Must the insurance policy for a Bevaris Alliance franchise cover damage to property, including the premises?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
- 13.1 Compulsory cover. The Franchisee shall take out and maintain an all-risk insurance policy or policies with a reputable insurance company (or companies) with such amount of coverage as the Franchisor may, in its absolute discretion, specify. Such policy (or policies) shall include those in the Manual and the following:
- (a) Liability for Franchisee's Business including Products and Services delivered by Franchisee to Customers.
- (b) liability for employees and third parties;
- (c) public liability;
- (d) workers compensation;
- (e) indemnity coverage;
- (f) liability for damage to property (including to the Premises, equipment and any vehicles used in the Franchisee's Business);
- (g) loss of profits and interruption of the Franchisee's Business; and
- (h) any other coverage which the Franchisor may, in its absolute discretion, specify.
- 13.2 Compliance with insurance policies. The Franchisee shall not breach, or allow any breach of, such insurance policies.
- 13.3 Franchisor's interest. The Franchisor's interest should be noted on the policies of insurance as an additional insured, and which shall state that the Franchisor is to receive notice of any late payment of a premium and at least 30 days' notice of cancellation.
- 13.4 Copies. The Franchisee shall provide the Franchisor with copies of all such policies and renewals.
- 13.5 Premiums. The Franchisee shall promptly pay all premiums for such policies and immediately provide the Franchisor with evidence of payment of premiums.
- 13.6 Failure to insure. If the Franchisee fails to take out and maintain such policies, the Franchisor may do so and the Franchisee shall reimburse the Franchisor for all costs and expenses incurred in doing so.
Source: Item 23 — RECEIPT (FDD pages 22–88)
What This Means (2024 FDD)
According to Bevaris Alliance's 2024 Franchise Disclosure Document, franchisees are required to maintain an all-risk insurance policy with a reputable insurance company. The specific amount of coverage is determined by Bevaris Alliance at its discretion. This policy must include several coverage types.
Specifically, the insurance policy must include liability coverage for the franchisee's business, covering products and services delivered to customers, as well as liability for employees and third parties. It also needs to cover public liability, workers' compensation, and indemnity coverage. Critically, the policy must include liability for damage to property, explicitly including the premises, equipment, and any vehicles used in the franchisee's business. Additionally, the policy should cover loss of profits and interruption of the franchisee's business.
Bevaris Alliance also retains the right to specify any other coverage requirements it deems necessary. Franchisees must comply with all insurance policy terms and ensure the franchisor's interest is noted on the policies as an additional insured. This ensures Bevaris Alliance receives notifications of any late premium payments or policy cancellations, with at least 30 days' notice. Franchisees are obligated to provide Bevaris Alliance with copies of all insurance policies and renewals and must promptly pay all premiums, providing evidence of payment to the franchisor.
If a franchisee fails to maintain the required insurance policies, Bevaris Alliance has the right to obtain the necessary coverage and charge the franchisee for all associated costs and expenses. This comprehensive insurance requirement protects both the franchisee and Bevaris Alliance from potential financial losses due to various liabilities and damages, ensuring the business can continue operating even in unforeseen circumstances.