What sort of insurance should commercial tenant have?

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murphaph

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From the perspective of the letting landlord that is. Assume common yard to front of some units. Each unit has a set amount of exclusive yard in front of it before the common citculation area begins. Yard and units are open to the public and used for the motor trade. Landord has public liability/buildings insurance. Should tenant have public/employers liability insurance in place? Is it a problem or potential problem or liability for the landlord if these insurances are not in place?
 
It would be essential for the Landlors to have Public Liability Insurance in place in the case there was an accident in the yard area. What would happen if somebody get knocked down. The cost of the Insurance should be shared out by the tenants on a ratio basis according to the size of the units.
 
Excellent. The landlord has public liability and buildings insurance in place. I was just wondering would it be an issue for the landlord if the tenant didn't have employers liability in place?
 
It would be an hell of an issue if something happened and there was no Insurance in place. Talk about Russian Roulette.
 
Ok, so can we talk about potential scenarios. Landlord specifies explicitly in the lease that the tenant is financially responsible for any and all accidents that take place inside the unit and on the yard in front of the unit. Would the employee be considered a member of the public when on the common yard area?

If a landlord has this stipulation in the lease and an employee has an accident in the unit, and the tenant has not taken out employers liability insurance, what is likely to happen? Any repurcussions for the landlord? Can the landlord/landlord's insurance company simply point at the lease and state that the employer (tenant) is legally and financially responsible for any injuries sustained?
 
An employee of a tenant is always going to be a member of the public to a landlord as he has no contractual relationship with the person.
A landlord carries public liability in respect of the business description on their policy which in this case is property owner. That means that if a member of the public is injured on their property and as a result of their negligence the policy will pay out. That said, it is always going to be easier to sue under employers liability, as the employer is obliged to provide safe system/method/place of work.
If the landlord isnt liable his policy wont pay out. Simple as. In this day and age, any employer that doesnt take out is taking their chances with going out of business.
 
Thanks peteb. So as long as the landlord has ensured the yard and buildings and fittings are safe and sound that he has no liability for injury sustained by an employee of a tenant?
 
Not unless it is related to his negligence as the owner of the property!
 
In relation to matters of Insurance, it is essential and of paramount importance that full cover is provided. There is no point in trying to save costs on something that xcould cost a person their business at a later date.
 
Yes, we have full public liability in place for the entirety of the premises. I'm just wondering if it os expected that the tenant will have same, and if it can be specified in the lease that it is compulsory. We are not trying to save money by reducing cover, bit would like to make sure the tenant pays their share and/or has their own cover in place.
 
Well if you are the landlord, and it is in the lease then he will have to reimburse you. Simple as that. Whatever Insurance the tenant has or has not is his problem, You are just ensuring that you as landlord are covered.
 
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