Who is responsible for the expense of the insurance policy that a Belocal franchisee is required to maintain?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
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- A. Insurance. Franchisee shall procure and maintain in full force and effect at all times during the Term of this Agreement, at Franchisee's expense, an insurance policy or policies protecting Franchisee against any demand or claim with respect to personal injury, death, or property damage, or any loss, liability, or expense whatsoever arising out of or occurring at or in connection with Franchisee's operation as an independent contractor. Such policy or policies must be written by a carrier approved or required by Franchisor and must include, but not be limited to, the following:
- (1) Comprehensive General Liability Insurance, including broad-form contractual liability, broad-form property damage, personal injury, advertising injury, completed operations, products liability, and fire damage coverage, in the amount of $2,000,000 combined single limit per occurrence, $4,000,000 general aggregate.
- (2) Automobile liability coverage, including coverage of owned, non-owned, and hired vehicles, with coverage in amounts not less than $300,000, combined single limit.
- (3) Event insurance for each event Franchisee hosts or sponsors in connection with the Publication in the amount of $1,000,000 per occurrence, $2,000,000 in the aggregate, regardless of where the event is located.
- (4) Such other insurance as may be required by the state or locality in which Franchisee operates the Franchised Business.
Franchisor reserves the right, in its sole discretion, to require Franchisee to procure and maintain in full force and effect at all times during the Term of this Agreement, at Franchisee's expense, any other insurance policies or coverages that Franchisor deems necessary, as well as higher policy limits, as specified by Franchisor from time to time in writin
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, the franchisee is responsible for the expense of maintaining the required insurance policies. The FDD specifies that the franchisee must procure and maintain insurance at their own expense throughout the term of the agreement.
Belocal franchisees are required to obtain and maintain insurance policies that protect against claims related to personal injury, death, property damage, or any loss, liability, or expense arising from their operations as an independent contractor. These policies must be written by a carrier approved or required by Belocal and include comprehensive general liability insurance ($2,000,000 per occurrence, $4,000,000 general aggregate), automobile liability coverage ($300,000 combined single limit), and event insurance ($1,000,000 per occurrence, $2,000,000 in the aggregate for each event hosted or sponsored).
Furthermore, Belocal retains the right to mandate additional insurance policies or higher coverage limits, at the franchisee's expense, if deemed necessary. If a franchisee fails to maintain the required insurance, Belocal has the right to procure the insurance and charge the franchisee for it, including a reasonable fee for expenses. Belocal can also elect to reduce the compensation payable to the franchisee by an amount equal to the insurance charges. This highlights the importance of franchisees understanding and budgeting for these insurance costs to avoid potential financial strain or intervention from Belocal.