Commercial Liability Insurance Required For Tenants

Businesswoman signing NYC office lease contract with real estate agent

Insurance and liability requirements are part of the many complex issues that will be dealt with under your commercial lease. While negotiating lease terms for New York City office space will be the primary responsibility of your attorney, as an experienced commercial real estate tenant representative broker, Metro Manhattan Office Space will help you understand the basic requirements and protections you should be aware of and will work in cooperation with your attorney during lease term negotiations.

What is Liability Insurance?

Liability insurance protects the insured from liability for third party claims for personal injury or property damage.

Insurance Requirements

New York City landlords require their tenants to have liability insurance. Commercial tenants are not permitted to take possession of leased space until their insurance policy is effective. You must provide the landlord with a certificate of insurance as well as copies of your insurance policy before you are allowed to move in.

New tenants must obtain and keep in full force and effect a commercial general liability insurance policy, which includes bodily injury, personal injury and property damage coverage. This policy must also have a broad form contractual liability endorsement naming tenant as insured and protecting landlord, landlord’s employees and managing agent as additional insureds, as well as any mortgagees or lessors having an interest in the building.

The amount and scope of the insurance policy is determined by the size of the space, the type of business that will occupy it, and the financial strength of the relevant party.

Liability Waivers

Commercial liability insurance is required because the landlord and its respective parties are at risk for claims by third parties arising out of the acts of tenant or its invitees. Most commercial leases will provide that the tenant must indemnify the landlord for any such acts and the tenant will be expected to look to its insurance for the appropriate recovery.

Tenants should be aware, however, that they also deserve the same protection under their lease agreement for acts caused by the landlord or its invitees in the surrounding portions of the building (assuming the tenant is not leasing the entire space owned by the landlord).

In general, it is important that you enter a fair lease with adequate protection for both landlord and tenant. Signing a landlord lease form that is not properly negotiated can have detrimental impacts on your business and financial liability. Landlords should be required to waive any liability of tenant for third party claims that took place on the property not being leased by tenant, particularly if tenant is paying for a portion of landlord’s property insurance as part of its operating expenses.

As a broker who only works for and on behalf of tenants we will help guide you through the process of purchasing insurance for your commercial real estate and understanding your liability. We always have your tenant rights in mind.

With Metro Manhattan Office Space finding your ideal commercial real estate is only the first step, we then help ensure that all of your interests are being protected when you are renting commercial real estate in Manhattan. We know that avoiding excessive costs can mean the difference between success and failure in your business.


Contact Alan Rosinsky, Principal Broker of Metro Manhattan Office Space, Inc., for a FREE consultation today: (212) 444-2241.

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