Posted October 19, 2022
Tenant Occupied Areas

As a tenant, ICC quotes three optional coverages to protect your interest in the premises you occupy: Building coverage, Damage to Premises Rented to You, and Broadened Coverage for Damage to Premises Rented to You.

Building coverage can be offered when, per your lease, you are required to insure the building. ICC can consider insuring buildings where the building is at least 50% occupied by a risk in our niche. However, if building coverage is not requested on the application, ICC automatically includes $25,000 in building coverage as an option. This is not coverage for the entire building or the space you occupy. This is an optional coverage for instances where the lease may require you to insure typical building items, such as the HVAC system (heating and air).

You may be thinking, “If I’m not required to insure the building, how do I protect myself from possible damage to the building?” This is where our other options, Damage to Premises Rented to You and Broadened Coverage for Damage to Premises Rented to You, come in. These two coverages only apply to the portion of the building occupied or rented by you. They are liability coverages as you do not own the building and, therefore, it is not your property. If you need to insure the entire building, you will need to have Building coverage. For either Damage to Premises Rented to You or Broadened Coverage to respond, there are six criteria that must apply:

  1. You must be a tenant
  2. You do not insure the building
  3. You must lease or rent the property from others
  4. The property is occupied by you (under your care, custody, and control)
  5. The property was damaged
  6. You are held legally liable for the damage

Damage To Premises Rented To You provides insurance protection for the fire and explosion exposure to the premise you do not own but rent or temporarily occupy with permission of the owner. Examples where coverage could apply would be a kitchen fire, spontaneous combustion by oily rags, etc. ICC automatically includes a $100,000 limit with our BOP quotes.

Broadened Coverage For Damage To Premises Rented To You provides insurance protection for damage caused by a covered cause of loss other than fire and explosion. As Broadened Coverage expands covered perils insured against, its limit cannot be more than the Damage to Premises Rented to You limit. Some potential coverage scenarios are:

  • Heat from candles on the table cause the building sprinkler system to go off, causing water damage
  • An altercation ensues, and property is damaged by gunfire or other means
  • The insured fails to clean the grease filter that vents to the outside, and the grease damages the roof
  • A water faucet is left on, and water damages the floor

The above are only examples where coverage could apply and do not indicate that coverage will apply. As you can see there are many scenarios where you could be responsible for damage that has occurred to the premises you occupy. The cost to repair the building can add up, but there are coverages that can help protect you.

Please contact your ICC Agent with any questions or Find an Agent in your area.