Commercial leases generally require landlord, tenant or, in most cases, insurance covering the building and parties to the lease. The insurance clause in the lease defines the necessary coverage and the persons responsible for it. Some insurance requirements are common, for example. B property damage and liability insurance, while others are more specific for leased land, such as. B loss of rent or operating stoppage coverage. Insurance clauses are particularly important for companies that work with hazardous substances. These types of businesses should pay particular attention to the insurance requirements of their lenders. Here are some of the most important commercial tenancy clauses that tenants should be aware of: net commercial tenancy agreements define tenants` responsibilities based on whether the lease is a simple, double or triple net tenancy agreement. Tenant bonds in a single net lease are monthly rents and property taxes. With a net double lease, tenants` responsibilities extend to insurance, and in a triple net lease, the tenant is responsible for rent, property taxes, insurance and maintenance.

If the insurance clause requires the tenant to provide insurance, the clause will set minimum amounts of coverage and, in most cases, require the tenant to provide the lessor with copies of all insurance policies. Net leasing is most common in new, well-located and professionally managed Class A buildings; For this reason, they are often the least negotiable. For each of these types of coverage, one of the main elements of a commercial lease is the definition of who pays them. Typically, the lessor pays in a full service or gross rental for all operating costs of the building, including insurance. On the other hand, in the case of triple net leases, the tenant pays her share of all costs, including the landlord`s and tenant`s insurance. However, for leases between the two extremes, these terms can be negotiated. What complicates matters further is that the company that protects coverage has nothing to do with the company that pays for it. For example, a liability policy paid to the tenant should cover both the tenant and the landlord. The tenant insurance clause in a commercial tenancy agreement provides that the tenant must benefit from general liability, an interruption of operations, an all-risk property and worker`s compensation insurance.