What is the maximum retention allowed for the Employment Practices Liability insurance for a Bft franchise?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
ased or hired/rented vehicles are used in the operation of the franchise.
- (3) Workers Compensation insurance covering all of Franchisee's employees with statutory coverage and limits as required by state law. Such insurance shall include coverage for Employer's Liability with limits not less than $500,000 each accident, $500,000 disease – each employee, and $500,000 disease – po
Source: Item 23 — RECEIPTS (FDD pages 79–265)
What This Means (2025 FDD)
According to the 2025 Bft Franchise Disclosure Document, franchisees must maintain Employment Practices Liability insurance with specific limits and retention levels. This insurance is designed to protect the franchisee from claims brought by employees alleging employment-related torts.
The required insurance policy must have a limit of not less than $1,000,000 per claim in the aggregate. The policy's retention, which is the amount the franchisee must pay out-of-pocket before the insurance coverage kicks in, cannot exceed $25,000. The policy must provide defense and coverage for employment-related claims and include third-party employment practices liability coverage.
This requirement ensures that Bft franchisees have adequate protection against potential employment-related lawsuits, which can be costly. Franchisees need to factor in the cost of this insurance, including the premium and potential retention, when assessing the overall financial investment in a Bft franchise. It is important to note that Bft reserves the right to modify these insurance requirements, potentially increasing coverage or decreasing required amounts.