# NNN Landlord Insurance: What the Owner Still Needs

Source: https://www.creshield.com/resources/nnn-landlord-insurance-what-owner-needs
By Brad Cottam, CRE Shield (licensed in Kansas and Texas). Updated 2026-10-28.

On a true triple net (NNN) lease, the tenant usually carries and pays for the property insurance on the building. That does not mean the owner can ignore insurance. You still carry the risk that the tenant's policy is thin, lapses, or stops covering the building the day the tenant leaves. A good NNN owner either carries a few policies of their own or checks the tenant's coverage on a schedule. Often both.

I have owned single-tenant net lease buildings for 16 years. The insurance itself was rarely the hard part. The hard part was the paperwork around it: tracking renewals, collecting certificates, and billing tenants back for their share of the premium.

## What the tenant's insurance does for you

When the lease is a real NNN, the tenant buys property insurance on the building and names you on it, usually as the insured, loss payee or additional insured. The tenant also carries general liability and names you as an additional insured. If a fire or storm hits, the tenant's policy pays to rebuild, and your lender is protected through the mortgagee clause.

That is the best case. Three things decide whether it actually works:

- **What the lease says.** Some leases say "triple net" but leave the landlord to insure the building and bill it back. The label on the lease is less important than the insurance clause. See [how to read the insurance clause in your lease](/resources/reading-lease-insurance-clause) and [NN vs NNN vs absolute net](/resources/net-lease-insurance-nn-vs-nnn).
- **What the tenant's policy actually says.** Limits, deductibles, roof and wind or hail terms, and exclusions are the tenant's to choose within the lease's minimums.
- **Whether the policy is still in force.** Policies lapse, tenants switch carriers, and a certificate is only a snapshot.

## What you may still need on your own

**Landlord liability.** Being an additional insured on the tenant's liability policy helps, but it is narrow. The standard additional insured endorsement for lessors covers liability arising from the tenant's use of the premises, and you share the tenant's limits with everyone else on that policy. Many owners carry their own landlord liability policy so there is a layer that belongs only to them. More on that in [landlord liability on a net lease property](/resources/landlord-liability-net-lease-property).

**Vacancy.** Everything above assumes a tenant is in the building and paying. When the tenant leaves, their insurance ends, and a vacant building can be restricted under a standard policy within about two months. See [what happens to your insurance when a tenant leaves](/resources/vacant-building-insurance-after-tenant-leaves). This is the biggest gap for most NNN owners.

**Rent protection.** If a covered loss shuts the building down, most leases abate rent while the building is rebuilt. Check whether the tenant must carry business income coverage that includes your rent, or whether you need rental value coverage of your own. See [business income and rental value](/resources/business-income-rental-value-coverage).

**Umbrella or excess liability.** A serious injury claim can exceed a $1 million per occurrence limit. An umbrella over your own liability policy is relatively inexpensive protection for the owner.

**Gaps the lease allows.** A lease can require "full replacement cost" and still let the tenant choose a high deductible, a 5% wind and hail deductible, or an actual cash value roof. Those choices fall on the building, which is yours. [Roof age](/resources/roof-age-commercial-insurance) and [replacement cost vs actual cash value](/resources/replacement-cost-vs-acv) are worth reading with your tenant's policy in hand.

**Things leases often skip.** Flood, earthquake, ordinance or law (the extra cost to rebuild to current code), and environmental liability are commonly excluded from the standard policy and often missing from the lease's requirements.

## A simple yearly check

1. Ask for a current certificate of insurance, and for the policy's declarations page and property endorsements if the lease allows.
2. Compare limits, deductibles and named parties against the lease.
3. Put the expiration date on your calendar for 30 to 60 days out.
4. Confirm your lender's requirements still match.

## FAQ

### Do I need my own property policy if my tenant insures the building?
Often not while a creditworthy tenant carries full replacement cost coverage and your lender is satisfied. Many owners still carry coverage that picks up when the tenant's policy stops, for example at vacancy. Your lease and your lender decide what is required. A licensed agent can review both.

### Is being named an additional insured on my tenant's policy enough?
It helps, but it is not the same as owning a policy. Additional insured coverage generally applies to liability arising from the tenant's operations and shares the tenant's limits.

### What happens to my insurance if my tenant stops paying rent?
The tenant's insurance may stay in force for a while, but you should confirm. If the tenant vacates, the building can become "vacant" under the policy's definition and coverage can be limited.

### Who pays the deductible on a net lease?
The lease decides. Many net leases make the tenant responsible, but some leave the landlord exposed for part of it. Read the clause rather than assuming.

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*This article is general education, not insurance or legal advice. Coverage terms vary by policy, carrier, and lease. CRE Shield is licensed in Kansas and transacts insurance only in states where it is licensed.*