Who is responsible for the cost and expense of the required insurance for a Bens Soft Pretzels franchise?
Bens_Soft_Pretzels Franchise · 2025 FDDAnswer from 2025 FDD Document
u or your employees, including any that relate to any party making a finding of any joint employer status, you will fully indemnify us for any such loss.
C. Insurance. You must purchase and maintain in full force and effect, at your expense and from a company we accept, insurance that insures both you and us, our affiliates and any other persons we designate by name. The insurance policy or policies must be written in accordance with the standards and specifications (including minimum coverage amounts) set forth in writing by us from time to time, and, at a minimum, must include the following (except as different coverages and policy limits may be specified for all franchisees from time to time in writing): (i) "special" causes of loss coverage forms (sometimes called "All Risk Coverage" or "All Peril Coverage") on the Store, store improvements and all furniture, fixtures, equipment, supplies and other property used in the operation of the Store, for full repair and replacement value, except that an appropriate deductible clause is permitted; (ii) business interruption insurance covering a minimum of 12 months loss of income, including coverage for our Royalty Fees (for example, in the event of a fire or destruction of the premises, the insurance must cover our average royalty payments (based on the previous 12-month timeframe, or if a shorter timeframe, the total operating timeframe for the store) during the rebuilding process); (iii) comprehensive general liability insurance including product liability insurance and contractual liability insurance, with minimum limits of $2,000,000 per occurrence and $2,000,000 to $5,000,000 annual aggregate; (iv) personal and advertising injury insurance with minimum limits of $2,000,000 per occurrence; (v) fire damage coverage in an amount sufficient to cover the replacement costs of the Store equipment, improvements and betterments; (vi) medical expense coverage in the amount of $10,000 to $25,000; (vii) workers' compensation insurance covering all of your employees; (viii) employers liability insurance with contingent liability; ( ix) umbrella liability insurance; ( x) automobile liability insurance; (xi) "Per Location" aggregate limits when multiple store locations are insured under one comprehensive general liability and umbrella liability policy(cies); (xii) Ben's Soft Pretzels Franchising Corporation and its affiliates are named as additional insureds on all liability policies required by this subparagraph; (xiii) severability of interests and/or separation of insureds provisions must be included in the liability policies and an endorsement is required providing that the franchisee's insurance is primary with respect to any insurance policy carried by Ben's Soft Pretzels Franchising Corporation and its affiliates and any insurance maintained by Ben's Soft Pretzels Franchising Corporation or its affiliates is excess and non-contributing; (xiv) a waiver of subrogation endorsement must be obtained; and (xv) any other such insurance coverages or amounts as required by law or other agreement related to the Store.
The insurance coverages referenced in (iii), (iv), (vi), (vii), (viii), (ix), (x), (xi), (xii) and (xiii) must commence as of the date you sign this Agreement. The insurance coverages referenced in (i), (ii) and (v) of this subparagraph must commence as of the date construction begins at the Store. You must deliver to us at commencement and annually or at our request a proper certificate evidencing the existence of such insurance coverage and your compliance with the provisions of this subparagraph. The insurance certificate must show our status as an additional insured and provide that we will be given 30 days' prior written notice of a material change in or termination or cancellation of the policy. We also may request copies of all policies. We may from time to time modify the required minimum limits and require additional insurance coverages, by providing written notice to you, as conditions require, to reflect changes in relevant circumstances, industry standards, experiences in the BEN'S SOFT PRETZELS system, standards of liability and higher damage awards. If you do not procure and maintain the required insurance coverage required by this Agreement, we have the right, but not the obligation, to procure insurance coverage
Source: Item 22 — CONTRACTS (FDD pages 46–47)
What This Means (2025 FDD)
According to Bens Soft Pretzels's 2025 Franchise Disclosure Document, the franchisee is responsible for the cost and expense of the required insurance. The franchisee must purchase and maintain insurance, at their own expense, from a company that Bens Soft Pretzels accepts. This insurance must cover both the franchisee and Bens Soft Pretzels, including its affiliates and any other persons designated by name.
The insurance policy must adhere to the standards and specifications set by Bens Soft Pretzels, including minimum coverage amounts. The required insurance includes: special causes of loss coverage, business interruption insurance covering a minimum of 12 months loss of income (including coverage for royalty fees), comprehensive general liability insurance with minimum limits of $2,000,000 per occurrence and $2,000,000 to $5,000,000 annual aggregate, personal and advertising injury insurance with minimum limits of $2,000,000 per occurrence, fire damage coverage, medical expense coverage in the amount of $10,000 to $25,000, workers' compensation insurance, employers liability insurance, umbrella liability insurance, and automobile liability insurance.
The franchisee is also responsible for ensuring that Ben's Soft Pretzels Franchising Corporation and its affiliates are named as additional insureds on all liability policies. The franchisee's insurance must be primary with respect to any insurance policy carried by Ben's Soft Pretzels Franchising Corporation and its affiliates. Additionally, a waiver of subrogation endorsement must be obtained. These insurance coverages, with the exception of special causes of loss coverage, business interruption insurance, and fire damage coverage, must commence as of the date the Franchise Agreement is signed. The remaining coverages must commence as of the date construction begins at the store.
The franchisee must provide a certificate of insurance coverage to Bens Soft Pretzels at commencement and annually, or upon request. This certificate must show Bens Soft Pretzels' status as an additional insured and provide 30 days' prior written notice of any material change or cancellation of the policy. If the franchisee fails to maintain the required insurance coverage, Bens Soft Pretzels has the right, but not the obligation, to procure insurance coverage and charge the costs, along with a reasonable fee, to the franchisee, payable immediately upon written notice.