Can Amerispec Inspection Services franchisees obtain insurance from insurers other than the approved vendors?
Amerispec_Inspection_Services Franchise · 2025 FDDAnswer from 2025 FDD Document
We have approved vendors for E&O Insurance; however, you may also obtain insurance from another insurer at a rate determined by the insurer so long as it meets our minimum requirements and is reviewed and approved by us.
Amounts listed are for annual premiums; however, rates vary state to state.
Your premiums will be based on the state in which you are located, revenue estimates of the inspectors, additional endorsements, the number of inspectors or inspections, years of retro coverage, and claims history.
We do not represent that our minimum insurance requirements will be sufficient for your business; we recommend that you consult a qualified insurance broker to discuss your insurance needs.
Source: Item 7 — Estimated Initial Investment (FDD pages 18–20)
What This Means (2025 FDD)
According to Amerispec Inspection Services' 2025 Franchise Disclosure Document, franchisees are not strictly limited to the franchisor's approved insurance vendors. While Amerispec Inspection Services does have approved vendors for Errors and Omissions (E&O) Insurance, franchisees have the option to obtain insurance from other insurers. However, this is conditional upon the insurance meeting Amerispec Inspection Services' minimum requirements and receiving their review and approval.
The FDD specifies that the estimated initial investment for insurance ranges from $3,950 to $6,200, representing annual premiums. However, these rates can vary significantly from state to state. The actual premium a franchisee pays will depend on several factors, including the state in which the business operates, revenue estimates of the inspectors, any additional endorsements, the number of inspectors or inspections conducted, the years of retro coverage, and the claims history.
Amerispec Inspection Services explicitly states that its minimum insurance requirements may not be sufficient for every franchisee's business needs. Therefore, the franchisor recommends that prospective franchisees consult with a qualified insurance broker to discuss their specific insurance requirements. This suggests that franchisees should carefully assess their individual risk profiles and ensure they have adequate coverage, potentially exceeding the minimums set by Amerispec Inspection Services, to protect their business adequately.