Why Your Commercial Lease Requires Liability Insurance
When you lease commercial property for your business, there is a very good chance that your landlord is going to require you to carry business liability insurance for protection. If you do not have business liability insurance then it is a good idea to get some for your daily business operations. But why would your commercial landlord care if you have liability insurance or not?
Protection Against Your Business Operations
As an example, let’s say that your business manufacturers caustic chemicals. One day, the measures you have in place to make sure those chemicals do not damage your facility fail and suddenly your landlord has tens of thousands of dollars in damage to try and cover. Business liability insurance with your landlord on the policy will protect your leased property from these kinds of damages.
Your landlord may ask for an extra deposit if your business contains obvious risks to the property, but those deposits may not be enough to cover real damages. A business liability policy is going to cover the damage and prevent you and your landlord from losing a lot of money.
Business Is Naturally Risky
Business liability insurance is going to protect your landlord from those unexpected setbacks that might prevent you from being able to pay your rent. For example, if you suddenly have half of your fleet of vehicles in need of major repairs, then that would probably drain your cash flow for the month. If you have to make a payment late, it is going to be your property rent and not your payroll.
When you have business liability insurance in place, you and your landlord will be protected from those unexpected moments when cash might be light. This not only protects your landlord, but it is also a great way to protect your business as well.
Stoppages In Business
Some landlords my require business liability insurance to protect against those times when business has to stop and the stop is not scheduled. If the building catches on fire and damages a considerably part of the business, then the landlord is at serious risk of not getting their rent. Business liability insurance with the landlord names as additional insured can help protect against these unexpected stoppages that can often have long-lasting effects if they are not handled properly.
Our business experts can give you a complete rundown on the types of insurance you will need to protect your business and give your property landlord peace of mind. Without the proper type of insurance to protect your business, you could be inviting financial disaster. But when you have all of the right kind of protection in place, then you are making smart business decisions that will keep your company operating for many years to come.