How much of the increased cost of repair will the Ordinance or Law provision cover under Coverage A?

The Ordinance or Law provision under Coverage A is designed to cover the increased costs associated with repairing or rebuilding a structure to comply with current building codes or ordinances following a loss. This provision specifically limits the coverage for such additional expenses to a specified percentage of the Coverage A limit.

In this case, the correct answer signifies that the Ordinance or Law provision offers coverage for up to 10% of the Coverage A limit. This means that if a policyholder experiences a covered loss and the repairs or rebuilding require adherence to new building codes that were not in effect when the original structure was constructed, the insurer will provide an additional 10% of the Coverage A limit to cover those costs.

This percentage is particularly relevant for policyholders to understand, as it sets a boundary on the additional funds available for compliance with laws and ordinances, which can significantly impact the overall cost of repairs. Understanding this limit is crucial for both agents and policyholders in planning for potential out-of-pocket expenses following a loss.