Ordinance or Law Coverage in Home Insurance

Kenny thought the worst was over. A small kitchen fire had charred part of the wall and melted some wiring. His home insurance adjuster gave him the go-ahead for repairs, and a contractor came out with a plan to patch things up. But then the city inspector showed up.
“You’ll need to upgrade your electrical panel to meet the current code,” the inspector said.
Kenny blinked. “But the fire didn’t even touch that part of the house.”
“Doesn’t matter,” the inspector said. “You’re making repairs, and that triggers code compliance for the whole system.”
The repair estimate jumped by several thousand dollars—and Kenny’s insurance didn’t cover it.
Why? Because he didn’t have ordinance or law coverage.

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​What Is Ordinance or Law Coverage?

Most standard home insurance policies are designed to pay for damage caused by a covered peril—like fire, wind, or hail—based on the home’s existing structure. But what happens if your house doesn’t meet current building codes, and you’re forced to update it during repairs?
That’s where ordinance or law coverage comes in. It helps pay the extra cost of repairing or rebuilding your home to meet local building codes that have changed since your home was built.

Why Does This Matter in Oklahoma City?

Oklahoma City is full of homes built decades ago—many in neighborhoods with aging electrical systems, outdated plumbing, and older construction methods. If your home was built in the 1970s or earlier, there’s a good chance parts of it don’t meet today’s codes.
Let’s say your roof gets damaged in a windstorm. During the repair process, a city inspector may require you to bring attic ventilation or structural reinforcements up to code—even if those things weren’t damaged. And guess who pays if your policy doesn’t include ordinance or law coverage? You do.

What Does Ordinance or Law Coverage Help Pay For?

This coverage kicks in when code compliance makes your repair job more expensive. It can also help with partial losses that trigger updates to undamaged areas of your home.
Here’s what it typically helps cover:
1. Demolition CostsIf part of your home must be torn down to rebuild correctly, ordinance or law coverage can help cover the cost to demolish undamaged portions that have to be removed.
2. Increased Construction CostsBringing your home up to current electrical, plumbing, or structural codes may require more expensive materials or labor than a simple patch job.
3. Required UpgradesCity inspectors might require upgrades to things like:

• Electrical panels
  
• HVAC systems
  
• Smoke detectors
  
• Fire-resistant building materials
  
• Window egress in older bedrooms
  

None of these may have been damaged—but if you’re required to update them as part of the repair process, your standard home insurance probably won’t pay for it.

What Ordinance or Law Coverage Does Not Cover

While it’s helpful, this coverage doesn’t apply in every situation. Here’s where it stops short:

• Voluntary upgrades: If you just want to modernize your home, this won’t apply.
  
• Old code issues not triggered by damage: If your house has outdated wiring but nothing gets damaged, this coverage doesn’t kick in just because the inspector notices it.
  
• Entire home tear-downs (unless required by law): You’ll need to check your policy wording carefully here.
  

​Real-World Scenarios Where This Matters

Let’s break it down with some common examples:
Scenario 1: Partial Fire LossA fire damages one room, but the city requires upgraded wiring throughout the home. Ordinance or law coverage helps pay for the new wiring system.
Scenario 2: Windstorm Roof DamageNew code requires added structural reinforcements in the attic, even though the original ones were technically fine. Your policy helps pay for the extras.
Scenario 3: Plumbing Repairs After a LeakA pipe bursts, and the city says you need to replace all galvanized plumbing with PEX. This coverage helps cover the gap between the old system and the new one.

How Much Does Ordinance or Law Coverage Cost?

The good news? It’s often inexpensive to add. Many policies offer it as an endorsement, and it typically costs just a few dollars per month. You can choose from several limits, such as:

• 10% of your dwelling coverage (common default)
  
• 25%
  
• 50%
  
• Or higher, depending on your home’s age and size
  

For example, if your dwelling coverage is $300,000 and you have a 25% ordinance or law endorsement, you’d have $75,000 available for code-compliance upgrades.

​Why You Shouldn’t Overlook This in Oklahoma

Oklahoma is no stranger to weather events—windstorms, hail, lightning, and tornadoes keep insurance companies busy. But the rebuild process is where many homeowners get surprised.
Even a small claim can open the door to a larger compliance issue. And without this coverage, you may be stuck covering thousands in upgrades just to pass inspection.

How to Find Out If You’re Covered

Don’t wait until you’re knee-deep in a repair project to find out you don’t have this endorsement. Here’s what to do:

1. Review your home insurance policy. Look for a section labeled “Ordinance or Law Coverage” or “Code Upgrade Coverage.”
   
2. Check the limit. If your policy includes it, see whether it’s 10%, 25%, or more. You may want to increase it.
   
3. Talk to an insurance advisor. A quick call can help you understand your exposure and what coverage makes sense for your specific home.
   

​Code Compliance Costs More Than You Think

The cost of building materials and labor isn’t going down anytime soon—and neither are the rules. Cities like Oklahoma City update their codes every few years. That means every year that passes, the gap between your current home and code-compliant repairs gets wider.
At Oklahoma Insurance Professionals, we help homeowners in Oklahoma City and the surrounding areas find coverage that actually works—not just in theory, but in real-world situations. We’re an independent insurance agency, which means we shop across companies to help you get what you need—without upselling what you don’t.
Call us today to review your home policy and make sure you’re protected when the unexpected happens—no code surprises, no hidden costs.

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Scott Godwin
Founder

Oklahoma Insurance Professionals LLC serves Oklahoma City and the surrounding Oklahoma communities by protecting the people we work with just like we protect our own family members. Home insurance, auto insurance, business insurance, and more. We can help you find the coverage you need. ​