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Q: What type of insurance is needed on leased commercial property?
  • The best answer to this question is from an insurance agent that is familiar with commercial lines and is experienced in helping businesses insure against the unexpected. Some items that should be discussed are the insurance of the fixtures and improvements. A landlord's insurance might not cover a tenant's loss of fixtures and improvements to the property. A competent agent will want to review your lease. A close reading of the lease might reveal other items that need coverage that might not be obvious. For example, the tenant could be responsible for the HVAC units on the roof of a building they rent. If these are lost due to theft or fire, the tenant could be responsible for their replacement.



    Other coverages that might be appropriate are loss of income, machinery, furniture, inventory, computer data (replacing a computer doesn't replace the data), equipment that is leased and not owned, records and documents, liability coverage, and on and on. This is why an experienced agent is so important. Only a well-versed commercial agent can take stock of your business's needs and recommend the appropriate coverage. One clue as to their expertise will be if they just offer you a boilerplate policy or if they take the time to sit down with you to thoroughly understand your business and its needs.


    Answer Submitted on Sun, Jan 18 2009

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    Answer Contributed by: Harlan Cooper
    Honesty - Integrity - Experience. Helping homeowners make informed decisions about their home financing for over 25 years. Serving all of Texas. 972-572-5600 Toll-free 1-866-458-5600
  • It is recommended that you determine your insurance requirements based off of your business needs rather than the minimum to satisfy a commercial lease.  In addition, commercial leases, and the included insurance stipulations, vary significantly.  They generally take into account the intended use, property types and other risk that either their property possess or that of the intended lessee.  For example, the use of an office by an accountant has considerably less risk than the lease of a space to a bar or night club.  Not to mention the businesses have different intrinsic risk all together.  With that said, the common Commercial General Liability policy should be sufficient to satisfy the standard office and retail commercial leases.  Consult your local Commercial Realtor then your personal insurance agent. 


    Answer Submitted on Sun, Jan 18 2009

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    Answer Contributed by: Ryan Hasselmeier
    Advisors Group International Inc
    PO Box 8368
    The Woodlands TX 77387
    (888)299-9965
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