What is the minimum single-limit coverage amount required for comprehensive general liability and comprehensive motor vehicle insurance that Benihana franchisees must maintain?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
assignee sign an Assignment and Assumption Agreement in the form attached as Exhibit E hereto.
11.9 BNC's consent to a transfer of any interest in the franchise license granted herein or in Franchisee will not be a waiver of any claims BNC may have against the transferring party or a waiver of BNC's right to demand exact compliance by the transferee with any terms of this Agreement.
ARTICLE 12. INSURANCE AND INDEMNIFICATION
- 12.1 Franchisee must obtain and maintain throughout the Franchise Term insurance coverage (including without limitation, broad form comprehensive general liability coverage, products liability coverage, business interruption coverage, and employers' liability insurance) as required under this Agreement or applicable law. Franchisee must obtain BNC's approval of all insurance contracts before entering into any such contracts.
- 12.2 Each insurance policy obtained by Franchisee must name BNC and any affiliates designated by BNC as additional insureds. BNC will have the right to reasonably consent to the types and amounts of insurance cov
Source: Item 23 — Receipts (FDD pages 74–576)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, franchisees must maintain specific insurance coverage throughout the franchise term. This includes broad form comprehensive general liability coverage, products liability coverage, business interruption coverage, and employers' liability insurance, as required by the agreement or applicable law. Benihana requires approval of all insurance contracts before they are finalized.
The insurance policies must name Benihana and any designated affiliates as additional insureds. Benihana retains the right to reasonably consent to the types and amounts of insurance coverage and the issuing companies. Specifically, franchisees must maintain comprehensive general liability insurance and comprehensive motor vehicle insurance with single-limit coverage of at least $5,000,000 for personal and bodily injury, death, and property damage. This coverage applies to claims caused by or occurring in conjunction with the operation of the restaurant or the franchisee's business conduct.
In addition to the liability coverage, franchisees are required to obtain all-risk building and contents insurance, including coverage for fire, flood, earthquake, vandalism, and theft, sufficient to cover the replacement value of the restaurant and its contents. They must also maintain business interruption insurance adequate to reestablish normal business operations. Builders' risk insurance is required during any remodeling of the restaurant.
Benihana franchisees must provide certificates of insurance for all required policies immediately after issuance, as well as copies of any amendments or cancellations. Failure to maintain the required insurance allows Benihana to purchase the insurance and charge the franchisee 105% of the cost to cover the insurance and administrative expenses.