Commercial Landlord Insurance, matched properly
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Step 1 of 3What insurance do commercial landlords need?
Most commercial landlords look at building cover, loss of rent after insured damage and liability as the owner, while tenants usually insure their own fit-out and contents. No law requires landlord insurance, although in NSW a strata owners corporation must insure the building, and residential landlord policies generally exclude commercial property.
What commercial landlords commonly insure.
The covers owners of leased shops, offices, factories and warehouses most often look at. Sections and limits vary by insurer.
- The building Damage to the building from insured events such as fire and storm. If you lease it out, one insurer counts your fixtures and fittings, including floor coverings, as part of the building2.
- Loss of rent Rent lost while the building is repaired after damage the policy covers, for the indemnity period in the schedule1. One insurer counts base rent, turnover rent and tenants’ contributions to outgoings2.
- Liability as owner Claims when someone is hurt, or their property damaged, in connection with your building. It’s rated separately from the building and the rent3.
- Glass, theft and machinery Separate sections in one landlord policy, alongside property, loss of rent and liability1.
- Rent default Loss of rent doesn’t cover a tenant who stops paying while the building is undamaged4. One broker says rent default cover is “only available with most insurers when you professionally manage your property”5.
- Residential landlord policies The ones we reviewed cover only property used “principally and primarily” for residential rental, or exclude any commercial building6, 7. AFCA upheld a decline where tenants ran a hair salon from part of a rented home under a commercial lease8.
Who insures what under a lease.
It depends on the lease. These are the common arrangements.
- The building Usually on the landlord’s policy, with the cost recovered from tenants as an outgoing. For a single-tenant building, some leases make the tenant insure it in the landlord’s name9. In NSW, “it is common for tenants to contribute towards building insurance premiums whilst they are in occupation”10.
- Fit-out and contents Usually the tenant’s to insure. The landlord’s building policy doesn’t cover the tenant’s equipment, stock or fit-out9.
- The tenant’s public liability Most commercial leases require at least $10 million, “but more commonly $20 million”, often with the landlord named as an interested party11.
- Glass Some leases make the tenant insure plate glass. In others the landlord insures it and recovers the cost9.
- WA leases A tenant may have to insure “damage to the building and public liability” as a term of the lease12.
- Strata units In NSW the owners corporation must insure the building and hold at least $10 million of liability cover, and lot owners can take out their own insurance13. One strata insurer says lot owners need separate contents, business or landlord insurance14. In Queensland, fixtures a tenant can remove at the end of a lease aren’t part of the insured “building”15.
Passing premiums on to retail tenants.
Retail lease laws let landlords recover insurance premiums as outgoings, with limits that vary by state. Other commercial leases depend on their terms.
- NSW Outgoings include premiums the landlord pays as owner (s 3A). Land tax can be passed on, but only as if the land were the landlord’s only land (s 26). The Act doesn’t apply to shops of 1,000 m² or more16.
- Victoria Outgoings include premiums (s 3). A lease term is void to the extent it makes the tenant pay the landlord’s land tax (s 50)17.
- Queensland Outgoings include premiums, but not “insurance premiums for loss of profits” or the excess on the landlord’s insurance claim (s 7). Land tax can’t be passed on18, 19.
- WA Tenants pay only the operating expenses their lease itemises. A statement covering only items such as insurance premiums and rates needs no auditor’s report if proof of payment is attached, and land tax is limited to “notional land tax”, as if the land were the landlord’s only land (s 12)12, 20.
How much does commercial landlord insurance cost?
No insurer or regulator publishes commercial landlord premiums. These are one Queensland broker’s published quotes and estimates: a guide, not a quote.
A year. Quotes one Queensland broker placed on 12 September 2026, for buildings worth $1 million to $5 million.3
A year, in the same broker’s experience.3
A year, in the same broker’s experience.3
Building section only, gross annual premium including the broker’s fee. Five buildings quoted on 12 September 2026, Consolidated Insurance Brokers3:
Both $2 million buildings were non-combustible, with a $1,000 excess. The broker puts the gap down to the tenant’s trade. Loss of rent and liability cost extra on top of each figure3.
Vacancy and tenant damage.
Empty buildings and damage by tenants are where landlord policies set their own limits.
60 days
Unoccupied, or at Vero untenanted, before cover stops unless the insurer agrees1, 2.
To keep covering an empty building, Vero may charge extra premium, change the conditions or raise the excess. Its policy also requires landlords with tenants to inspect the premises regularly, including when tenants move in and out, and keep records with photos2.
Real claims.
Published decisions of the Australian Financial Complaints Authority (AFCA). Every claim depends on the policy wording and what the insurer was told.
- Empty for monthsThieves broke into a commercial building that had been without tenants for more than 90 days, and the insurer relied on its vacancy exclusion. AFCA found the insurer would have covered the vacancy for extra premium, so it had to pay the $102,269.85 claim less the $56,545.74 extra premium: $45,724.11, before the excess. Visits by the property manager didn’t count as occupancy. September 202421.
