If Baya Bar purchases insurance on behalf of a franchisee, what fee is added to the cost?

According to Baya Bar's 2024 Franchise Disclosure Document, if a franchisee fails to obtain the required insurance coverage, Baya Bar has the right, but not the obligation, to purchase insurance on the franchisee's behalf. If Baya Bar exercises this right, the franchisee is responsible for reimbursing Baya Bar for the cost of the insurance.

In addition to reimbursing the cost of the insurance, Baya Bar also charges an administrative fee. This administrative fee is equal to 10% of the insurance cost.

This policy ensures that Baya Bar franchisees maintain adequate insurance coverage, protecting both the franchisee and the franchisor from potential liabilities. However, it also places the financial burden on the franchisee to reimburse Baya Bar for the insurance costs and the additional 10% administrative fee if the franchisee fails to secure insurance independently.