What actions can Bambu take if a franchisee's insurance coverage lapses?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
Noncompliance with the insurance provisions set forth herein shall be deemed a material breach of this Agreement; in the event of any lapse in insurance coverage, in addition to all other remedies, Bambu shall have the right to demand that Franchisee cease operations of the Bambū shoppe until coverage is reinstated, or, in the alternative, pay any delinquencies in premium payments and charge the same back to Franchisee.
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, if a franchisee's insurance coverage lapses, it constitutes a material breach of the Franchise Agreement. In such an event, Bambu has the right to demand that the franchisee cease operations of the Bambū shoppe until the insurance coverage is reinstated.
Alternatively, Bambu can choose to pay any overdue premium payments to reinstate the insurance coverage. If Bambu opts to pay the franchisee's insurance delinquencies, they can then charge the amount back to the franchisee.
It is important for prospective franchisees to maintain continuous insurance coverage as required by Bambu to avoid potential business interruptions or financial burdens. Franchisees should also ensure that their insurance policies provide Bambu with a 30-day advance written notice of cancellation to allow time to rectify any potential lapse in coverage.