Under what condition is a Bojangles franchisee required to reimburse insurance costs?
Bojangles Franchise · 2025 FDDAnswer from 2025 FDD Document
M 6 OTHER FEES**
| 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, a franchisee is required to reimburse insurance costs if they fail to procure or maintain the required insurance, and as a result, Bojangles procures the insurance themselves. In this case, the franchisee is responsible for covering the cost of procuring the insurance, as well as any expenses incurred by Bojangles in doing so.
This condition is fairly standard in franchising, as franchisors need to ensure that all franchise locations maintain adequate insurance coverage to protect the brand and the system as a whole. By requiring franchisees to reimburse insurance costs in the event of non-compliance, Bojangles is incentivizing franchisees to maintain the necessary coverage.
The reimbursement is due upon demand, meaning Bojangles can request immediate payment from the franchisee. This could create a financial burden for the franchisee if they are unable to pay promptly. It is important for prospective franchisees to understand the insurance requirements outlined in the Franchise Agreement and to ensure they can consistently meet these requirements to avoid incurring additional costs.