Cover for the liability a tenant bears to the landlord (owner) for a fire that arises in a leased shop, office or factory. Under Articles 390 and 623 of the Civil Act the tenant has a duty to return the leased property, and where it is destroyed by fire the burden of proof shifts to the tenant — this insurance relieves that burden.
N2N Insurance Brokerage does not represent any single insurer — it independently represents the client as an FSS-registered broker (Reg. No. 2026-012201). We compare the wordings, rates and service of AIG · Chubb · DB · Hyundai · KB · Meritz to propose the cover and price best suited to your risk. Each insurer's full wording is provided at application and binding.
Cover for the liability a tenant bears to the landlord (owner) for a fire that arises in a leased shop, office or factory. Under Articles 390 and 623 of the Civil Act the tenant has a duty to return the leased property, and where the leased property is destroyed by fire the burden of proof shifts to the tenant — this insurance relieves that burden.
Shops, offices, factories, warehouses.
A head-office standard requirement.
Leased factories and logistics warehouses.
Ordinary housing tenants.
| Leased-property loss | Replacement value of the leased part |
|---|---|
| Property (neighbours) | Per-accident limit by neighbouring environment |
| Recourse defence | Defence against recourse from the landlord's insurer |
| Household-goods fire loss | The tenant's household goods |
|---|---|
| Day-to-day liability | Combined general liability |
| Business-interruption loss | Business stoppage after a fire |
| Policy period | 1 year (linked to the lease) |
|---|---|
| Insurers | AIG · Chubb · DB · KB · Meritz · Hyundai (compared) |
| Limit | Leased property and neighbouring-property limits by environment |
| Turnaround | Same day – 2 business days |
| Channel | Individual consultation with our broker (010-5755-6465) |
If the insured event has already occurred at the time the contract is made, the contract is void. However, where the contract is void due to the company's intent or negligence, or where the company knew or could have known of the nullity before acceptance yet did not refund the premium, the company refunds the premium with interest at the policy-loan rate published by the Korea Insurance Development Institute, compounded annually, for the period from the day after payment to the day of refund.
The specific losses not covered (exclusions) are set out in each insurer's policy wording and product description; on this page, see the “Cover” tab(or the “Losses not covered” section) for the main exclusions. For other cover-specific grounds on which claims are not paid, please refer to the policy wording.
The company provides cover, in accordance with the policy, from the time it accepts the application and receives the first premium. Where the company accepts the application after receiving the first premium with it, cover also begins from the time the first premium was received.
The application must be completed by the policyholder, and the policyholder and the insured must sign it by hand. Failure to sign by hand may result in disadvantages regarding the validity of the contract. On an internet cyber-mall, an electronic signature may be used instead.
The policyholder has the right to be given and have explained the information needed about the product they wish to buy.
The insurer and N2N Insurance Brokerage must explain the important matters of the product to ordinary financial consumers.
When applying, the policyholder, the insured or their agent must disclose truthfully the facts they know regarding the questions in the application (including the questionnaire). Otherwise the claim may be declined or the contract cancelled. Where insurance is taken out by telephone or other means of communication, the duty is performed by answering the seller's questions, which are recorded, without a separate written questionnaire, so answers must be given with particular care.
If, after the contract is made, any of the following arises in respect of the subject-matter insured, the policyholder or the insured must notify the company in writing without delay and obtain endorsement on the policy.
The surrender value is the amount paid if the contract is cancelled early. Unlike bank savings, insurance combines risk protection and savings: part of the premium is paid out as claims to other policyholders who suffer accidents, and part covers the insurer's operating expenses, so the surrender value on early cancellation may be less than the premiums paid, or nil.
Under Article 59-4(1) of the Income Tax Act (special tax credit), for protection-type insurance taken out by an employee only, a tax credit of 12% of the premium paid (capped at KRW 1 million per year) is available. Tax matters may change with amendment or repeal of the relevant tax law.
Except as provided by law, the insurer and N2N Insurance Brokerage do not collect, use, inspect or provide personal data related to this contract — for its conclusion, maintenance and claim payment — without the consent of the policyholder, the insured or the beneficiary. However, for those purposes the insurer may, with the consent of the policyholder and the insured and in accordance with law, provide personal data to other insurers and insurance-related bodies.
