What is the consequence for a Beggars Pizza franchisee if they fail to obtain or maintain the required insurance?
Beggars_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
If you fail to obtain or maintain the insurance required by the Franchise Agreement for any reason, we have the right and authority (without, however, any obligation to do so) to procure the insurance coverage on your behalf. You must pay us the full premium paid plus an administrative surcharge of 10% if we do so.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 15–18)
What This Means (2025 FDD)
According to Beggars Pizza's 2025 Franchise Disclosure Document, if a franchisee fails to obtain or maintain the required insurance, Beggars Pizza has the right, but not the obligation, to procure the insurance coverage on behalf of the franchisee.
If Beggars Pizza chooses to obtain insurance on the franchisee's behalf, the franchisee is responsible for paying Beggars Pizza the full premium paid for the insurance. In addition to the premium, the franchisee must also pay Beggars Pizza an administrative surcharge of 10% of the premium amount.
This means that a Beggars Pizza franchisee could face significant financial burden if they fail to maintain the required insurance, as they would be responsible for the cost of the insurance premium plus an additional 10% surcharge. It is crucial for prospective franchisees to understand and budget for the cost of insurance to avoid this potential penalty.