Can Apricot Lane modify the minimum insurance limits required of franchisees?

According to Apricot Lane's 2025 Franchise Disclosure Document, the company has the right to modify the minimum insurance limits required of franchisees. The FDD states that "Minimum insurance limits may be modified, as conditions require, by written notice to you." This means that Apricot Lane can increase or decrease the required coverage levels based on changing circumstances.

Apricot Lane franchisees must maintain several types of insurance, including comprehensive general liability insurance ($1,000,000 per occurrence, $2,000,000 general aggregate), automobile liability coverage ($1,000,000 combined single coverage), an umbrella policy ($1,000,000 excess coverage), worker's compensation insurance (as required by law), personal property insurance ($75,000 or higher), and business interruption insurance (greater of actual loss or $50,000). They must also carry stop gap coverage, stretch endorsements, and any other insurance required by state or local laws. These policies must be written by an insurance company licensed in the state where the franchisee operates and have an "A" rating classification in Best's Key rating guide.

This ability to modify insurance requirements gives Apricot Lane flexibility to respond to changes in the business environment, such as increased litigation risk or changes in insurance market conditions. However, it also means that franchisees could face unexpected increases in their insurance costs during the term of their franchise agreement. Franchisees should factor in the potential for these changes when assessing the overall cost of investing in an Apricot Lane franchise. It is also important to note that if a franchisee fails to maintain the required insurance, Apricot Lane has the right to procure the insurance coverage and charge the franchisee for the cost, plus a reasonable fee.