🏢 Lease Compliance: Tenants’ Legal Liability & Evidence of Insurance 🇨🇦
For businesses renting commercial space in Canada, lease compliance is just as important as paying rent on time. Two areas that often create confusion are Tenants’ Legal Liability and Evidence of Insurance.
⚡ Tenants’ Legal Liability
- Protects tenants if they accidentally damage the landlord’s property—for example, a fire 🔥 caused by faulty wiring in your unit or water damage 💧 from a burst pipe.
- This coverage is typically required in lease agreements to ensure landlords aren’t left with uncovered losses.
- Standard Commercial General Liability (CGL) policies often include this protection, but coverage limits should always align with lease requirements.
📑 Evidence of Insurance (COI)
- Landlords frequently require tenants to provide a Certificate of Insurance as proof of coverage.
- The COI may need to show specific protections—such as CGL, property, or business interruption—and often must name the landlord as Additional Insured.
- Failing to provide an updated certificate, or one with the correct limits, could mean non-compliance with your lease—leading to potential legal and financial consequences.
📌 Why It Matters
Lease agreements shift risk from landlords to tenants, and insurers expect tenants to meet these obligations. Reviewing your lease with your broker ensures your insurance program aligns with what you’ve agreed to—and prevents costly oversights.
✅ The Takeaway
Lease compliance isn’t just paperwork—it protects your business, your landlord, and your relationship with them. Always confirm that your Tenants’ Legal Liability coverage and Certificates of Insurance meet the terms of your lease.
👉 When was the last time you reviewed your lease insurance requirements?
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