Premises Liability

Premises liability is the core liability exposure for every apartment building owner. Under premises liability law, the property owner has a legal duty to maintain the property in a reasonably safe condition and to warn of or correct hazards that the owner knows about or should have discovered through reasonable inspection. The scope of this duty varies by jurisdiction, but apartment owners generally owe the highest duty of care to tenants and invited guests, and a lesser (but still significant) duty to licensees and, in some states, even trespassers.

The most frequent premises liability claims against apartment owners involve trip-and-fall or slip-and-fall injuries caused by defective walkways, inadequate lighting, wet lobby floors, icy parking lots, or broken stairs. Swimming pool injuries, playground accidents, elevator malfunctions, dog attacks in common areas, and criminal assaults attributed to negligent security also generate substantial premises liability claims. Each of these scenarios tests whether the owner knew of the hazard, had a reasonable opportunity to correct it, and failed to act.

The commercial general liability policy provides the primary coverage for premises liability claims. The CGL policy pays defense costs and indemnity (settlements or judgments) up to the per-occurrence and aggregate limits. Apartment owners with significant premises liability exposure—high-rise buildings, properties with pools or fitness centers, buildings in high-crime areas—should carry general liability limits of at least $1 million per occurrence and $2 million aggregate, supplemented by a commercial umbrella policy providing additional limits of $5 million or more depending on the property's size and risk profile.