In a ruling that has sent ripples through the commercial real estate sector, the Ohio Eighth District Court of Appeals affirmed on September 25, 2025, a lower court’s decision denying coverage to a property owner under their tenant’s liability policy following a fatal shooting at an Akron bar. The case, involving Nationwide General Insurance Company, highlights critical vulnerabilities in how landlords rely on tenant insurance for protection, potentially leaving owners exposed to multimillion-dollar claims if contracts and endorsements aren’t airtight.
The decision in Nationwide General Insurance Co. v. Lockett underscores a harsh reality: Without explicit written agreements designating landlords as additional insureds or evidence of hands-on property management, owners may find themselves uncovered in tenant-related incidents. As commercial property disputes rise amid urban violence and economic pressures, this “Nationwide win” serves as a wake-up call for landlords nationwide, emphasizing the need for proactive policy reviews and clear lease clauses to bridge these risk gaps.
The Case Breakdown: A Fatal Shooting and Coverage Clash
The dispute stemmed from a tragic December 2022 shooting at The Office Bar in Akron, Ohio, where a gunman killed one patron and injured another during a packed Friday night. The bar’s owner, defendant Lockett, operated under a business owners policy (BOP) from Nationwide, which included general liability coverage up to $1 million per occurrence.
Lockett, as the tenant, leased the space from a property owner (also a defendant) who sought defense and indemnity under the policy after being named in a wrongful death suit. Nationwide, however, denied coverage, arguing the landlord didn’t qualify as an “insured” under the policy’s terms. The insurer filed for declaratory judgment in March 2024, seeking a court ruling that it owed no duty to defend or indemnify.
The trial court granted summary judgment for Nationwide in early 2025, finding no evidence of a written lease requiring Lockett to name the owner as an additional insured, nor proof the landlord “actively managed” the premises—a policy prerequisite for automatic inclusion. The appeals court upheld this on September 25, clarifying that mere ownership isn’t enough; explicit contractual language or operational involvement is key.
This outcome aligns with standard commercial liability policies, where tenants’ insurance often limits landlord protections to “additional insured” endorsements—clauses that must be negotiated and documented.
Risk Gaps Exposed: Why Landlords Are Vulnerable
The ruling spotlights several “risk gaps” that could ensnare commercial property owners in similar disputes:
- Lack of Additional Insured Status: Without a lease mandating tenants to add landlords to policies, owners default to their own coverage, which may exclude tenant-caused incidents or cap at lower limits. In this case, the absence of such a clause left the owner reliant on potentially inadequate personal policies.
- Passive Ownership Pitfalls: Policies like Nationwide’s BOP require “active management” (e.g., maintenance oversight) for landlords to qualify as insureds. Pure “absentee” owners—common in multi-tenant setups—fall short, exposing them to full liability in lawsuits.
- Incident-Specific Exclusions: Shootings, assaults, or other violent acts often trigger “assault and battery” exclusions in tenant policies, shifting burden back to landlords unless waived.
- Rising Claim Costs: Wrongful death suits average $1-5 million in settlements, per Jury Verdict Research, far exceeding many basic landlord policies’ $500,000-1 million limits.
These gaps are amplified in 2025’s litigious climate: Urban violence claims rose 15% year-over-year, per the Insurance Information Institute, while economic strains push tenants toward cost-cutting, skimping on robust coverage.
| Risk Gap | Common Issue | Potential Exposure | Mitigation Tip |
|---|---|---|---|
| No Additional Insured Clause | Lease omits requirement for tenant policy endorsement | Full lawsuit costs ($1M+) | Mandate in every lease; verify certificates annually |
| Passive Management | Owner uninvolved in daily ops | Denied “insured” status | Document involvement (e.g., inspections) or negotiate waivers |
| Exclusions for Violence | Policy bars assault claims | Uninsured tenant incidents | Seek endorsements; carry umbrella policy ($2M+) |
| Inadequate Limits | Tenant policy caps too low | Gap between tenant and owner coverage | Require minimum $1M liability; audit policies quarterly |
Industry Reactions: A Wake-Up for Property Owners
Legal experts are sounding alarms. “This decision is a stark reminder that ‘set it and forget it’ leasing won’t cut it anymore,” said Akron-based attorney Maria Gonzalez in a Law.com interview. Nationwide’s win bolsters insurers’ defenses, potentially leading to stricter underwriting and higher premiums for commercial landlord policies—up 12% in Ohio since 2024.
Tenant advocates, however, point to root causes: Underinsured bars and nightclubs, often in economically distressed areas, heighten risks. The Ohio Restaurant Association called for state grants to bolster security, tying into broader debates on urban safety funding.
On social platforms, #LandlordLiability trended with 20K posts: Real estate pros shared lease templates, while small owners vented frustrations over “unfair exposure.” One X user quipped: “Nationwide’s ‘win’ is every landlord’s loss—time to lawyer up those leases.”
Why U.S. Landlords Should Act Now: Broader Implications
For American property owners—from strip mall magnates to urban apartment tycoons—this ruling amplifies vulnerabilities in a $2 trillion commercial real estate market strained by post-pandemic shifts and rising claims. With violence incidents up 18% in public venues (FBI data), disputes like this could surge, eroding profits and inviting personal liability.
Economically, it pressures insurers: Nationwide’s victory may inspire similar denials, hiking premiums 10-15% for high-risk tenants like bars. Politically, it fuels calls for tort reform in states like Ohio, where caps on non-economic damages remain debated.
Lifestyle impact? Owners face sleepless nights over lawsuits, but proactive steps—like annual policy audits—can safeguard peace of mind. For tenants, it’s a nudge toward comprehensive coverage, fostering safer spaces.
Forward Focus: Bridging the Gaps
The Nationwide win isn’t just a court footnote—it’s a clarion call for landlords to fortify contracts and coverage. As tenant insurance disputes proliferate, savvy owners will prioritize endorsements and management proofs, turning risk gaps into armored shields. In commercial real estate’s unforgiving arena, ignorance isn’t bliss—it’s bankruptcy.
By Sam Michael
September 30, 2025
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