What entities must be named as additional insureds on Best Brains franchisee insurance policies?
Best_Brains Franchise · 2025 FDDAnswer from 2025 FDD Document
You shall purchase and maintain during the term of this Agreement insurance coverage as we may prescribe from time to time. This includes, but is not limited to, workers' compensation, comprehensive public liability and property damage, business interruption, and general and umbrella coverages. You shall maintain coverage under one or more insurance policies containing the terms, conditions, and minimum liability protection amount that we have specified. All insurance policies must be issued by insurance carriers approved by us.
We may from time to time increase the minimum amount of coverage required under any policy, and require different or additional kinds of insurance to reflect inflation, identification of new risks, changes in law or standards of liability, higher damage awards, or other relevant changes in circumstances.
All insurance policies must name the Company (and its officers, directors, managers, shareholders, members and employees) as additional insureds, must contain a waiver by the insurance carrier of all subrogation rights against Company, and must provide that we will receive thirty (30) days advance written notice of termination, expiration, cancellation, or modification of any such policy.
Prior to opening, and annually thereafter, you shall furnish us with evidence of insurance, renewal, or extension of each such insurance policy, together with evidence of payment of premiums, evidencing the required limits.
If you do not maintain insurance as required, we may, obtain such insurance and keep the same in full force and effect on your behalf. If we do, you shall reimburse the Company for all premiums and other expenses incurred by us in connection with obtaining such insurance.
Source: Item 23 — RECEIPTS (FDD pages 42–190)
What This Means (2025 FDD)
According to Best Brains' 2025 Franchise Disclosure Document, franchisees are required to secure and maintain various insurance coverages throughout the term of their agreement. These include, but are not limited to, worker's compensation, comprehensive public liability and property damage, business interruption, and general and umbrella coverages. The specific types and minimum coverage amounts are determined by Best Brains and may be adjusted over time to reflect factors like inflation or changes in liability standards.
All insurance policies obtained by the franchisee must be issued by insurance carriers approved by Best Brains. Furthermore, these policies must explicitly name "the Company (and its officers, directors, managers, shareholders, members and employees)" as additional insureds. This requirement ensures that Best Brains is protected under the franchisee's insurance policies in the event of a claim.
In addition to being named as additional insureds, the insurance policies must also include a waiver of subrogation rights against Best Brains, meaning the insurance carrier cannot pursue claims against Best Brains for any payments made under the policy. Best Brains also requires a thirty-day advance written notice of any termination, expiration, cancellation, or modification of the insurance policy. Franchisees must provide Best Brains with evidence of insurance coverage and premium payments both before opening their franchise and annually thereafter. Failure to maintain the required insurance coverage allows Best Brains to obtain insurance on the franchisee's behalf, with the franchisee responsible for reimbursing all associated costs and premiums.