Ordinance or Law Coverage?

In reviewing your policy you probably have seen the above term, "Ordinance or Law Coverage" and probably didn't pay much attention, believing it to be just another of those insurance terms stuck in to your policy having no real impact upon you and your coverage. It might be important for you to pay attention to this coverage and how it impacts you. Ordinance or Law Coverage protects against the increased loss incurred by the insured due to the enforcement of building, zoning, or land use laws. Such costs could include changes to comply with the Americans with Disabilities Act (ADA), new earthquake reinforcement requirements, or new life safety requirements. This coverage would most likely be of greater importance to those business owners that own their own building. This coverage can be broken down into four parts - Demolition Cost - Pays the cost to demolish and clear undamaged parts of the property due to enforcement of building, zoning, or land use laws; Loss of the undamaged part - Pays the value of the undamaged part of the building that must be replaced if the building ordinance requires complete demolition and reconstruction; Increased cost of construction - Pays the increased cost to include the required building upgrades to comply with current building codes; and Increased period of restoration - Pays the loss of income during the increased time to rebuild, caused by enforcement of building ordinances, zoning, or land use laws. Next time it might be prudent to review this coverage in detail with your agent to ensure you are properly covered.

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