Commercial Tenant Insurance

Commercial Tenant Insurance

If your business is looking for a new place to set up shop and your prospective landlord has spoken to you about purchasing commercial general liability (CGL) insurance and/or commercial tenant insurance, or if you’re looking for a new commercial tenant insurance policy, we’ve provided the facts you need to make an informed decision. 

Commercial tenant insurance, contains a key coverage known as tenant legal liability insurance, that can and typically should be be included as part of a commercial general liability insurance policy. Tenants legal liability insurance can cover damage you or your employees may cause to the unit and/or building you rent or lease. Combined with the numerous other coverages you get from your commercial general liability policy, commercial tenant insurance can protect your business, your customers, the general public and your landlord (or the property owner) and their building as well. 

Why your Landlord May Require Commercial Tenant Insurance Before a Lease is Signed

First and foremost, landlords and commercial property owners want to know that their property is protected and that if damaged, or a total loss occurs, costs to repair the damage or coverage to the full replacement value of the property can be covered by the tenant’s insurance policy. Think about the expense that would be incurred if, for example, a toaster oven is accidentally left on in the break room and starts a fire that causes structural damage to the property. Few businesses can afford to pay for the damage to a commercial property that even the smallest of accidents can cause. 

Secondly, your landlord or the property owner, who owe a duty of care to the general public, do not want the potential liability if someone is injured while in your unit. Because commercial tenant insurance is part of a commercial general liability policy, they know that your CGL policy can cover personal injury claims – among other liability claims.

What else does Commercial Tenant Insurance Cover?

If you or one of your staff does cause damage to your commercial unit and/or other property in the vicinity (that originated in your unit), your commercial tenant Insurance can cover:

  • Costs to repair damage to your unit and other property
  • Legal costs to defend a lawsuit including lawyer’s fees 
  • Costs to settle a lawsuit brought against your business
  • Damages awarded against your company

Alongside your commercial tenant insurance coverage, your commercial general liability policy can cover medical expenses for injuries to third parties and third-party property damage caused by your products, services and business practices as well as legal coverage for:

  • Personal injury lawsuits
  • Property damage lawsuits 
  • Claims of false advertising.
  • Claims of libel and/or slander

What’s not covered by a Commercial Tenant Policy?

Neither your CGL policy nor your commercial tenant insurance covers your business assets or the contents within your commercial unit. That means that your:

  • Upgrades and renovations done to your unit
  • Machinery, equipment and tools
  • Office equipment such as phones, computers, tablets
  • Office supplies
  • Furniture, desks, filing cabinets
  • Stock or inventory
  • Cash, financial instruments and other assets
  • Business records

are not protected if your unit experiences a peril like a fire, flood, sewage backup, windstorm theft, vandalism or others. Your landlord’s insurance will also not cover your assets after a peril which is why your business needs a Commercial Property Insurance policy to protect the contents within your unit (and can include optional coverage for when your property is in transit as well).

How much does a Commercial Tenant Insurance Policy Cost?

The cost of a commercial tenant insurance policy will depend on a few factors including:

  • The type of work you do
  • Where your business is located
  • The size of your workspace
  • The number of years you’ve been in business
  • Gross revenue and other financial information
  • Previous insurance claims

There may be other factors that come into play when determining your commercial tenant insurance premiums.

Get ALIGNED with a Broker who Specializes in Insurance for Businesses

Commercial insurance is all we do. When you choose ALIGNED, you get a commercial insurance specialist advocating for you. Our job is to get your commercial tenant insurance from Canada’s top insurance companies at rates you can afford.

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