Can Beverly Anns Cookie increase the required amounts of insurance coverage?
Beverly_Anns_Cookie Franchise · 2025 FDDAnswer from 2025 FDD Document
e for the Franchise.
We may periodically increase the amounts of coverage required under these insurance policies and/or require different or additional insurance coverage at any time. You may purchase all of your insurance through the captive insurance program offered by our affiliate, Kona Insurance. The captive insurance program is a comprehensive property and casualty insurance program covering the Beverly Ann's Cookie franchisees in the following areas: Commercial Auto Liability; Commercial Auto Physical Damage; Commercial General Liability; Property Coverage and Inland Marine; Workers Compensation; and Commercial Umbrella. The program is underwritten by Great American Insurance Group and administered by Cornerstone Insurance.
All insurance policies, except for employment liability insurance policies, must name us and any affiliates we designate as additional named insured parties and provide for 30 days prior written notice to us of a policy's material modification, cancellation, or expiration. You must furnish us with a copy of your Certificate of Insurance within ten days after the policy is issued or renewed.
Approved Products and Services
We may develop proprietary food products ("Products") and may develop and own proprietary recipes ("Proprietary Recipes"). In order to protect their trade secrets and to monitor the manufacture, packaging, processing, and sale of Products, we or our affiliate will: (i) manufacture, supply, and sell Products to Beverly Ann's Cookies franchisees; and/or (ii) disclose Proprietary Recipes to a limited number of suppliers, including our affiliate.
You must obtain services and products from: (1) designated suppliers, (2) approved suppliers, and/or (3) according to our specifications. We will issue you a list of the designated and approved suppliers. If you want to use or sell a product or service that we have not yet evaluated or if you want to purchase or lease a product or service from a supplier or provider that we have not yet approved (for services and products that require supplier approval), you must follow the policies and procedures contained in our Brand Manual. Our approval generally will be based on the supplier's ability to consistently make the manufactured product to our standards, requirements, and/or specifications; the supplier's willingness to protect our confidential information; production, delivery, and service capability to meet supply and service commitments; and other criteria detailed in the Brand Manual. We will use commercially reasonable efforts to notify you within 60 days after receiving all requested information and materials whether you are authorized to purchase or lease the product or service from that supplier or provider. Costs associated with gaining approval may be your responsibility and/or the supplier's where existing suppliers are capable of providing an existing product.
Source: Item 8 — RESTRICTIONS ON SOURCES OF SERVICES AND PRODUCTS (FDD pages 29–32)
What This Means (2025 FDD)
According to Beverly Anns Cookie's 2025 Franchise Disclosure Document, Beverly Anns Cookie retains the right to modify insurance requirements for franchisees. Specifically, Beverly Anns Cookie may periodically increase the amounts of coverage required under existing insurance policies or mandate different or additional insurance coverage at any time. This gives Beverly Anns Cookie the flexibility to respond to changing market conditions, increased risks, or other factors that may necessitate higher or different coverage levels.
Beverly Anns Cookie franchisees are obligated to obtain and maintain insurance coverage that Beverly Anns Cookie periodically requires. This insurance must be secured from a supplier with a rating of "A-" or better by Best's Insurance Reports. Currently, franchisees must maintain specific coverage levels, including workers' compensation insurance (if they have employees) of not less than $500,000 or a higher amount as required by state statute, comprehensive business automobile insurance (including physical damage for the GRM/GRT in an amount of $144,451 or greater), comprehensive general liability and product liability insurance coverage of not less than $1,000,000, and automobile (truck) vehicle liability insurance covering the driving of the GRM/GRT, Hire/Non-Owned Autos and any Additional Equipment or vehicles used in your business in an amount of not less than $1,000,000.
Beverly Anns Cookie also offers a captive insurance program through its affiliate, Kona Insurance, which franchisees may use to purchase their insurance. This program covers areas such as Commercial Auto Liability, Commercial Auto Physical Damage, Commercial General Liability, Property Coverage and Inland Marine, Workers Compensation, and Commercial Umbrella. All insurance policies, except for employment liability insurance policies, must name Beverly Anns Cookie and any designated affiliates as additional named insured parties and provide for 30 days prior written notice of any material modification, cancellation, or expiration of the policy. Franchisees must also furnish Beverly Anns Cookie with a copy of their Certificate of Insurance within ten days after the policy is issued or renewed.
For a prospective franchisee, this means that insurance costs could potentially increase over time if Beverly Anns Cookie decides to raise the required coverage amounts. It is important to factor in the potential for these changes when assessing the overall cost of operating a Beverly Anns Cookie franchise. Franchisees should also be aware of the approved insurance providers and the requirements for notifying Beverly Anns Cookie of any changes to their insurance policies.