What is the Beverly Anns Cookie borrower's responsibility regarding equipment selection?
Beverly_Anns_Cookie Franchise · 2025 FDDAnswer from 2025 FDD Document
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If this box is marked, then under the terms of your Loan, you are required to carry adequate insurance coverage on financed equipment. Your insurance certificate is required prior to us funding your vendor. Homeowners Policies will not cover commercial financing. YOUR LOAN MAY NOT BE FUNDED UNTIL WE RECEIVE THIS INFORMATION.
Please provide a Certificate of Insurance showing the following:
- Above referenced Agreement #
- Name of the Insurance Company and Policy Number
- Effective and Expiration Date of Coverage.
- INSURED PARTY: The Borrower(s) listed above must be named as Insured.
- PHYSICAL DAMAGE INSURANCE: Lender must be named Loss Payee against any loss including fire, theft and any other standard peril normally covered under a commercial policy for an amount not less than the replacement cost of the equipment.
- LENDER AS LOSS PAYEE/ADDITIONAL INSURED
- DESCRIPTION OF EQUIPMENT: A description of equipment covered (including serial numbers) must be listed on or attached to the Certificate of Insurance.
Source: Item 22 — CONTRACTS (FDD page 57)
What This Means (2025 FDD)
The 2025 Beverly Anns Cookie Franchise Disclosure Document outlines the franchisee's responsibilities when acquiring equipment, particularly when financing is involved. If a franchisee obtains a loan to finance equipment, they may be required to carry adequate insurance coverage on the financed equipment. Prior to funding the vendor, the franchisee must provide a certificate of insurance. Homeowners insurance policies are insufficient for commercial financing. The loan may not be funded until this information is received.
The certificate of insurance must include specific details such as the referenced agreement number, the name of the insurance company and policy number, the effective and expiration dates of coverage, and the borrower(s) listed as the insured party. Additionally, the lender must be named as the loss payee against any loss, including fire, theft, and other standard perils covered under a commercial policy, for an amount not less than the replacement cost of the equipment. A description of the equipment covered, including serial numbers, must be listed on or attached to the certificate of insurance.
For franchisees considering financing, this means they need to secure appropriate commercial insurance and provide detailed documentation to the lender before the loan can be funded and equipment acquired. This ensures that the equipment is protected against potential losses and that the lender's investment is secured. Franchisees should factor in the time and cost associated with obtaining this insurance when planning their initial investment and financing arrangements with Beverly Anns Cookie.