For homeowners, Extended Replacement cost coverage is golden, but another coverage option that is IMPORTANT and sometimes OVERLOOKED is Building Code Upgrade coverage.
Also known as Ordinance and Law Coverage, Building Code Upgrade coverage is an important endorsement that covers the additional costs to repair damage or replace a home in the event of a claim. Older homes that are damaged may need upgraded electrical, heating, or plumbing based on city codes. These costs may be excluded by your policy unless you have this endorsement included for this specific coverage.
An example of how Building Code Upgrade coverage works is let’s say in a windstorm, an old tree falls on your roof and into your living room. In order to repair or replace the damaged structure, the city requires that the building be updated to meet current codes as a condition of rebuilding. You would be required to install costly repairs in order to meet the current building codes. Even homeowners of newer homes face the same concerns–just because your home is newly built does not mean that city codes freeze.
If your current policy doesn’t have this valuable endorsement to address this coverage gap, you will be responsible for the additional costs out of your own pocket. You can select Building Code Upgrade limits of 10, 25 or 50 percent of your Coverage A Dwelling limit. For example, if the Dwelling amount on your home is $200,000 the 10% option will allow up to $20,000 in upgrades due to building code requirements.
For just a few dollars, you can add the Building Code Upgrade endorsement to your policy and save yourself significant costs to your repair bill in the event of a claim.
Call our office at 209-223-5700 for a free review of your homeowner policy.