Where are the currently required insurance policies, coverage requirements, and coverage amounts designated for Bang Cookies franchisees?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
The currently required insurance policies, insurance coverage requirements, and insurance coverage amounts are designated and set forth in the operations manual. Franchisor may, in Franchisor's Reasonable Business Judgment, periodically change the amounts of coverage required under such insurance policies and require different or additional kinds of insurance at any time, including excess liability insurance, to reflect inflation, identification of new risks, changes in law or standards of liability, higher damage awards or other relevant changes in circumstances. Notwithstanding the immediately foregoing sentence, Franchisor shall not increase such minimum coverage more than once every two years. All public liability and property damages policies must contain a provision that Franchisor is entitled to recover under these policies on any loss occasioned to Franchisor, Franchisor's affiliates, Franchisor's successors and assigns, and the officers, directors, shareholders, members, owners, partners, agents, representatives, independent contractors, and employees of Franchisor by reason of the negligence of Franchisee and/or Franchisee's officers, directors, shareholders, members, owners, partners, agents, representatives, independent contractors, and employees.
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, the specific details regarding required insurance policies, coverage requirements, and coverage amounts for franchisees are outlined in the operations manual. Bang Cookies retains the right to modify these insurance requirements periodically, but no more than once every two years. These changes can include adjusting coverage amounts or requiring different or additional kinds of insurance to reflect factors like inflation, new risks, legal changes, or higher damage awards.
Franchisees are obligated to maintain insurance policies that protect them and also name Bang Cookies (including its affiliates, successors, assigns, officers, directors, shareholders, partners, agents, representatives, independent contractors, and employees) as additional insureds. These policies must cover personal injury, death, property damage, or any loss, liability, or expense related to the franchised business. The insurance must be written by carriers with an AM Best Rating of at least A-, VII and be reasonably acceptable to Bang Cookies.
It is standard practice in franchising for the operations manual to contain detailed specifications like insurance requirements. Prospective Bang Cookies franchisees should carefully review the operations manual to understand the specific types and amounts of insurance they will need to secure, as well as the approved insurance carriers. Franchisees must also provide Bang Cookies with copies of insurance certificates, and policies must provide at least 30 days' notice to Bang Cookies in case of material alterations or cancellation. Failure to maintain the required insurance allows Bang Cookies to procure insurance on the franchisee's behalf and charge the franchisee for all associated costs and fees.