What happens if a Benjamin Franklin Plumbing franchisee fails to maintain the required insurance?
Benjamin_Franklin_Plumbing Franchise · 2025 FDDAnswer from 2025 FDD Document
16.1.17 If you fail to maintain the insurance coverage required by Section 9, or fail to provide satisfactory evidence of insurance to us within forty-eight (48) hours of our request;
9.2. Changes. We have the right to increase the amounts of insurance coverage required and to require different or additional kinds of insurance. If you do not have the insurance required by this Agreement, we have the right (but no obligation) to obtain insurance on your behalf. If we do so, you agree to reimburse us for the cost of insurance, plus a reasonable fee for our services.
Source: Item 23 — RECEIPTS (FDD pages 88–312)
What This Means (2025 FDD)
According to the 2025 Benjamin Franklin Plumbing Franchise Disclosure Document, failure to maintain the required insurance coverage, as detailed in Section 9 of the agreement, constitutes a breach of the franchise agreement. If a franchisee fails to provide satisfactory evidence of insurance to Benjamin Franklin Plumbing within 48 hours of a request, it can lead to termination of the franchise agreement.
Benjamin Franklin Plumbing also has the right, but not the obligation, to obtain insurance on behalf of the franchisee if the franchisee fails to maintain the required insurance. If Benjamin Franklin Plumbing exercises this right, the franchisee is obligated to reimburse Benjamin Franklin Plumbing for the cost of the insurance, along with a reasonable fee for their services.
Maintaining adequate insurance is a standard requirement in franchising to protect both the franchisee and franchisor from potential liabilities. The franchisee must ensure they understand the types and minimum amounts of insurance coverage required, as specified by Benjamin Franklin Plumbing, and keep the policies current. Failure to do so not only risks potential termination of the agreement but also exposes the franchisee to potential financial liabilities in case of unforeseen events.