Have you ever stopped to think about how the insurance industry creates jobs and pushes other industries to thrive? To illustrate what I mean, it may be best to go back in time a bit.
In 1752, the Philadelphia Contributionship for the Insurance of Houses from Loss by Fire was founded by Benjamin Franklin. It’s a mouthful, so it came to be known as the Contributorship.
Franklin was a forward-thinking man, of course and the Contributorship was not about to insure a house if it was not “up to code” if that was even a thing in 1752. So Franklin and his associates retained the services of a chimney sweep and paid them to service the homes of insureds. Of course, today the responsibility to find those services falls in the lap of the insured, but countless service providers like those chimney sweeps are still kept busy making sure insureds are up to code.
To have a home or building insured, today there are a great many codes that one must meet – either mandated by the state for building permits to be issued in the first place, or mandated by the insurance company before it will insure a property. Regardless, each one of these mandates provides someone with a job to do and adds to the economy on any level. Fire extinguishers, sprinkler systems, updated electrical wiring, plumbing, roofing, siding, security systems all may be needed.
Of course, these are all things that should be up-to-date in any safe structure. Some of these things may seem like a real pain. And, sure, they can be. The good news is that building code coverage can be added to most home or commercial building policies. It’s optional but it will pay off, should you ever be forced to rebuild.
NOTE: Building code coverage does not typically cover a routine maintenance or remodeling project.
Building code coverage helps with expenses for the updates on electrical, heating, ventilating, and air-conditioning, plumbing, roofing, and fencing incurred due to the enforcement of code laws, if the building in its original state was not up to code.
If your local building codes require a building to be demolished entirely and rebuilt, then your basic property insurance will either cover to a limited extent, or may not cover at all, the replacement of the heretofore undamaged portion of the structure, or the cost of its demolition.
Building code coverage will.
As for the part of the structure that was damaged in the calamity in question, your regular insurance will cover the rebuilding of the damaged structure itself up to its original state. Then, so long as it was damaged by a type of peril covered by the policy, building code coverage covers the costs of getting it up to code if laws changed since the structure was originally insured.
Something to think about the next time you insure your home or business.