Leased goods: who insures what (contract, deductible, claims)?

For an SME, incorporating leased assets (equipment, machinery, vehicles) can preserve cash flow while providing access to critical tools. However, this financing method raises essential questions for managing risk : who insures what , what contractual coverage should be provided , what deductibles apply , and how should a claim be documented ?

This guide allows you to clarify insurance responsibilities (tenant vs landlord), understand the impacts of deductibles in your contracts, and implement a structured approach to managing leased assets in your decision-making processes (CFO, executive, HR).

1. Understanding the framework: leasing and responsibilities

1.1. What is a leased asset?

A lease agreement is a contract by which one party (the lessor) temporarily transfers the use of an asset to another (the lessee) , in exchange for rent payments, without transferring ownership. The lessor retains legal ownership of the asset, and the lessee assumes its use according to the terms defined by the contract.

In Switzerland, the nature and obligations of insurance for these goods are not defined by a single law but derive from the leasing contract and its relationship with the professional insurance policies taken out by the company.

1.2. Why is insurance crucial for a leased asset?

Because the asset does not belong to the company but is critical to its business, the contract generally requires the lessee to take out insurance for:

• protect the landlord's investment;

• avoid disproportionate financial liability in the event of damage;

• comply with contractual clauses which may impose specific levels of coverage.

2. Who is responsible for what: distribution of responsibilities

2.1. Typical Tenant Obligations

In most leasing contracts , the lessee must take out and maintain insurance covering the risks associated with the leased asset :

• physical damage (fire, accident, vandalism, etc.);

• theft or loss;

• civil liability related to the use of the property;

• sometimes specific coverages such as "all risks" insurance or business interruption insurance if the asset immobilizes the business.

This obligation is often formalized in a standard clause "insurance of the leased asset", which also requires mentioning the lessor as an interested party in the insurance.

2.2. Role of the landlord

The landlord:

• remains the legal owner of the property;

• can verify the compliance of the insurance policies taken out by the tenant and require certain minimum guarantees;

• may in some cases offer group or collective insurance on behalf of the tenant (contractual terms to be negotiated).

On the other hand, the landlord does not directly ensure the ordinary or accidental use of the property : this generally remains the responsibility of the tenant, unless a specific clause is stipulated.

2.3. Before signing: points to consider in the contract

When negotiating a leasing contract, clearly document:

• who pays the insurance premium ;

• the level of guarantees required ;

• the obligations to provide proof of insurance to the landlord;

• the contractual consequences of a lack of or insufficient coverage.

3. Contract, deductible and claim: the fundamentals

3.1. Deductible: what it means in insurance

The deductible is the portion of the claim that remains the responsibility of the tenant/insured before the insurer intervenes . It is defined in the insurance contract and applies at the time of a claim.

In the context of a rented property:

• the higher the deductible, the lower the premium can be – but the higher your potential liability in the event of a claim;

• The deductible may vary depending on the type of risk (fire, theft, collision, etc.).

This parameter must be managed contractually to balance exposure and costs.

3.2. Documentation required for a claim

To receive compensation and comply with the lease agreement, you must accurately document the incident (see the "What to Document" box below). This documentation is crucial to avoid compensation denials due to omissions.

3.3. Claims Reporting Procedure

Create an internal checklist to trigger the declaration as soon as an event occurs:

• notification to the insurance company within the contractual time limit;

• proof of possession and use of the property at the time of the loss;

• technical reports or expert opinions if required;

• exchanges with the landlord regarding reciprocal obligations.

4. Guidelines and checklist

What needs to be documented

• copy of the leasing contract and insurance clauses;

• proof of subscription and insurance certificate covering the property;

• photographs and condition reports before and after the disaster;

• findings or reports from the authorities, if applicable;

• quotes or invoices for repair/replacement;

• written exchanges with the landlord and the insurer.

Decision-making checklist

| Key steps | Required document | Internal contact |

| Pre-contract | Contract with insurance clauses | Management / Legal |

| Subscription | Insurance certificate naming the landlord | CFO / insurance |

| Annual monitoring | Coverage compliance verification | CFO / insurance |

| Claim | Complete file with evidence + statement | Transactions / Insurance |

5. Common mistakes and how to avoid them

5.1. Relying on generic insurance without verification

Mistake : thinking that business property insurance is sufficient without checking the landlord's requirements.

Solution : Review the lease agreement and align your policies with these requirements.

5.2. Ignoring franchises

Mistake : neglecting the impact of deductibles on your claim cost.

Solution : arbitrate between franchise vs. premium in your risk scenarios.

5.3. Poor documentation of evidence

Error : filing late or without complete evidence.

Solution : use documentation templates as soon as the asset is put back in place.

6. 10 Questions to Ask Your Insurer/Broker

1. Does the insurance contract explicitly cover leased goods?

2. Is the landlord named as an interested party on the certificate?

3. What deductibles apply depending on the different risks?

4. How is damage assessed for a rented property?

5. What does the contract cover in the event of total loss of the property?

6. Are there any minimum coverage requirements imposed by the landlord?

7. What documentary evidence is required for a claim?

8. What is the procedure for reporting a claim to the landlord and the insurer?

9. What are the typical compensation periods for this type of property?

10. How can these assets and their insurance be integrated into a risk management dashboard ?

Mini case studies

Case 1 — Rented production machine

A small business leases a critical production machine. A serious breakdown occurs, resulting in significant material damage. Thanks to comprehensive business insurance covering this leased asset and structured documentation of the incident (photos, technical reports), the claim is settled and repair costs are covered after application of a deductible defined in the contract.

Case 2 — Professional scanner on lease

A small business uses a specialized scanner under a lease agreement. The scanner is damaged during internal transport. The contract requires machine breakdown insurance, naming the lessor as the beneficiary. Complete documentation and adherence to the deductible clauses allow for prompt compensation, preventing a prolonged service interruption.

Conclusion

For a manager, CFO, or HR director of an SME, mastering leased asset insurance is a key element of financial and operational management . This involves understanding who insures what, negotiating balanced clauses, structuring your evidence, and tracking claims with discipline. A methodical approach promotes business continuity and manages financial risks .

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