Lessor's Risk Only — For Landlords Who Don't Occupy the Building.
LRO is the property-plus-liability program built specifically for commercial landlords who lease space to tenants. It's not a BOP, and it's not an owner-occupied commercial policy. The distinction changes what's covered — and what's excluded.
What Lessor's Risk Only actually is
LRO covers the building you own and the liability you carry as a landlord who leases it to others — but not the operations of the businesses inside it. Your liability under an LRO is the landlord's liability: the structure, the common areas, the roof and parking lot, the things you're responsible for as owner. The tenant's business operations are the tenant's exposure, carried on the tenant's own policy.
LRO vs. BOP — the distinction that matters
| LRO | BOP | |
|---|---|---|
| Built for | Owner who leases to tenants | Owner-operator running a business in the space |
| Liability scope | Landlord's premises liability | Business operations liability |
| Business income | Lost rents | The owner's business income |
| Wrong when | You operate a business in the building | You only lease space to others |
Put a landlord on a BOP and the liability is scoped to operations they don't run. Put an owner-operator on an LRO and their business operations aren't covered. Getting this right is the difference between a policy that responds and one that doesn't.
LRO and the tenant certificate workflow
Because LRO scopes the tenant's operations to the tenant, your protection depends on those tenants actually carrying their own liability insurance and naming you as additional insured. That's exactly what our tenant certificate workflow verifies — wrong additional-insured wording, low limits, and expired policies are the gaps that quietly shift a tenant's exposure back onto your LRO.
Who LRO is for
- Strip centers and single-tenant retail you own and lease out.
- Office buildings leased to professional tenants.
- Mixed-use where you're the landlord, not the operator.
- Industrial / flex space leased to a tenant's operations.
What it typically costs in NJ
LRO is rated on building value, occupancy, the tenants' operations, location, and loss history. A clean single-tenant retail building prices very differently from a multi-tenant center with a restaurant. We rate it against your actual tenant mix and lease structure.
FAQ
I lease my building to one tenant. LRO or BOP?
If you own the building and lease it out — even to a single tenant — and you don't run a business inside it, LRO is almost always the right structure. The BOP is for the operator. We confirm which one you are before binding.
Does LRO cover my tenant's inventory or equipment?
No. The tenant's business personal property and operations are the tenant's responsibility, on the tenant's policy. LRO covers your building and your landlord liability. This is why we verify your tenants' certificates of insurance.
What if my tenant doesn't carry insurance?
Then their exposure can land on you. Your lease should require the tenant to carry liability with you named as additional insured, and someone should verify the certificate is correct and current. That's our tenant certificate workflow.
Can LRO include loss of rents?
Yes. Lost rents while a covered loss makes the space untenantable is a core part of an LRO placement, set against your actual lease income. We size it to the rent roll.
Get the structure right — LRO, not a mislabeled BOP.
Tell us the building and the tenant mix. We'll confirm LRO is the right structure, rate it against your leases, and verify your tenant certificates. One intake covers it.