Homeowners Policy (HO)Question 341 of 474
Coverage A is $250,000 and a rebuild after a covered fire must meet a newer building code, raising the cost. The ordinance or law additional coverage on a standard form provides up to:
a.$12,500, being 5% of A
b.$25,000, being 10% of A
c.$250,000, the full limit
d.$2,500, a flat sublimit
Explanation
Ordinance or law is an additional coverage of up to 10% of the Coverage A limit for the increased cost of construction needed to meet a code when repairing covered damage, and 10% of $250,000 is $25,000. The 5% figure is the trees, shrubs and plants aggregate. The $2,500 figure is a Coverage C special limit, not a rebuilding allowance.
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