If you’re a tenant, you might believe that you have avoided many loss exposures, such as fire damage to the structure, associated with owning the building. However, have you read your lease lately? Really read it?
Many leases contain extensive insurance requirements that the tenant (you) must agree to meet. Although these usually include liability from your actions and responsibility for covering your property for loss, it’s easy to overlook the extent to which you might have agreed to cover exposures usually assumed to be the responsibility of the building owner.
For example, retail shopping areas often have an abundance of external glass windows. Although these are clearly the property of the building owner, many leases transfer any responsibility for damage to the windows to the tenant. The idea is that because you directly control the potential loss exposures for the glass (such as vandalism, accidental breakage, and maintenance inspections), you should provide the insurance. Similar reasoning might lead you to being held responsible under the lease for other losses not directly attributable to your own negligence.
Now is the time to pull out that copy of your lease. Review it with your legal counsel to see if there might be language or agreements that need addressing. Then let us review the document for its insurance implications (be forewarned — they won’t all be contained in a paragraph titled “insurance”). We’ll sit down with you to review what your lease requires, how your current insurance program matches up with these requirements, and then offer guidelines for making any necessary changes to your protection.