In leases insurance can refer to property damage insurance or a commercial general liability policy and it is included in a gross lease, but will be added in net lease.
Landlords get special form property and casualty insurance which will have exclusions for certain types of disasters, which can be insured through additional insurance.
Property and casualty insurance covers the building structures and some of the landlord’s own property but will exclude the tenants’ own property, which should be insured separately.
There are also exclusions for HVAC systems, which must be insured through separate insurance policies.
The business consequences of the destruction of a building are not covered, this can be addressed through business interruption insurance.
Tenants who are leasing the entire building can be required to to purchase the property and casualty insurance for teh whole building and pay the insurance company directly (subject to the landlord’s approval and naming the landlord as an additional insured).
The insurance company should be aware of any additional improvements and policy limits may need to be increased. Sometimes landlords will pay the insurance policy and pass the cost onto the tenant to ensure that the policy is kept active.
Get started with your lease review by an Oregon Commercial Leasing Attorney.
Continue to read our articles on Oregon Commercial Leases.
Read about other legal services from Oregon Real Estate Lawyer or visit our blog on Oregon Real Estate Law.
For any additional information, contact us at (503) 274-9001 or by CFLink or go to the home page of Andrew Svitek, PC.