Does All Team's minimum insurance requirement relieve franchisees of the responsibility to maintain adequate coverage?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
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. FRANCHISEE's failure to maintain coverage will not relieve FRANCHISEE of any contractual responsibility or obligation or liability under this Agreement.
Source: Item 22 — CONTRACTS (FDD pages 33–34)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, franchisees are ultimately responsible for maintaining adequate insurance coverage, regardless of the minimum requirements set by All Team. While All Team specifies minimum insurance coverage levels, it is the franchisee's duty to ensure they have sufficient coverage at all times during and after the franchise agreement. Franchisees are advised to consult with their advisors to determine if additional insurance is necessary beyond the minimums.
All Team outlines various insurance coverages franchisees must maintain, including Workers' Compensation Insurance, General Liability Insurance ($1,000,000 per occurrence and $2,000,000 in the general aggregate), Personnel Consultant's Errors and Omission Insurance ($1,000,000), Non-owned automobile insurance ($1,000,000 combined single limit), Employee Practices Liability insurance ($2,000,000 per claim and in the aggregate), Employee Dishonesty/Blanket Crime Insurance ($1,000,000 per occurrence), and a Blanket Fidelity Bond ($10,000 limit of liability). Franchisees must also maintain Excess or Umbrella Liability insurance ($5,000,000 per occurrence) and Property Insurance.
All Team retains the right to increase the required insurance coverage, and franchisees must comply within 30 days of written notice. Franchisees must provide All Team with evidence of insurance coverage annually. Failure to maintain the required insurance can result in All Team procuring insurance on the franchisee's behalf, with the franchisee responsible for reimbursement, along with a penalty of $500 per month and prohibition from operating the agency until proof of insurance is received.
Despite All Team's ability to procure insurance on behalf of the franchisee, this does not relieve the franchisee of their responsibility to maintain adequate coverage. The franchisee's failure to maintain adequate coverage will not relieve them of any contractual responsibility, obligation, or liability under the Franchise Agreement.