What is the charge if an Anago franchisee does not obtain insurance through the franchisor?

According to Anago's 2025 Franchise Disclosure Document, if a franchisee fails to maintain the required insurance, Anago has the right to procure the insurance and charge the franchisee for the cost of the insurance, plus interest at the maximum rate permitted by law, along with a reasonable fee for expenses incurred. This is detailed in Section 9.6 of the agreement.

Specifically, Section 3.7(a) states that subfranchisors are required to obtain insurance coverage through the Anago National Insurance program during the entire term. The required insurance includes coverage protecting the subfranchisor and Anago against loss, liability, personal injury, death, property damage, or expense arising from the subfranchisor's obligations under the agreement. The policy must name Anago as an additional insured and provide notice of any premium default or termination of coverage.

In practical terms, this means that if a franchisee chooses not to obtain insurance through Anago's National Insurance program and fails to maintain the required coverage independently, Anago can step in to secure the necessary insurance. The franchisee will then be responsible for covering the cost of the insurance, any interest accrued at the maximum legal rate, and a reasonable fee to cover Anago's expenses in obtaining the insurance. This ensures that Anago and the franchisee are protected, but it also places the financial burden of non-compliance on the franchisee.