factual

Can the Baya Bar franchisor request a copy of the insurance policy from the franchisee?

Baya_Bar Franchise · 2024 FDD

Answer from 2024 FDD Document

n insurance for a minimum of twelve (12) months, in an amount necessary to satisfy Franchisee's obligations under this Agreement and the lease for the Franchised Business location.

  • 15.1.5 Automobile Insurance. Prior to operation of any vehicle on behalf of the Franchised Business, Franchisee must obtain comprehensive automobile liability insurance in the amount of at least a combined single limit for bodily injury and property damage of One Million Dollars ($1,000,000).
  • 15.2 Evidence of Insurance. Franchisee shall deliver to, and maintain at all times with Franchisor, current Certificates of Insurance evidencing the existence and continuation of the required coverages. In addition, if requested by Franchisor, Franchisee shall deliver to Franchisor a copy of the insurance policy or policies required hereunder.
  • 15.3 Failure to Procure. If, for any reason, Franchisee should fail to procure or maintain the insurance required by this Agreement as revised from time to time for all franchisees by the Manual or otherwise in writing, Franchisor shall have the right and authority (without, however, any obligation) to immediately procure such insurance and to charge Franchisee for the cost thereof together with a reasonable fee for Franchisor's expenses in so acting, including all attorneys' fees. Franchisee shall pay Franchisor immediately upon notice by Franchisor to Franchisee that Franchisor has undertaken such action and the cost thereof.
  • 15.4 Increase in Coverage**.** The levels and types of insurance stated herein are minimum 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 r

Source: Item 22 — CONTRACTS (FDD page 56)

What This Means (2024 FDD)

According to Baya Bar's 2024 Franchise Disclosure Document, the franchisor can request a copy of the franchisee's insurance policy. Specifically, Baya Bar requires franchisees to deliver and maintain current Certificates of Insurance evidencing the required coverages with the franchisor at all times.

In addition to providing Certificates of Insurance, Baya Bar franchisees must also provide a copy of their insurance policies if requested by the franchisor. This allows Baya Bar to verify that the franchisee has obtained and maintains the required insurance coverage.

Furthermore, Baya Bar has the right to increase the required minimum requirements for any type of insurance or add additional types of insurance requirements as the franchisor deems reasonably prudent to require. Franchisees must submit proof of coverage to Baya Bar within 30 days of any such required new limits or types of coverage.

Disclaimer: This information is extracted from the 2024 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.