The above is a summary and excerpt of the policy wording; for grounds on which claims are not paid and other details, please refer to the policy wording and product description.
Five by lease type — the landlord and neighbouring-harm liability area
High fire risk from kitchen and high-heat equipment. Reviewing the combination with compulsory multi-use-establishment cover is essential.
Office and retail leases. The lease often states an insurance duty.
Karaoke, internet cafés, gyms and the like. Designed in combination with the compulsory "multi-use establishment fire liability" area.
Manufacturing and logistics leases. The area with the largest single-accident loss; an excess-limit endorsement is recommended.
Apartment, multi-unit and detached-house leases. The Act on Liability for Fire Caused by Negligence applies, so assessing gross negligence is key.
At a shopping arcade, a kitchen fire at a restaurant tenant spread to two neighbouring units. The tenant held fire liability cover, and the neighbouring tenants' claims were reviewed under this wording, separate from the landlord's building fire insurance. Whether the negligence was ordinary under the Act on Liability for Fire Caused by Negligence, and whether the preservation duty under the lease had been met, became the key to assessing liability, and the neighbouring tenants' business-interruption loss was reviewed within the policy limit. A case showing the risk of loss to the landlord plus several neighbouring tenants accumulating in a single accident — and that an analysis of the neighbouring environment is essential when designing the limit.
Source: (General industry example)
The wording and structure points decision-makers most often overlook
Under the Act on Liability for Fire Caused by Negligence, a fire by ordinary negligence has limited liability, but a fire by gross negligence or a breach of the lease's preservation duty does not. The wording usually covers this, but the gross-negligence assessment becomes the key issue after a fire, so systematising fire prevention matters.
The landlord is covered for the building itself by property insurance, and the tenant for their liability by this wording. The two areas are separate, so reviewing the lease's liability-allocation clause at the application stage and matching it to the cover scope is key.
In dense neighbouring environments such as arcades, officetels and multi-use establishments, single-accident loss can accumulate across many neighbours. The base limit alone may not cover the spread, so an excess-limit endorsement and a business-interruption extension are recommended.
The questions decision-makers ask most when considering tenant fire liability insurance
Tenant fire liability itself is not generally compulsory by law, but certain sectors such as restaurants and multi-use establishments fall under the compulsory "multi-use establishment fire liability" area. For ordinary office and shop tenants it is voluntary, but the lease often states an insurance duty, so in practice it is close to essential.
Where a fire caused by the tenant's fault leads to (1) damage to the landlord's building, (2) damage to neighbouring units or buildings, (3) third-party bodily injury, and (4) consequential loss such as business interruption — these are the usual cover areas. Exclusions and limits differ by wording.
Under the Act on Liability for Fire Caused by Negligence, liability for a fire by ordinary negligence is limited. But for a fire by gross negligence, or a breach of the preservation duty under the lease, the limitation does not apply and the tenant may bear the whole loss. The wording usually covers this area, and whether the negligence was gross becomes the key issue in assessing liability after a fire.
The landlord covers loss to their own property through the building's fire (property) insurance, and the tenant covers their liability to the landlord and neighbours through this wording. The two areas are separate, so on an incident the lease's liability-allocation clause should be checked against the cover scope.
Where a fire caused by the tenant's fault spreads to neighbouring units or buildings, this is a core cover area of the wording. In dense neighbouring environments such as shopping arcades, officetels and multi-use establishments, the single-accident loss can expand greatly, so reviewing the spread of neighbouring harm is essential when designing the limit.
The limit is designed considering the leased area, the neighbouring environment (arcade, office, multi-use establishment), the value of neighbouring units and buildings, and the business-interruption risk. Compulsory areas such as multi-use establishments and restaurants carry a statutory limit, and an excess-limit endorsement is commonly combined to supplement actual loss.
The insurer assesses it on the sector (restaurant, café, office, shop), the leased area, the fire-risk grade (use of a kitchen or high-heat equipment), firefighting facilities/certification and past incident history. The exact premium and whether cover can be accepted are confirmed after underwriting by insurers such as AIG, Chubb, DB, KB, Meritz and Hyundai.
