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Commercial Risk Advisor - September 2018

Premises Liability for Building Owners/Managers

Risk Control from Liberty Mutual Insurance

The scope of exposure to liability loss and appropriate prevention strategies must be well understood by individuals and businesses who own or manage property.

Such losses can be brought not only by those who are invited or reside on the premises, but also in some cases, by those trespassing or otherwise with no legitimate reason to be on the premises.

The following are some tips for ways to help reduce your premises liability exposures.

Slips, Trips, and Falls

The most frequent and costly financial loss for building or property owners is slips, trips, and falls to patrons or the public on your premises. The best strategy to help prevent and control such incidents is to look first at the design of a number of areas.

Consider the following:

  • Floor and walkway surfaces that offer slip-resistant benefits. Dry floors are, for the most part, slip-resistant by design, but wet floors can be a problem. Pay special attention to floors at entrances, near rest rooms, water coolers, cafeterias, and other potentially wet areas.
  • Stairways to reduce exposure to falls. Stair riser height and tread depth should comply with applicable building codes, regulations, standards and/or ordinances. Each riser must be the same height for the full flight of stairs.
  • Walkway surfaces to reduce exposure to trips and falls. Adjoining floor surfaces and thresholds should be flush, and changes in level between ¼ and ½ inch (6 and 12 mm) should be beveled to minimize risk to surface changes to pedestrians as well as those impaired using wheelchairs, walkers, etc. Changes in level greater than ½ inch (12 mm) should be transitioned by means of a ramp or stairway. Refer to applicable building codes, regulations, standards, and/or ordinances.

- Make frequent inspections of floors and walking surfaces to monitor conditions.

- Make sure floors and walking surfaces are kept clean.

  • Entrance matting with slip, trip, and fall prevention in mind. Select matting system and surface material for expected environment and traffic load. Mat edges should be beveled and not curl by design. Keep a record of inspections to demonstrate due diligence.

Certifi ates of Insurance

Maintain up-to-date certificates for liability insurance from each of your tenants. Verify that each tenant names you as an “additional insured” on their general liability policy. Tenants should each have their own separate liability insurance that should also protect you, as your primary layer of protection, when they are at fault or if a suit is brought against them. Your legal counsel should advise you how to review these certificates to ensure that you are adequately covered. Your legal counsel can also advise you regarding the tenants’ policy limits and if that is suitable for the amount of risk you bear.


The best strategy to help prevent and control fires is to know the appropriate control measures for your tenants’ fire exposures. For example, cabinets for flammable liquids, fire sprinkler protected booth for spray painting, and UL (Underwriter’s Lab) compliant extinguishing system for deep fat fry cooking. The National Fire Protection Association (NFPA) has numerous fire prevention, detection, and suppression standards that contain helpful reference materials. Get familiar with those that affect your building and your tenants.

Roof Damage

Heavy rainstorms or snowfall can cause substantial property damage and can contribute to roof collapse. This damage typically occurs when water pools on the roof forming ice dams or infiltration when the temperature warms.

This type of loss scenario can best be prevented and controlled by soliciting the guidance of a professional roofer to:

  • Inspect the roof drains before the rainy/winter season to make sure they are clear of leaves and debris, check to see that the gutters and down spouts are in good condition, and make sure they are adequate to handle a heavy downpour or quick snow melt.
  • Periodically check to see that your roof is in good condition and that there is no evidence of water pooling, leaks or mold.

Restaurant Occupancies

Properties with restaurant occupancy can have potential fire risks in the kitchen. Hoods and other ventilation systems should be regularly cleaned and inspected. Restaurants using vegetable oil in their deep fat fryers should have a UL compliant automatic fire extinguishing system.

Fire Extinguishers

Portable fire extinguishers should be inspected and serviced by a qualified contractor at the following intervals:

  • Annually with the tag marked, noting the date and name of inspector.
  • When the indicator moves into the red zone.

Sprinkler Systems

For buildings with automatic and supervised sprinkler systems, a main drain and flow test should be conducted at least annually or more depending on local jurisdictions.

Outside Contractors

Outside contractors brought on to your premises to perform work can create a significant liability risk to your business.

Some examples include:

  • A plumber using a torch that ignites some building materials, resulting in both property damage and a business interruption claim — both a direct financial impact to you.
  • A sign installer who wires a light fixture incorrectly which results in a fire.
  • A landscaper who leaves tools out that someone trips over.

These types of losses can best be prevented or controlled by:

  • Pre-qualifying potential contractors ahead of time and checking references.
  • Developing a list of approved contractors who have provided you with a certificate for liability insurance and workers compensation. Check their contractor’s license number at the appropriate state website and obtain references from prior customers.
  • Obtaining a written contract approved by your legal counsel for the work to be done by other service providers or contractors with insuring agreements that offer ‘additional insured’ for your primary protection.
  • Inspect the jobsite frequently for hazards under your control. For those under their control, be certain it is an expectation that both parties agree to in the contract for work undertaken.

Neighbors and Tenants

Be aware of potential fire and liability exposures presented by neighbors and tenants. For example; a plastics manufacturer, woodworking operation, or tire storage facility can each present significant fire exposures. Child or senior day care facility create additional liability exposures.

Building Exterior

Have an effective system to inspect and maintain exterior walkways, grounds, and parking lots to ensure that they are in good repair and free of potholes, foreign objects, trash, clutter, ice, and snow. Make sure outdoor lighting fixtures are well-maintained and located where risk is greatest for both personal safety and security reasons.


Provide adequate security for all areas of public access commensurate with the type(s) of tenants and the location of the property. Frequent property inspections of both the interior and exterior, with written documentation are recommended, and are extremely valuable for claims defense.

Be certain to solicit the input and guidance from local law enforcement and crime scene analysts to determine crime patterns for incidents that would otherwise help justify greater security protections. In some cases, building owner’s or property manager’s failure to provide reasonable security to the crime victim against a foreseeable criminal attack can be a legal “cause” of the occurrence.

Additional Resources

Additional resources can be found in the following Liberty Mutual Insurance Risk Control reference notes.

  • Controlling falls on stairways, RC 5158
  • Crowd management and control practices, RC 5285
  • Emergency preplanning for workplace security, RC 5341
  • Keeping your retail business invitees safe, RC 5252
  • Preventing slips and falls: floor cleaning and maintenance, RC 5410
  • Preventing slips and falls: floor surfaces and treatments, RC 5413
  • Preventing slips and falls: selecting the right matting system, RC 5408
  • Preventing outdoor same level slips, trips, and falls, RC 5434
  • Retail robbery precautions, RC 5019
  • Using snow logs to manage outdoor slips, trips and falls, RC 5396