My landlord requires insurance for my e-commerce business — what do I actually need?
A lease for a small warehouse, office or storage unit usually asks for liability coverage at a stated limit with the landlord added to your policy, plus property coverage on your own stock and equipment. Match each line of the insurance section to your policy and send proof before you move in. With no landlord, a home or a third-party warehouse contract sets the terms instead.
- The landlord's protection generally comes from written changes to your policy, not from the certificate. Send the changes with the certificate.
- Under most leases your stock and equipment are yours to insure, and the landlord's building policy is designed for the building.
- With no landlord, a third-party warehouse's storage agreement takes the lease's place and generally caps what the warehouse pays for your goods.
What does a small warehouse or office lease ask me to carry?
Usually liability coverage at a stated limit, the landlord named on that policy, and property coverage on your own stock and equipment. Riskier uses add more. Your lease names its own numbers, so read them instead of assuming.
A lease can put the requirement in three places: an insurance section, a section where you promise to pay the landlord's costs if your business causes a claim, and an exhibit at the back. Read all three together. If you are not sure your policy stands behind that promise, ask your agent and your attorney.
The table shows wording you may see. The limits come from one industry paper on shopping-center leases, written by an insurance broker and a law firm, that suggests what a landlord might ask for. A small warehouse lease may differ. (Source: International Council of Shopping Centers)
| The lease says | It means | What to send back |
|---|---|---|
| Tenant carries general liability of $1M per occurrence. | Liability coverage pays up to $1M for one claim. | A certificate showing that limit. |
| Landlord is named as additional insured. | Your policy can defend the landlord over claims from your use of the space. | A copy of the written change, not only the certificate. |
| Coverage is primary and non-contributory. | Your policy pays first and does not ask the landlord's insurer to share. | The policy wording; ask your agent to show you where it is. |
| Tenant waives subrogation. | Your insurer agrees not to recover what it paid from the landlord. | A copy of the written change. |
| Tenant insures its own contents and improvements. | Property coverage on your stock, shelving and equipment. | A certificate showing property coverage at the address. |
| Tenant carries workers' comp and employer's liability. | Cover for hurt employees; the lease may set $1M per accident. | A certificate; ask your agent what applies with no employees. |
| Tenant carries environmental coverage if it stores hazardous materials. | Separate cover for cleaning up a leak or spill, which can matter for batteries and aerosols. | Proof, if the lease asks; ask whether your policies already include it. |
| Insurer meets a minimum rating; proof at move-in and yearly. | The insurer has a financial grade from a rating agency. | A certificate at move-in and at each renewal. |
Example wording from one industry paper's suggestions, not a rule. Your lease sets its own limits, and your policy wording governs what is covered.
Which parts do I have to ask my insurer to put in writing?
Three: adding the landlord to your liability policy, making your policy pay first, and your insurer giving up the right to go after the landlord. Each goes on your policy as a written change, and a certificate by itself usually does not create it.
- An additional insuredAdditional Insured Another person or business covered under your liability policy for claims tied to your work or property, such as a landlord or general contractor. Insurers call them an additional insured. more → is a person or business added to your liability policy so it can be defended over claims that come from your use of the space.
- Primary and non-contributoryPrimary and Non-Contributory A contract-required setting where your policy pays first on a claim and does not ask the other party's insurance to share. Insurers call it primary and non-contributory. more → wording means your policy pays first and does not ask the landlord's insurer to share the claim.
- A waiver of subrogationWaiver of Subrogation A policy add-on where your insurer gives up the right to pursue a party you agreed by contract not to blame after a loss. Insurers call it a waiver of subrogation. more → means your insurer agrees not to try to recover what it paid from the landlord.
Your insurer issues each of these as an endorsementEndorsement A written change attached to your policy that adds, removes, or alters coverage partway through the term. Insurers call it an endorsement. more →, a written change attached to the policy. Having one does not give you the others, so ask for each by name.
The same industry paper says insurers usually send cancellation notices to you, not to an added party, and that notice to a landlord is no longer common practice. If your lease asks for it, ask your insurer before you sign whether it will agree. If the lease asks for a higher liability limit than you carry, ask whether an umbrella policy, which stacks extra liability coverage on top, can meet it. The limit is often something you can raise with the landlord before signing.
What do I send back, and when?
Send a certificate of insuranceCertificate of Insurance (COI) A one-page proof of your coverage, showing the insurer, policy number, and limits, that you hand to a landlord or client. Insurers call it a certificate of insurance. more →, a one-page summary of your coverage, together with copies of the written changes that name the landlord. Most leases set the date; if yours does not, send them before you move in and again at every renewal.
A certificate shows that you bought certain coverage and limits. The landlord's protection is only as strong as the policy behind it. Our explainer on what a certificate is shows each box on the form. If you change insurers, the new insurer has to issue its own written changes, and you send new proof. A gap in coverage may put you in breach of the lease, so ask your attorney how yours treats one.
Your stock and equipment are usually yours to insure, because the landlord's building policy is designed for the building. Set your property coverage at what the stock would cost to replace, and settle in writing who insures any shelving or fit-out you paid for.
Staff change the picture too. If you hire packers, the lease may ask for workers' comp, and the rules by state are in our guide to e-commerce insurance requirements by state. Our general guide to what a landlord can require covers any type of business.
What changes if I have no landlord?
The lease clause goes away, but the requirement moves. In a third-party warehouse, the storage agreement takes the lease's place and generally limits what the warehouse pays for your goods. At home, no document asks for insurance, so the question becomes what your own policies cover.
The model text of the Uniform Commercial Code, the standard commercial law, says a warehouse is liable for loss caused by its failure to use reasonable care. It also says the amount may be limited by a term in the storage agreement, and that the owner can ask in writing for a higher limit when signing, possibly at a higher storage rate. (Source: Cornell Legal Information Institute) Your state's version may differ, so ask your attorney. Read the agreement for three things: the cap on what the warehouse pays, whether it asks for your certificate, and who insures your goods while they sit there. A marketplace's own warehouses work the same way, with their own written rules; our guide to marketplace seller agreements covers them.
Your own property policy may not follow the stock there. One widely used standard form pays at most $10,000 for covered property temporarily at a location you do not own, lease or operate, and it does not apply to property in or on a vehicle. (Source: Independent Insurance Agents & Brokers of America) Your own edition may differ. Ask your agent to list the warehouse as a covered location, raise the limit, or add cargo and inland marine coverage for goods that travel.
At home, whether a homeowner or renter policy covers business stock or a business liability claim depends on that policy's wording. Ask your insurer before you rely on it.
Frequently asked questions about lease and warehouse insurance
Usually not. Most leases make your stock your job to insure, and the landlord's policy is designed for the building. Read who insures what, including any shelving or fit-out you paid for.
Some storage agreements ask for one. Read yours, and ask the warehouse what it wants named on the certificate.
You can sign, but many leases ask for proof of coverage before you take possession. Send your agent the insurance section and any exhibit early, so the policy is built to match it.
Have your lease's insurance section checked against your policy
Include the insurance section and any exhibit from your lease or storage agreement with your quote request, so the coverage is built to match what is asked.