (wiring, elevation, sprinklers). Ordinance/law endorsements are critical for older homes in strict jurisdictions.
Examples
- Post-fire rebuild requires new energy code insulation—10% ordinance endorsement tapped.
- Roof replacement triggers full deck re-nailing per code—added cost covered if endorsed.
Common Questions About Ordinance or Law Coverage
How much ordinance coverage do I need?
Ask local builders about typical code upgrade deltas for your vintage home—25% endorsements exist in many markets.
Does it apply without a total loss?
Sometimes partial losses trigger code upgrades—policy % limits still apply.
Related Insurance Types
Related Terms
Replacement Cost
The amount needed to replace damaged or lost property with new items of similar kind and quality.
Actual Cash Value (ACV)
The value of property at the time of loss, calculated as replacement cost minus depreciation.
Coverage Limit
The maximum amount your insurance company will pay for a covered claim.
Exclusion
Specific situations, conditions, or types of damage that your insurance policy does not cover.