Can Best Brains increase the minimum amount of insurance coverage required for franchisees?
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, Best Brains has the right to modify the required insurance coverage for franchisees during the term of the agreement.
This means that Best Brains can increase the minimum amount of coverage required under any insurance policy. They can also require different or additional kinds of insurance. These changes can be made to reflect inflation, identification of new risks, changes in law or standards of liability, higher damage awards, or other relevant changes in circumstances.
The franchisee is responsible for purchasing and maintaining insurance coverage as prescribed by Best Brains. This includes, but is not limited to, workers' compensation, comprehensive public liability and property damage, business interruption, and general and umbrella coverages. Franchisees must ensure that all insurance policies are issued by insurance carriers approved by Best Brains and that Best Brains is named as an additional insured. Additionally, Best Brains must receive thirty days' advance written notice of any termination, expiration, cancellation, or modification of any policy.
If a franchisee fails to maintain the required insurance, Best Brains has the option to obtain the insurance on the franchisee's behalf, and the franchisee will be required to reimburse Best Brains for all premiums and expenses incurred.