If you own a commercial building and lease it to tenants who run their own businesses, your insurance needs are different from theirs. You’re responsible for the building, the parking lot and the common areas. Your tenants are responsible for their own operations. A lessor’s risk policy is built for that arrangement, and the lease is what ties the two sides together.

This page explains, as education, what owners of leased retail, office, warehouse and medical buildings in North Central and Northeast Florida should understand about lessor’s risk insurance. It doesn’t cover apartments or condominium and homeowner associations.

What landlords deal with day to day

  • Slip-and-fall and parking lot claims. Visitors hurt in common areas, sidewalks or parking lots you control.
  • Tenant operations. A tenant’s business can create risk at your building, even though the tenant runs it.
  • Wind and flood. Florida buildings face hurricane wind and flood exposure, and windstorm deductibles can be large.
  • Vacancy. Empty units or buildings can affect your coverage under many property policies.
  • Loss of rent. If a covered loss makes the building unusable, rent stops but your mortgage doesn’t.
  • Building code upgrades. Rebuilding after a loss may require bringing the building up to current code.

Typical claims for landlords

Without quoting statistics, lessor’s risk claims usually involve injuries in parking lots and common areas, water and wind damage to the building, and disputes over whether the landlord or the tenant was responsible for a condition. Many of these turn on what the lease says about maintenance and insurance.

Coverage at a glance

Coverage Why it matters here Learn more
Lessor’s risk general liability Injuries and damage in areas you control, like parking lots, sidewalks and common areas General liability
Commercial property The building itself against fire, wind and other covered losses Business insurance
Loss of rents (business income for landlords) Rent you lose while a covered loss is being repaired Ask us about loss of rents
Ordinance or law Code-related costs after a covered loss, such as tearing down the undamaged part of the building, demolition and the extra cost of rebuilding to current code. It’s usually added to the policy with its own limits. Ask us about ordinance or law
Flood Flood damage, which property policies usually exclude FloodSmart
Commercial umbrella Extra liability limits above general liability Umbrella

Your leases and insurance, in plain words

The lease decides who insures what. Before you sign or renew a lease, read the insurance, indemnity and maintenance sections together. These are the terms to look for:

  • Tenant insurance requirements. Minimum general liability limits for the tenant, and often property coverage for their contents and improvements.
  • Additional insured. The lease asks the tenant to add you to its general liability policy as an additional insured. That can cover you for some claims tied to the tenant’s space or business, but only as far as the endorsement’s wording allows, and often only up to the limits the lease requires. Ask for a copy of the endorsement, because a certificate alone doesn’t give you coverage.
  • Waiver of subrogation. Landlord and tenant agree that their insurance companies won’t go after each other after a loss. It usually needs an endorsement on both sides.
  • Maintenance responsibility. Who maintains the roof, parking lot, HVAC and common areas, which often decides who’s responsible when someone gets hurt.
  • Tenant improvements. Who insures build-outs: the tenant who paid for them or the landlord who owns the building.

Collecting tenant certificates

Ask each tenant for a certificate of insurance at move-in and every year at their renewal. A certificate is for information only. It doesn’t change or add coverage, which is why it’s worth also asking for the additional insured endorsement. Keep a list of tenant expiration dates so you know when a certificate goes stale.

Workers’ comp for landlords

If you have employees, such as a maintenance person or property manager, Florida’s general rule requires workers’ comp once you have four or more employees, full- or part-time, counting corporate officers or LLC members who haven’t filed an exemption. If your own staff do construction work, such as renovations or build-outs, the one-employee construction rule can apply. If you hire contractors for repairs, collect their certificates, because an uninsured contractor’s injury can still become your problem.

Florida rules that affect landlords

Florida’s landlord and tenant law for nonresidential tenancies is in Part I of Chapter 83 of the Florida Statutes. It covers things like rent payment and the landlord’s remedies. Most insurance terms come from the lease, not the statute, so the lease is where the work is.

Flood damage is usually excluded from commercial property policies. National Flood Insurance Program policies have building limits, and lenders may require more. Private and excess flood options exist.

Practical risk management steps

  • Inspect parking lots, sidewalks and lighting on a schedule and keep a log
  • Fix trip hazards quickly and document the repair
  • Collect tenant certificates and endorsements and track their expiration dates
  • Keep roof, wind mitigation and building system records in one place
  • Know your windstorm deductible in dollars, not just as a percentage
  • Tell us right away if a building or a large unit will be vacant

Questions to ask before you renew

  • Does my property limit reflect what it would cost to rebuild today?
  • What is my windstorm deductible in dollars?
  • Do I have loss of rents, and for how many months?
  • Do I have ordinance or law coverage?
  • Does my policy have a vacancy condition that could affect me?
  • Are my tenants’ certificates and endorsements current?
  • Do I need flood coverage, or more of it?

Frequently asked questions

What is lessor’s risk insurance?

It’s general liability, and often property coverage, for owners who lease commercial buildings to tenants who run their own businesses. It’s built for areas the landlord controls, like parking lots and common areas.

Should my tenants name me as an additional insured?

Many commercial leases require it. Being an additional insured can give you coverage under the tenant’s policy for some claims that come from the tenant’s space or business. What’s covered depends on the endorsement, so ask for a copy of it, not just the certificate.

What is a waiver of subrogation in a lease?

It’s an agreement that the landlord’s and tenant’s insurance companies won’t try to recover from each other after a loss.

Does my property policy cover flood?

Usually not. Flood is normally covered separately, through the National Flood Insurance Program or private flood insurance.

What happens if my building is vacant?

Many property policies limit coverage if a building is vacant for a set period. Tell us if a building or large unit will be empty.

What is loss of rents coverage?

It can replace rent you lose while a covered loss is being repaired, up to the policy’s limit and time period.

Does this page cover apartments or condo associations?

No. Apartments are on our apartment insurance page, and this page doesn’t address condominium or homeowner associations.

Sources

General information, not legal or coverage advice. Coverage depends on the policy issued, its terms and underwriting, and contract requirements depend on the contract you sign. Check licensing and safety rules with the agency that enforces them.

McGriff-Williams Insurance is an independent insurance agency in Gainesville, in business since 1983 and licensed in Florida. We’re at 3501 W University Ave, Gainesville, FL 32607. Questions: (352) 371-7977, Monday to Friday, 9 a.m. to 5 p.m.

Last updated October 31, 2026