What are the B Bops franchisee's obligations regarding insurance coverage for the franchise premises?
B_Bops Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee shall procure and maintain at Franchisee's own expense during the Term of this Agreement insurance coverage for the Franchise as specified by Company from time to time in the Operations Manual. Each policy of insurance shall be issued by an insurance carrier acceptable to Company that is legally authorized to do business in the state in which the Franchise Premises is located and shall name Company and B-Bop's, Inc. as additional insureds. All of such policies shall provide for a minimum of thirty (30) days written notice to Company prior to cancellation, termination, nonrenewal or change of such insurance. Company shall be entitled on an annual basis to impose reasonable increases in the minimum
liability coverage requirements and to require at any time on reasonable prior notice to Franchisee different or additional types of coverage to reflect inflation, changes in standards of liability or higher damage awards in liability litigation or other relevant factors. A copy of each of the said policies, or appropriate evidence thereof, and any renewals thereof, shall be delivered to and remain in the possession of Company. Franchisee agrees to report all losses to Company within ten (10) days of such loss, whether or not such loss is covered by the policies in force. Franchisee's performance of the obligations imposed under this Section 14 shall not relieve Franchisee of the indemnification obligation imposed by Section 15 hereof.
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2025 FDD)
According to B Bops's 2025 Franchise Disclosure Document, franchisees must secure and maintain insurance coverage for the franchise at their own expense throughout the term of the agreement. The specific coverage details are determined by B Bops and outlined in the Operations Manual, which B Bops can modify over time.
The insurance policies must be issued by a carrier acceptable to B Bops and legally authorized to operate in the state where the franchise is located. B Bops and B-Bop's, Inc. must be named as additional insureds on each policy. Furthermore, the insurance policies must provide B Bops with a minimum of thirty days' written notice before any cancellation, termination, nonrenewal, or changes to the coverage.
B Bops has the right to reasonably increase the minimum liability coverage requirements annually and can also require different or additional types of coverage to reflect factors like inflation or changes in liability standards. Franchisees must provide B Bops with copies or evidence of the insurance policies and any renewals. Franchisees are also obligated to report any losses to B Bops within ten days of the event, regardless of whether the loss is covered by insurance.
It's important to note that fulfilling these insurance obligations does not relieve the franchisee of their indemnification responsibilities, meaning they are still liable for any losses or damages related to the franchise's operation.