The Importance of Law and Ordinance Coverage

house-damageLaw and Ordinance Coverage: Hurricane Andrew and the $30 billion price tag it left behind forever changed Florida, and the changes put into place statewide following the storm have had a big impact on your home insurance policy. For many years, Florida’s reaction to hurricane damage was just to clear the mess and rebuild. But after such a costly storm tore through South Florida in 1992, that mindset wasn’t good for homeowners or insurance companies moving forward.

The most stringent building codes in the country were put into place in South Florida, but not anywhere else the state. That changed as of March 1, 2002, when the State of Florida implemented the Unified Florida Building Code, which meant that effective from that date, all new houses would have to be built to these stringent standards.

But what did that mean for houses built before 2002? Hurricane damage or other damage sustained after the Unified Building Code went into effect often resulted in costly, extensive repairs to get the older homes up to code, and those costs weren’t covered by home insurance policies.

That too changed in 2005 when new legislation mandated that insurance companies had to offer “law and ordinance coverage,” which helps pay for the costs of bringing a home built before 2002 up to the Unified Building Code, and give the insured the opportunity to accept or refuse the coverage. Law and ordinance coverage is either 25 or 50 percent of the amount of coverage you have on the property, depending what you choose.

As building codes are constantly changing – to better protect us from a hurricane – it’s important to have law and ordinance coverage, especially if your home was built before 2002. Not only will it give you peace of mind, but it can save you a lot of money if your home is ever damaged.

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