How much business interruption/extra expense coverage is required under the property insurance for a Bft franchise?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
ry, premises liability, third party property damage and bodily injury liability (including death).
- (2) Automobile Liability insurance covering liability arising out of Franchisee's use, operation or maintenance of any auto (including owned, hired, and non-owned autos, trucks or other vehicles) in connection with its ownership and operation of the franchise, with limits not less than the minimum compulsory requirements in Franchisee's state. This requirement only applies to the extent that owned, l
Source: Item 23 — RECEIPTS (FDD pages 79–265)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, franchisees must maintain property insurance that includes business interruption/extra expense coverage. This coverage must have limits not less than twelve months of rent.
This requirement ensures that if a Bft studio is temporarily unable to operate due to property damage (e.g., fire, natural disaster), the insurance will cover the ongoing rent expenses for up to a year. This helps the franchisee avoid falling behind on lease payments while the studio is being repaired or rebuilt.
In addition to the business interruption coverage, the property insurance must be written on a special causes of loss coverage form with limits not less than the current replacement cost of the Studio's business personal property (including furniture, fixtures and equipment) and leasehold improvements (tenant improvements). The property insurance shall also include glass coverage with limits not less than $25,000, and signage coverage with limits not less than $10,000. Franchisees should consult with an insurance professional to determine the appropriate level of coverage for their specific circumstances and location.