Florida Commercial Property Insurance: What Lessor Risk Owners Must Know in Today's Market

If you lease out commercial property in Florida, you’re not just managing tenants - you’re managing risk. The insurance landscape may be leveling out, but that doesn’t mean it’s easy to navigate. With shifting underwriting standards, policy exclusions, and rising rebuild costs, what used to be "standard coverage" may now fall short.

 

At Pelican Shield Insurance Group , based in St. Petersburg and serving all of Florida and Virginia, we work with commercial property owners who need more than just a policy - they need a plan. Contact us to talk strategy, or learn more about how we work.

 

What Is Lessor Risk Insurance?

 

"Lessor risk" refers to the unique exposures you carry as a commercial property owner who leases to tenants. You may not run the day-to-day business operations inside the building, but you’re still responsible for the structure, shared spaces, and certain liability exposures.

 

A typical lessor risk policy includes:

 

  • Commercial Property Insurance – Covers physical damage to the building.
  • General Liability – Protects against third-party injury or property damage.
  • Loss of Rents/Business Income – Reimburses lost rental income due to a covered event.

 

But in Florida, with its regulatory climate and storm risk, "typical" often isn’t enough.

 

What’s Changing in Florida’s Commercial Insurance Market?

 

After years of rate hikes and reduced carrier participation, the market is beginning to stabilize. Here's what lessor risk owners should know for today's market:

 

More Carriers Are Re-entering Florida

 

Admitted and surplus lines carriers are starting to return with renewed capacity - especially for well-maintained office, retail, mixed-use, and light industrial properties.

 

Underwriting Is Still Tight

 

Clean roofs, solid maintenance records, and tenant stability are key. But if your property checks those boxes, you’re more likely to see competitive terms.

 

Rates Are Stabilizing

 

Premiums are no longer rising at the double-digit pace we saw in past years. In fact, well-positioned risks may see modest decreases at renewal.

 

Translation: The door is opening again for smart coverage - but you have to be prepared.

 

Coverage Florida Property Owners Actually Need

 

Here’s what a modern lessor risk policy should include:

 

1. Replacement Cost (RCV)

 

Avoid Actual Cash Value (ACV) policies when possible. RCV ensures you’re not stuck footing the depreciation gap if you have to rebuild.

 

Recommended add-ons:

 

  • Ordinance or law upgrades
  • Debris removal
  • Inflation guard endorsements

 

2. Windstorm and Named Storm Coverage

 

Don’t assume it’s included. Confirm deductibles - especially those based on percentages - and know how they apply in hurricane zones.

 

3. Flood Insurance

 

Even if you’re outside a FEMA flood zone, heavy rain or drainage failures can lead to costly claims. The private market can sometimes offer more flexible options than the NFIP.

 

4. Equipment Breakdown

 

HVAC failure, electrical panel damage, elevator malfunctions - these aren't always covered under standard property policies but can affect tenant satisfaction and revenue.

 

5. Loss of Rents (Business Income)

 

One of the most underutilized but essential coverages. Look for:

 

  • Actual loss sustained basis
  • Coverage for civil authority shutdowns or utility interruption
  • 12–18 months of coverage, minimum

 

6. General Liability Coverage

 

Never assume your tenants’ liability policies protect you. As the property owner, you’re liable for:

 

  • Slip-and-falls in common areas
  • Trip hazards in parking lots
  • Faulty handrails or poor lighting in stairwells

 

Your GL should include:

 

  • Premises liability
  • Medical payments
  • Legal defense costs

 

We make sure your liability coverage lines up with your leases - and with your actual exposure.

 

Aligning Tenant Responsibilities with Your Policy

 

Your leases should work in tandem with your insurance - not against it. Here’s what to include:

 

  • Require tenants to carry their own GL and property insurance
  • Collect updated COIs (certificates of insurance) annually
  • List yourself as additional insured on tenant policies
  • Include hold harmless and indemnification clauses

 

Pelican Shield helps you align lease language with your policy so underwriters - and courts - see a clear chain of responsibility.

 

Positioning Your Property for Better Terms

 

Want more favorable pricing or better coverage options? Here’s how to position your property in this evolving market:

 

  • Keep roofs and systems updated – Underwriters want to see updated, maintained infrastructure.
  • Keep occupancy high – Vacancy lowers insurability and drives rates up.
  • Favor stable, low-risk tenants – Your tenant mix impacts how underwriters rate your building.
  • Bundle policies – Multi-building portfolios may get preferred pricing.

 

And of course - work with a broker who knows the market(you found one). 

 

Presenting your property correctly to underwriting not only improves pricing but can also speed up the entire quoting process.

 

Mistakes That Still Hurt Florida Property Owners

 

We still see these trip up even experienced investors:

 

  • Assuming wind or flood coverage is built-in
  • Skipping annual reviews of coverage and valuation
  • Letting policies lag behind real rebuild costs
  • Not catching exclusions such as for cosmetic roof damage or roof age schedules
  • Working with generalist agents who don’t understand commercial risks

 

If you’re not sure what’s in your policy or if it's the coverage you need, that’s a problem we can solve.

 

Why Pelican Shield

 

We’re not here to oversell or dazzle you with buzzwords. We’re here to dig into the details and make sure you’re covered when it counts.

 

We work with commercial lessor risk clients across Florida and Virginia - including portfolios, standalone buildings, coastal zones, and everything in between.

 

We also partner with multiple carriers and underwriters to match you with the right market - and the right terms by po

 

No surprises. No guesswork. Just real protection that holds up.

 

Let’s Talk

 

Florida’s commercial insurance market is finally stabilizing. That means smarter strategies are possible again - if you’re working with someone who’s actually paying attention.

 

Whether your properties are in Tampa, Miami, Orlando, Jacksonville, or beyond - Pelican Shield is here to help you make the most of this market shift.

 

Check out more resources on the Pelican Shield blog , contact us , or just call 727-369-9077.

 

We do what we say we’re going to do. And then we get it done.

 
 

DATE


Aug 14 2025 14:13


AUTHOR


David Jenkins