In commercial real estate, claims and losses are inevitable for any property. Drawn-out legal battles, damages to your reputation, and steep fines are not. 

If you fail to detect and prevent risk in a commercial building, even simple mistakes like a tenant slipping on ice in your parking lot can cost you millions.  

Despite the importance of proper coverage, around 75 percent of US businesses are underinsured by at least 40 percent, according to the Insurance Information Institute. In commercial real estate (CRE), this number is even higher: Most firms have a compliance rating of under 50 percent.  

Clearly, effective risk management is an industry pain point.  

So, Building Engines decided to spill some secrets to commercial building insurance guaranteed to save you time, money, and effort. 

Know the Basics

The number one way to mitigate tenant and vendor risk on your property is to have air-tight certificate of insurance (COI) management. 

What is a COI, anyway? And why is accurate COI management so important in commercial real estate 

A COI is a snapshot of current insurance coverage at the point of issue. It lists all points of coverage including additional insureds named parties who are covered by the policy but are not the original policy holder. (Hint: This is you!). 

Your company must be named as an additional insured on all your tenant and vendor insurance contracts to protect your organization from risk. This includes negligent acts by your tenants or vendors.  

To avoid steep premium hikes and reduce unnecessary costs, every COI must always be valid and up to date. 

1. Sweat the Small Stuff

To reiterate, you need a valid COI from every tenant and vendor, showing your organization named as an additional insured. Send them an example certificate to eliminate confusion about what is required.  

Then your certificate needs to be reviewed for coverage limits, amendmentseven proper spelling of your company name. Ensuring you get this right can save you a lot of trouble down the road. 

2. Automate COI Tracking

Manually tracking certificates typically involves hours of combing through spreadsheets and stacks of paper, sending emails to chase down certificates, and manually entering data.  

Tracking COIs this way is an inherently error prone process, particularly for large properties or portfolios. It’s easy to mis-enter an expiration date, double enter certificates, or miss crucial details. Any data entry error increases your insurance riskmaking it more likely you’ll be footing the bill for an expensive loss or claim.  

Software solutions that automate COI management speed up the process and eliminate human error. 

These solutions store all certificates in one central database, putting an end to spreadsheet chaos. And most software options read and record COI info for you, so your team doesn’t have to manually enter certificate data.  

And they provide automatic reminders of expiring policies, giving you plenty to follow up with tenants or vendors to ensure proper coverage. 

3. Verify Policies Every 90 Days

Hiring a service vendor who isn’t properly insured makes you liable for any of their mishaps while they’re on the job. 

Say a painter with an expired COI falls from a ladder in your lobby. Bam! You’re hit with a costly lawsuit and are on the hook to pay for all related medical expenses.  

Many property teams fall into this trap by assuming COI management is a one-and-done task. But even if your vendors have the right insurance when you hire them, you have to regularly verify these certificates. 

Unfortunately, some vendors only buy an insurance policy to land a contract. Then they immediately cancel the policy once they’re hired leaving you at risk of claims.  

The answer? Check vendor insurance at least every 90 days to make sure COIs are up-to-date and they aren’t pulling the wool over your eyes. 

4. Leverage Expert Guidance

Even if you do your homework, getting the ins and outs of compliance right has zero margin for error. So, why not call in the experts? Some property teams keep an in-house commercial building insurance expert or hire a firm. But this can be a budget-draining expense.  

Better value is an insurance software solution that includes expert guidance. You get the advice you need for a fraction of the cost of in-house solutions.  

These experts not only answer your trickiest questions, they work directly with vendors and their agents, and upload certificates themselves. This saves you hours of admin time.  


Hidden risks lurk everywhere on a property, which can easily snowball into million-dollar lawsuits. And if you’re struggling to re-occupy your portfolio, the last thing you need is a costly settlement. 

It’s entirely possibly to get by with manual processes. But growth-minded property teams don’t spend hours each week reviewing COIs and inputting data. 

To reach 100 percent compliance (and 100 percent peace of mind), consider commercial building insurance software such as Prism Insurance.  

It manages risk and improves compliance at a fraction of the cost of in-house solutions. 

Your COI tracking is fully automated, and you gain visibility into the compliance status of every tenant and vendor, along with a team of insurance experts. 

For more secrets to commercial real estate insurance and risk mitigation, watch our webinar Risky Business: Keeping Your Insurance House in Order.