Certificate of Insurance Requirements in a Commercial Lease

A commercial lease almost always requires the tenant to carry insurance and prove it with a certificate of insurance, or COI. The standard requirements are commercial general liability at a stated limit, property coverage on the tenant's improvements and contents, the landlord (and often its manager and lender) named as an additional insured, and a waiver of subrogation. The tenant delivers a COI at move-in and renews it every policy year, and the landlord's job is to check that what the certificate actually shows matches what the lease demands.

Last updated July 2026.

Insurance is the clause everyone signs and nobody reads until there is a fire, a slip-and-fall, or a flood. At that point the difference between a compliant certificate and a defective one is the difference between the tenant's insurer paying the claim and the landlord paying it. Here is what a commercial lease typically requires, and what actually has to be verified on the certificate.

What insurance does a commercial lease require a tenant to carry?

A typical commercial lease requires the tenant to maintain several coverages:

• Commercial general liability (CGL), covering bodily injury and property damage claims arising from the tenant's use of the space, commonly at $1 million per occurrence and $2 million aggregate.
• Property insurance on the tenant's improvements, betterments, fixtures, and personal property, usually at replacement cost.
• Business interruption coverage so the tenant can keep paying rent if a casualty shuts it down.
• Workers' compensation at statutory limits if the tenant has employees.
• Umbrella or excess liability, often $2 million to $5 million or more, sitting above the CGL.

The specific limits are negotiated and scale with the size and risk of the tenancy. A single retail suite carries lower requirements than an industrial tenant handling hazardous materials.

What does "additional insured" mean in a lease?

Naming the landlord as an additional insured extends the tenant's liability policy to cover the landlord for claims arising out of the leased premises. It is the single most important insurance requirement, because it is what lets the landlord claim directly under the tenant's policy after an incident, instead of suing the tenant to recover. A lease that requires additional insured status but a certificate that omits it leaves the landlord exposed exactly where it thought it was protected. Many leases also require the property manager and the lender to be named, so the certificate has to be checked for every required party.

What is a waiver of subrogation and why do leases require it?

A waiver of subrogation is the tenant's insurer agreeing not to come after the landlord to recover money it paid on the tenant's claim. Without it, the insurer could pay the tenant for a loss and then sue the landlord for reimbursement, defeating the purpose of the coverage. Commercial leases usually require mutual waivers of subrogation so neither party's insurer can pursue the other. The certificate should reflect that the waiver applies to the relevant policies.

What does a landlord check on a tenant's certificate of insurance?

A landlord reviewing a COI is confirming five things:

• The named insured is the actual tenant on the lease, not an affiliate or a prior entity.
• Every required coverage is present, at or above the required limit.
• The landlord (and manager and lender, if required) is listed as an additional insured.
• The waiver of subrogation is shown where the lease requires it.
• The policy has not expired, and the landlord is the certificate holder entitled to cancellation notice.

A certificate can look complete and fail any one of these, which is why a careful review reads the form line by line against the lease rather than filing it on sight.

How often does a tenant have to provide a certificate of insurance?

A tenant provides a COI before taking possession and then every time the policy renews, typically annually. The lease usually requires the tenant to deliver a new certificate before the current one expires, and to give notice if coverage is cancelled or materially changed. The practical failure is silent lapse: a certificate expires, no one collects the renewal, and the tenant operates uninsured until a claim reveals the gap. That is why landlords track every certificate's expiration on a calendar and chase the renewal 30 days out. The same property manager collecting these certificates also handles the building's vendor and contractor paperwork, and can automate the accounts payable for those vendors in the same back-office workflow.

What happens if a tenant does not maintain required insurance?

Failing to carry required insurance is a default under most commercial leases. The landlord's remedies usually include the right to purchase the coverage itself and bill the tenant for the premium, plus the standard default remedies if the breach is not cured. The bigger exposure is uninsured loss: if the tenant lets coverage lapse and then a claim hits, the tenant may be personally liable and the landlord may find its own carrier stepping in, then subrogating against a tenant that cannot pay. Enforcing the insurance clause is cheap; discovering it was unenforced after a loss is expensive.

Turning a stack of certificates into a tracked register

On a single suite, checking one COI a year is manageable. Across a portfolio, hundreds of certificates arrive on different forms at different times, each governed by a different lease, and manual tracking breaks down. Pulling each certificate into structured fields, insured, coverages, limits, additional insureds, waiver, and expiration date, lets a manager compare every certificate against its lease requirement and see every upcoming lapse in one place. That is what certificate of insurance abstraction produces, and the insurance requirements themselves sit inside the broader commercial lease abstract template. The related diligence certificate landlords collect is covered in the guide to the estoppel certificate.

The bottom line

A commercial lease requires the tenant to carry liability and property coverage, name the landlord as an additional insured, waive subrogation, and prove all of it with a certificate of insurance delivered at move-in and every renewal. The landlord's protection is only as good as its verification, so check the named insured, limits, additional insured status, waiver, and expiration on every certificate, and track the whole portfolio's expirations so no coverage lapses unnoticed. To do that at scale, abstract every certificate with certificate of insurance abstraction and put the expirations on the calendar with critical date extraction.