How is the insurance expense paid for a 1-800-GOT-JUNK? franchise?
1_800_Got_Junk Franchise · 2025 FDDAnswer from 2025 FDD Document
Insurance (Note 8) $10,000 $30,000 As arranged As incurred Insurance provider
8) You must obtain and maintain at all times during the term of your franchise the types of insurance policies or coverage and the minimum policy limits or maximum deductibles of any policy as specified in the Operations Manual (“Coverages”), which are apt to change from time-to-time. This estimate includes your initial insurance expenses, but you must continually maintain insurance coverage in such amounts as we specify. You must also maintain at all times all insurance policies as required by the law in which your Franchised Business is operated. You must name us and our affiliates, agents, representatives, shareholders, directors, officers and employees as additional insureds on all policies of insurance, and include a waiver of subrogation against these additional insureds. The following are our current minimum requirements for Coverages:
Type Coverage Comprehensive Liability Not less than $2,000,000 per occurrence Business Interruption As required by Franchisor Vehicle Liability Not less than $1,000,000 or as required by Franchisor Employer’s Liability Insurance As required by Franchisor; not less than $1,000,000 Umbrella Coverage Not less than $2,000,000 Worker’s Compensation As required by state law Primary and Noncontributory Endorsement
Blanket Contractual Liability Endorsement
Other As required by Franchisor
Source: Item 7 — Estimated Initial Investment (FDD pages 17–21)
What This Means (2025 FDD)
According to 1-800-GOT-JUNK?'s 2025 Franchise Disclosure Document, franchisees must obtain and maintain specific types and amounts of insurance coverage throughout the franchise term. The FDD specifies that insurance expenses, estimated between $10,000 and $30,000, are paid as arranged with the insurance provider and are incurred as needed.
1-800-GOT-JUNK? requires franchisees to maintain certain minimum insurance coverages, which may change over time as specified in the Operations Manual. These coverages include comprehensive liability (not less than $2,000,000 per occurrence), business interruption (as required by the franchisor), vehicle liability (not less than $1,000,000 or as required by the franchisor), employer’s liability insurance (not less than $1,000,000 or as required by the franchisor), umbrella coverage (not less than $2,000,000), and worker’s compensation (as required by state law). Additionally, franchisees must secure a Primary and Noncontributory Endorsement and a Blanket Contractual Liability Endorsement.
Furthermore, 1-800-GOT-JUNK? requires that the franchisor and its affiliates be named as additional insureds on all insurance policies, including a waiver of subrogation against these additional insureds. Franchisees must also maintain all insurance policies as required by the laws governing the operation of their franchised business. The initial estimate includes initial insurance expenses, but franchisees must continually maintain the specified insurance coverage amounts. Prospective franchisees should carefully review the insurance requirements and factor these costs into their financial planning.