Must a Baya Bar franchisee's insurance policies be satisfactory to the franchisor?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
requirements. Franchisor reserves the right to raise the required minimum requirements for any type of insurance or add additional types of insurance requirements as Franchisor deems reasonably prudent to require. Within thirty (30) days of any such required new limits or types of coverage, Franchisee must submit proof to Franchisor of Franchisee's coverage pursuant to Franchisor's requirements.
- 15.5 Additional Insured. All required insurance policies shall name Franchisor and their affiliates and their members, officers, agents and employees as additional insureds as their interests may appear. All public liability policies shall contain a provision that the additional insureds, although named as insureds, shall nevertheless be entitled to recover under such policies on any loss caused by Franchisee or Franchisee's servants, agents or employees.
- 15.6 Indemnification. TO THE FULLEST EXTENT PERMITTED BY LAW, FRANCHISEE AGREES TO EXONERATE AND INDEMNIFY AND HOLD HARMLESS BAYA BAR FRANCHISE SYSTEMS, LLC, BAYA BAR, LLC, AND ANY OF THESE COMPANIES' PARENT COMPANY, SUBSIDIARIES, DIVISIONS, AFFILIATES, SUCCESSORS, ASSIGNS AND DESIGNEES AS WELL AS THEIR DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, SHAREHOLDERS, SUCCESSORS, DESIGNEES AND REPRESENTATIVES (COLLECTIVELY REFERRED TO AS THE "BAYA BAR INDEMNITEES"), FROM ALL CLAIMS BASED UPON, ARISING OUT OF, OR IN ANY WAY RELATED TO FRANCHISEE'S FRANCHISE AND/OR THE OPERATION THEREOF, INCLUDING BUT NOT LIMITED TO, ANY CLAIM IN CONNECTION WITH FRANCHISEE'S EMPLOYEES OR AGENTS; FRANCHISEE'S COMPUTER SYSTEMS; FRANCHISEE'S PREPARATION, STORAGE, HANDLING AND/OR DISPOSAL OF FOOD OR BEVERAGE PRODUCTS; THE FRANCHISED BUSINESS PREMISES; OR FRANCHISEE'S ADVERTISING OR BUSINESS PRACTICES. FRANCHISEE AGREES TO PAY FOR ALL BAYA BAR INDEMNITEES' LOSSES, EXPENSES (INCLUDING, BUT NOT LIMITED TO ATTORNEYS' FEES) OR CONCURRENT OR CONTRIBUTING LIABILITY INCURRED IN CONNECTION WITH ANY ACTION, SUIT, PROCEEDING, INQUIRY (REGARDLESS OF WHETHER THE SAME IS REDUCED TO JUDGMENT OR DETERMINATION), OR ANY SETTLEMENT THEREOF FOR THE INDEMNIFICATION GRANTED BY FRANCHISEE HEREUNDER. THE BAYA BAR INDEMNITEES SHALL HAVE THE RIGHT TO SELECT AND APPOINT INDEPENDENT COUNSEL TO REPRESENT ANY OF THE BAYA BAR INDEMNITEES IN ANY ACTION OR PROCEEDING COVERED BY THIS INDEMNITY. FRANCHISEE AGREES THAT TO HOLD THE BAYA BAR INDEMNITEES HARMLESS, FRANCHISEE WILL REIMBURSE THE BAYA BAR INDEMNITEES AS THE COSTS AND EXPENSES ARE INCURRED BY THE BAYA BAR INDEMNITEES.
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16. TRANSFERS
- 16.1 Transfers by Franchisor.
Source: Item 22 — CONTRACTS (FDD page 56)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, a franchisee must provide proof of insurance coverage to Baya Bar that meets the franchisor's requirements within 30 days of any changes to required coverage limits or types. Baya Bar also reserves the right to increase minimum insurance requirements or add new types of insurance as deemed reasonably prudent.
Baya Bar franchisees must maintain current certificates of insurance with the franchisor as evidence of the required coverages. If requested, the franchisee must also provide a copy of the insurance policies to Baya Bar. Should a franchisee fail to maintain the required insurance, Baya Bar has the right, but not the obligation, to procure the insurance and charge the franchisee for the cost, including a reasonable fee and attorney's fees.
All required insurance policies must name Baya Bar and its affiliates, members, officers, agents, and employees as additional insureds. Public liability policies must include a provision allowing the additional insureds to recover under the policies for any loss caused by the franchisee or their staff. Prior to operating any vehicle for the Baya Bar business, franchisees must obtain comprehensive automobile liability insurance with a combined single limit of at least $1,000,000 for bodily injury and property damage.
These stipulations ensure that Baya Bar is protected from potential liabilities arising from the franchisee's operations. The franchisee bears the responsibility for maintaining adequate insurance coverage that satisfies Baya Bar's evolving requirements, and failure to do so can result in the franchisor procuring insurance on the franchisee's behalf at the franchisee's expense.