Guaranteed Replacement Cost—Effect on Other Coverages

The standard HO-3 policy provides coverage for trees and shrubs in the amount of 5 percent of the coverage A limit. How does the addition of a “guaranteed replacement cost” endorsement affect this coverage?

Such an endorsement automatically increases the amount of coverage A in the event of a total loss, if the coverage is inadequate. When the endorsement is used, is the limit for trees and shrubs still 5 percent of the amount on the declarations page or is it 5 percent of the new amount of insurance?

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