Ordinance or Law Coverage: Rebuilding to Code After a Loss
After a major loss, you don’t rebuild to the old specs—you rebuild to today’s code. The extra cost can be substantial and isn’t fully covered by standard policies. Ordinance or Law (O&L) coverage fills the gap, funding demolition and code‑mandated upgrades.
Keywords integrated: ordinance or law coverage, code upgrades, demolition coverage, rebuild cost, building code compliance, coverage A/B/C.
What Ordinance or Law Actually Covers
- Coverage A: Loss to undamaged portions of the building required to be demolished.
- Coverage B: Demolition and debris removal costs beyond the base policy.
- Coverage C: Increased cost of construction due to code changes.
When You Need It Most
- Older homes in jurisdictions with aggressive code updates.
- Historic districts with material/method requirements.
- Partial losses where undamaged parts must also be brought up to code.
How Much Limit Should You Carry?
Rules of thumb: 10%–50% of Coverage A depending on age, complexity, and local code environment. Contractors and local building officials can estimate typical upgrade costs.
Common Upgrades That Drive Cost
- Structural: shear walls, hurricane clips, foundation bolting.
- Electrical: panel, GFCI/AFCI, grounding.
- Plumbing: venting, materials, seismic strapping for water heaters.
- Energy: insulation values, window ratings, HVAC efficiency.
Claim Strategy and Documentation
- Involve a contractor familiar with code upgrades early.
- Ask your adjuster to separate base repairs from code‑driven items.
- Keep permits, inspection notes, and code citations in a project folder.
FAQs
Is O&L included automatically?
Often a small amount is included; higher limits require an endorsement.
Does O&L apply to wear‑and‑tear code issues?
No—only when triggered by a covered loss.
Does it cover ADA upgrades for rentals?
It can, if mandated by code; check policy language.
Conclusion: Don’t Rebuild Underfunded
Ordinance or Law coverage is the difference between a compliant rebuild and unexpected out‑of‑pocket bills. Choose limits that match your home’s age, local codes, and risk tolerance, and organize documentation from day one of the claim.
Not sure what your city typically requires after a partial loss? Share your property age and location and I’ll help you gauge a suitable O&L limit.
