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  • Beth Pariseau

Law & Ordinance Coverage

What is Law & Ordinance Coverage?

You may have heard the terms "law and ordinance" or "code coverage" in relation to your insurance policy, but what does it mean? Law & ordinance (L&O) is an optional coverage provided by your insurance carrier that ensures your home will be repaired not only to it's pre-loss condition but also to include any upgrades that are required to meet the most up to date building code in your area.


Do I need Law & Ordinance Coverage?

Unless it's specifically required in your state, law & ordinance coverage is optional, meaning you can choose whether or not to add it to your homeowners insurance policy. Costs can quickly add up if you need to rebuild your home and follow new local building codes, especially if you live in an older home. Law & ordinance coverage ensures that you don’t have to pay these costs out of pocket.


What does Law & Ordinance cover?
  • Required upgrades - provides coverage for any increased costs of making sure your home complies with new building codes when you have to rebuild. Building codes are reviewed and updated every 3 years, if you have not had any repairs made to your home in the last 3 years, chances are building code requirements have changed and there will be a required upgrade for your loss.

  • Undamaged portion of the building - provides coverage for the undamaged portion of the insured building when a partial loss occurs.

  • Demolition - Covers the costs of demolition and debris removal if a building code requires you to demolish your home due to partial loss usually associated with large loss


What effect does not having ordinance or law have on a claim?

A standard replacement cost policy will pay to replace new for what is existing and damaged, and will not cover the additional costs of complying with local building codes. Paying out of pocket for code upgrades can be expensive and often times resulting in added expenses the homeowner was not aware of or may not have planned for.


Law & Ordinance doesn’t pay the costs of getting your home up to code after a renovation or routine maintenance. This coverage only applies to a covered loss (wind, hail, fire, etc.). In short, having law & ordinance coverage could save a homeowner thousands of dollars during a repair from a covered loss and is an important coverage to any property insurance policy. If you have any questions regarding the importance, purpose, or necessary amount of coverage, please contact your insurance agent for more information.

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