If a Bojangles franchisee fails to maintain the required insurance, what are the financial obligations to Bojangles?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
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| Type of Fee1 | Amount | Due Date | Comments |
|---|---|---|---|
| Audit | Deficiencies in amounts owed, plus interest | Payable upon invoice. | You also must pay all costs and expenses connected with the audit if an audit reveals an understatement of 5% or more. |
Source: Item 6 — OTHER FEES (FDD pages 21–24)
What This Means (2025 FDD)
According to Bojangles's 2025 Franchise Disclosure Document, if a franchisee fails to procure or maintain the required insurance, Bojangles has the right to procure the insurance themselves. In this case, the franchisee is responsible for reimbursing Bojangles for the cost of procuring the insurance, as well as any expenses Bojangles incurs in doing so. This reimbursement is due upon demand.
This means that a Bojangles franchisee must ensure they consistently maintain the insurance coverage required by the franchise agreement. Failure to do so not only puts the franchisee at risk but also creates a financial obligation to Bojangles. The franchisee will have to pay for the insurance Bojangles obtains on their behalf, potentially without having a say in the choice of provider or the cost of the policy.
Franchisees should carefully review the insurance requirements outlined in the Franchise Agreement and consult with insurance professionals to ensure they understand and can meet these obligations. Maintaining proper insurance is a standard requirement in franchising, designed to protect both the franchisee and the franchisor from potential liabilities and financial losses. Failing to do so can lead to unexpected expenses and potential breaches of the franchise agreement.