What is the minimum aggregate limit for Commercial General Liability insurance required for a Baya Bar franchise?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
ompany. All insurance must be on an "occurrence" basis. Currently you must maintain the following insurance: (1) "Special" causes of loss coverage forms, including fire and extended coverage, crime, vandalism, and malicious mischief, on all property of the Franchised Business, for full repair and replacement value (subject to a reasonable deductible); (2) Business interruption insurance covering at least 12 months of income; (3) Commercial General Liability insurance, including products liability coverage, and broad form commercial liability coverage, written on an "occurrence" policy form in an amount of not less than $1,000,000 single limit per occurrence and $2,000,000 aggregate limit; (4) Business Automobile Liability insurance including owned, leased, non-owned and hired automobiles coverage in an amount of not less than $1,000,000; (5) Workers Compensation coverage as required by state law; and (6) any insurance required by the terms of your lease, required by law or that we may require in the future.
All insurance policies, except for workers' compensation, must name us, our affiliates and the officers, directors, shareholders, partners, agents, representatives, independent contractors, servants and employees of each of them, as additional named insureds. All insurance policies must include a waiver of subrogation in favor of us and our affiliates, must be primary and non-contributing with any insurance carried by us or our affiliates, and must stipulate th
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 20–24)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, franchisees must maintain Commercial General Liability insurance with specific coverage limits. This insurance must include products liability coverage and broad form commercial liability coverage, written on an "occurrence" policy form. The minimum required coverage is $1,000,000 single limit per occurrence and $2,000,000 aggregate limit.
This requirement means that a Baya Bar franchisee needs to secure an insurance policy that can cover up to $1,000,000 for a single incident and up to $2,000,000 for all incidents within the policy period. This protects both the franchisee and the franchisor from potential financial losses due to accidents, injuries, or damages that may occur at the franchise location or as a result of the products sold.
Baya Bar also requires that the insurance policies name the franchisor, its affiliates, and their personnel as additional insureds, with a waiver of subrogation in their favor. This is a common practice in franchising, ensuring that the franchisor is protected from liability arising from the franchisee's operations. Additionally, the franchisee must provide Baya Bar with a certificate of insurance when signing the lease or 90 days after signing the Franchise Agreement, and within ten days of each policy's renewal. Baya Bar retains the right to alter the insurance requirements during the term of the Franchise Agreement.