- An ATM countsA bank closed its branch but kept its ATM in the building, and its staff and contractors kept attending. AFCA found the insurer hadn’t shown the building was unoccupied, so it had to settle the water damage claim. December 202422.
- A new occupantA religious group using the upper floor of a leased restaurant building wasn’t disclosed at renewal. The insurer wouldn’t have renewed, so it could decline the theft claim and cancel the policy. October 202523.
- A tenant disputeAfter a fire, the insurer found the owner hadn’t disclosed a dispute with a tenant, and had said it would make sure tenants had fire equipment service agreements when that wasn’t the case. It could reduce the claim to nil. July 202524.
- Indemnity periodDamage the owner put down to a May 2022 storm was found only after the tenant left in December 2023. The 12-month indemnity period had ended before any rent was lost, so the loss of rent claim failed. The repair costs were settled separately. December 202525.
- The bond covered itAFCA found the owner hadn’t shown damage beyond what the tenant’s $15,000 bond would cover, and optional theft cover hadn’t been taken. The insurer paid $1,750 for the inconvenience its claim handling caused. August 202426.
Common questions.
Is commercial landlord insurance compulsory?
No law requires a landlord to insure a commercial building, although lenders and leases can. Strata owners corporations in NSW must insure the building.
Will a residential landlord policy cover a shop or office?
Generally not. The residential landlord policies we reviewed exclude commercial buildings, and AFCA upheld a decline where part of a rented home was run as a hair salon under a commercial lease.
Who insures the building, the landlord or the tenant?
Usually the landlord, who recovers the cost through outgoings. Tenants usually insure their own fit-out, contents and public liability, and some single-tenant leases make the tenant insure the building.
Can I pass the insurance premium on to my tenant?
Usually, as an outgoing the lease allows. Retail lease laws set limits, such as Queensland’s bar on passing on loss-of-profits premiums or the excess on the landlord’s claim.
Does loss of rent cover a tenant who stops paying?
No. Loss of rent pays after insured damage to the building. Rent default is a separate cover, and one broker says most insurers offer it only when the property is professionally managed.
What happens if my building is empty?
Cover can stop after a set time, such as 60 days with SUU and Vero or 90 days with QBE and AIG, unless the insurer agrees to keep covering it, which can cost extra.
Does strata insurance cover my commercial unit?
It covers the building and common property. One strata insurer says lot owners need separate contents, business or landlord insurance, and in Queensland fixtures a tenant can remove aren’t part of the building.
How much does commercial landlord insurance cost?
One Queensland broker’s quotes for the building section alone ranged from $4,013.49 to $13,884.89 a year for five buildings worth $1 million to $5 million, before loss of rent and liability.
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Who requires cover.
- Retail landlords Owners of shops and strips leased to retailers and food businesses
- Office landlords Owners of offices and professional suites
- Industrial landlords Owners of factories, sheds and warehouses
- Strata and multi-tenant owners Commercial strata units and buildings with several tenancies
Covers landlords look at.
Our guides to the covers commercial landlords most often ask about.
Sources.
- Commercial Landlord Insurance Policy Wording (SUUCL 1.0), Strata Unit Underwriters for CGU, November 2023
- Business Insurance Product Disclosure Statement, Vero, 4 June 2024
- How much does commercial landlord insurance cost in Australia?, Consolidated Insurance Brokers, 24 September 2026
- Loss of rent insurance for commercial property, Consolidated Insurance Brokers, 22 September 2026
- Commercial landlords, Affinity Insurance Services
- Landlord Preferred Policy Product Disclosure Statement, Terri Scheer, 29 April 2024
- Landlord Insurance Product Disclosure Statement, Allianz, 1 April 2025
- Determination 12-00-1080529, AFCA, 23 May 2025
- Who pays for building insurance on commercial property?, Sprintlaw, 24 June 2025
- NSW Retail Tenancy Guide, NSW Small Business Commissioner, 2022
- Why do tenants need insurance under a commercial lease?, LegalVision, 25 May 2026
- Understanding commercial leases, Small Business Development Corporation (WA)
- Strata Schemes Management Act 2015 (NSW), sections 160–167, NSW Legislation, 26 August 2026
- Commercial strata insurance, SUU
- Building insurance and valuation, Queensland Government, 9 July 2025
- Retail Leases Act 1994 (NSW), NSW Legislation, 15 August 2025
- Retail Leases Act 2003 (Vic), version 027, Victorian Legislation, 1 July 2024
- Retail Shop Leases Act 1994 (Qld), Queensland Legislation, 1 August 2025
- Outgoings factsheet, Queensland Small Business Commissioner, 2 July 2026
- Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA), section 12, WA Legislation, 30 June 2021
- Determination 12-00-1041605, AFCA, 23 September 2024
- Determination 12-00-1080266, AFCA, 5 December 2024
- Determination 12-24-151769, AFCA, 17 October 2025
- Determination 12-00-1088872, AFCA, 23 July 2025
- Determination 12-24-153781, AFCA, 22 December 2025
- Determination 12-00-1042883, AFCA, 9 August 2024