When fires occur in rental units, whether commercial or residential, major disputes can arise between tenants and landlords. Fire legal liability alludes to who will be responsible for paying for the damage those fires cause.
The cost of fire damage to a property can run into the thousands. According to the National Fire Protection Association (NFPA), in 2020 there were 1,338,500 fires. These resulted in 21.9 billion dollars worth of damage!
The International Risk Management Institute (IRMI) defines fire damage legal liability coverage as “coverage of a tenant’s liability for damage by fire to the rented premises (including garages) the tenant occupies”. For business owners, this coverage is included under their commercial general liability policy. But, for that policy to pay for fire-related damages, there must be proof the insured party was at fault.
For instance, say that you’re renting a warehouse in Colorado Springs. One night before leaving, an employee accidentally leaves a space heater running next to some boxes. Later that evening, that box catches fire and the entire building goes up in smoke. By the time the fire was over, the building had suffered over $100,000 worth of damage. The owner of the building insists you pay for all damages since the fire was the cause of your business’s negligence. In this scenario, your fire legal liability would pay for these losses.
There are times when a tenant is guilty of starting a fire, but their general liability insurance won’t cover the loss. This happens when the lease the business signs states that it accepts full responsibility for any fire damage that occurs while they’re under that lease, no matter how the fire started. (Some businesses may sign such a lease to get a lower lease rate, gambling that a disaster will never happen.) The business will have to pay for damages because they signed such a contract. In this situation, liability insurance will only pay for damages if the renter directly causes the fire.
Additionally, these other limitations may exist:
Fires are sometimes caused by natural disasters that are no one’s fault, so it’s vital to take additional precautions. Explore your options and ask your insurance agent for a legal liability coverage form that will give you extra coverage for all types of damage, such as flooding and tornadoes, that could occur to a commercial property while you’re a tenant. This is the best way to protect your financial future if a major disaster befalls the property you’re leasing.
If you’re looking for expert restoration services in Pueblo or Colorado Springs, Colorado contact Cyclone Kleen Up today. Our commercial restoration service is reliable and available to you 24 hours a day, 7 days a week. We have over 31 years of property damage restoration experience that you can trust to repair and restore the damage done to your property efficiently.