Commercial property insurance in Ontario covers buildings used for business — plazas, mixed-use buildings, multi-unit residential, industrial units and standalone commercial space — against loss to the building, contents, and lost rental income.
A plaza policy typically covers the building itself (structure, roof, mechanical and common areas), the owner's contents, loss of rental income if tenants can't operate after an insured loss, and commercial general liability for the landlord. Optional coverages include equipment breakdown, sewer backup, flood, earthquake, and bylaws coverage to rebuild to current code.
Yes — if your building generates rental income, loss of rents (rental income coverage) is essential. After a fire, water loss or other insured event, it replaces the rent you would have collected while the building is being repaired. Most carriers offer 12, 18 or 24 month indemnity periods; larger plazas often need 18–24 months because reconstruction and re-tenanting take time.
Vacancy changes your coverage. Most commercial property policies restrict or exclude coverage (especially water damage, vandalism and glass) once a unit has been vacant for 30 consecutive days. You must notify your broker, and a vacancy permit or endorsement may be required. Failing to disclose a vacancy is one of the most common reasons commercial claims are denied.
Coinsurance is a clause that requires you to insure the building to a stated percentage of its full replacement cost — typically 80%, 90% or 100%. If you're under-insured at the time of a loss, the insurer pays only a proportional share, even for partial losses. Getting an updated replacement cost valuation avoids a nasty coinsurance penalty on a claim.
Commercial property should be insured for replacement (rebuild) cost, not market value. Market value reflects land, location and income potential; rebuild cost is what it actually costs to reconstruct the building with today's materials, labour and code requirements. These numbers are often very different — especially for older plazas and mixed-use buildings.
Yes. Commercial General Liability (CGL) protects you as the landlord if someone is injured on the property — a slip and fall in the parking lot, a common-area incident, or damage caused by building maintenance. Tenant policies protect the tenant's business, not you. Every commercial building owner should carry CGL, typically $2M–$5M in limits.