Whom must All Team franchisees name as additional insured on general liability insurance policies?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
going to place licensed medical professionals, FRANCHISEE will need to obtain additional professional liability insurance which will be described in greater detail in the Manual.
FRANCHISEE agrees to comply with any of changes to the insurance requirements, at FRANCHISEE's sole cost and expense. All general liability insurance policies will name ATFC, its affiliates and its successors and assigns, and National Accounts (as applicable) as additional insured and will provide that ATFC must receive thirty (30) days prior written notice of any termination, expiration or cancellation of the insurance policy. Each year FRANCHISEE must provide ATFC with a certificate or other evidence of FRANCHISEE's compliance with the insurance requirements. If FRANCHISEE fails to maintain such insurance, ATFC may procure such insurance on FRANCHISEE's behalf and will be entitled to reimbursement from FRANCHISEE for ATFC's costs to do so, in addition to any other rights and remedies ATFC may have under this Agreement. However, ATFC is not obligated to obtain such insurance on FRANCHISEE's behalf. In any event, FRANCHISEE will be charged a penalty of $500 per month and prohibited from operating the Agency until the required Certificate of Insurance is received by ATFC. Regardless of the amounts set forth above, it will be FRANCHISEE's responsibility to maintain adequate insurance coverage at all times during the term of and after the expiration of this Agreement. FRANCHISEE recognizes that the levels of insurance described above are merely a minimum requirement. FRANCHISEE should determine if additional insurance is necessary through consultation with its advisors.
Source: Item 22 — CONTRACTS (FDD pages 33–34)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, franchisees are required to name specific entities as additional insured on their general liability insurance policies. Specifically, All Team franchisees must include ATFC (All Team Franchise Corporation), its affiliates, successors, and assigns as additional insured parties. Furthermore, if the franchisee is servicing National Accounts, they must also include these National Accounts as additional insured parties on their general liability insurance policies.
This requirement ensures that All Team and related entities are protected from potential liabilities arising from the franchisee's operations. By being named as additional insured, these parties can directly benefit from the franchisee's insurance coverage in the event of a claim. This is a common practice in franchising, as it provides an added layer of security for the franchisor and any associated national accounts, ensuring they are shielded from financial risks linked to the franchisee's business activities.
The franchisee is responsible for maintaining this insurance coverage and providing All Team with proof of compliance. Failure to maintain the required insurance can result in penalties, including a $500 per month fine and a prohibition from operating the agency until the required certificate of insurance is received by ATFC. This underscores the importance of adhering to the insurance requirements outlined in the franchise agreement to avoid operational disruptions and financial penalties. Franchisees should consult with their insurance advisors to ensure they meet all necessary coverage requirements.
Moreover, franchisees must also maintain the insurance required by any National/Regional Account customer and add the National/Regional Account customer and All Team Franchise Corporation as additional insureds. This obligation highlights the importance of understanding and adhering to the specific insurance demands of National/Regional Accounts to maintain good standing and avoid potential damages. Violations of these requirements can result in financial penalties, starting at $1,000 for the first violation and escalating to $5,000 for the third violation, potentially leading to the franchisee being prohibited from servicing National/Regional Accounts.