Can Bft change the insurance requirements for franchisees?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor reserves the right, from time to time, in its discretion, to upgrade the insurance requirements or lower the required amounts as to policy limits, deductibles, scope of coverage, or rating of carriers in response to current industry standards, market conditions and/or landlord requirements.
Within sixty (60) days of receipt of notice from Franchisor, Franchisee agrees to revise its coverage, as specified in any notice from Franchisor.
Source: Item 23 — RECEIPTS (FDD pages 79–265)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, Bft retains the right to modify insurance requirements for its franchisees. Bft can adjust policy limits, deductibles, the scope of coverage, or the required rating of insurance carriers. These changes can be made in response to current industry standards, market conditions, or landlord requirements.
If Bft decides to change the insurance requirements, franchisees must revise their coverage within 60 days of receiving notice from Bft. Franchisees are also obligated to ensure their insurance policies are written by a company licensed in the state where they operate and that the insurance company has an "A" Rating Classification as indicated in A.M. Best's Key Rating Guide.
Bft also reserves the right to designate or require pre-approval of the insurance provider used by the franchisee. Franchisees must provide Bft with certificates of coverage annually. Failure to maintain the required insurance coverage can result in immediate termination of the franchise agreement, making it crucial for franchisees to stay compliant with Bft's insurance stipulations.
These stipulations are fairly standard in franchising, allowing Bft to protect its brand and manage risk effectively. Franchisees should be aware of these potential changes and factor in the cost of adjusting their insurance coverage as required by Bft.