News & Announcements

February 25, 2021

Ordinance & Law Coverage

What is it? Do I need it? Do I have it with my Mutual Assurance Society Policy?

What is it?

Ordinance and law coverage provides financial assistance if a home must be brought up to state or municipal codes. This coverage typically applies if you have a covered loss and the city or state requires you to upgrade your property to meet the newest building codes.

As an example, let’s say your older home sustains extensive water damage, and in the repair process, you find your plumbing is not up to code. Partially damaged homes that are required to be brought up to new codes are fully covered under ordinance and law coverage, subject to the dwelling limit of insurance. Standard policies only provide coverage for the cost to repair or replace with like-kind and quality materials, which may not be up to code. In other words, standard policies would not cover any additional costs for the necessary upgrades.

Another example might be if your home is more than 50% damaged in a fire and doesn’t meet code.  In this case, the municipality may require you to tear down your home entirely and rebuild it to code.  Ordinance or law coverage will pay to demolish the remaining home as well as build it back in compliance with the latest building codes, subject to the dwelling value on your policy.

This is another reason why it’s so important to insure your home to its full replacement cost value.  A total loss, including demolition and clean up, can easily exceed the value of your home today.

Do I need it?

New local ordinances can be passed at any time, particularly if you live in an area subject to severe storms,  and if you live in an older home, having this additional coverage is worth it for your peace of mind.

Do I have it with Mutual Assurance Society?

Most policies with other insurance providers have a $10,000 ordinance and law limit. With Mutual Assurance, however, you are all set.

“Yes, ordinance and law coverage is automatically included, and no separate cost limit applies. The dwelling limit on the homeowner policy should be high enough to contemplate these potential additional costs,” according to Lisa Eckart, Manager of Underwriting Services for Mutual Assurance.

If you have any questions about your coverage, please contact your Member Services representative.