Your commercial lease likely has specific insurance requirements - and failure to maintain proper coverage could put your tenancy at risk. Understanding what your landlord requires and how to meet those requirements efficiently is essential for any restaurant tenant.
Common Lease Insurance Requirements
- General liability: Typically $1-2 million per occurrence
- Property insurance: Coverage for your tenant improvements and equipment
- Workers' compensation: State-required coverage for employees
- Liquor liability: Required if you serve alcohol
- Business interruption: Some landlords require this coverage
Additional Insured Requirements
Almost every commercial lease requires you to add the landlord as an 'additional insured' on your liability policies. This means:
- The landlord is covered under your policy for claims arising from your operations
- You need to provide certificates of insurance (COIs) with proper endorsements
- Annual renewal certificates are typically required
- Landlord may require 30-day notice of cancellation
Waiver of Subrogation
Many leases require 'waiver of subrogation' on your property insurance. This prevents your insurer from suing the landlord after paying a claim - even if the landlord was partially at fault.
Frequently Asked Questions
What if my coverage doesn't meet lease requirements?
You may be in breach of your lease. Most landlords will give you time to remedy, but repeated failures could result in lease termination. Review requirements annually.