Does Bombs Away require Workers Compensation coverage, and if so, how is it determined?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
pecific Obligations
The following are our current specific obligations for purchases and leases:
- A. Insurance. You must obtain insurance as described in the Franchise Agreement and in our Manual, which includes (i) Commercial General Liability insurance, including products liability coverage, and broad form commercial liability coverage, written on an "occurrence" policy form in an amount of not less than $1,000,000 single limit per occurrence and $2,000,000 aggregate limit, (ii) Business Automobile Liability insurance including owned, leased, non-owned and hired automobiles coverage in an amount of not less than $1,000,000, and (iii) Workers Compensation coverage as required by state law. Your policies (other than Workers Compensation) must list us and our affiliates as an additional insured, must include a waiver of subrogation in favor of us and our affiliates, must be primary and non-contributing with any insurance carried by us or our affiliates, and must stipulate that we receive 30 days' prior written not
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 15–17)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, franchisees are required to obtain Workers Compensation coverage. The specific requirements for this coverage are determined by state law. This means that the amount and scope of Workers Compensation insurance a Bombs Away franchisee must carry will vary depending on the state in which they operate their franchise.
In addition to Workers Compensation, Bombs Away franchisees must also secure other types of insurance. These include Commercial General Liability insurance with a minimum of $1,000,000 single limit per occurrence and $2,000,000 aggregate limit, as well as Business Automobile Liability insurance of at least $1,000,000 covering owned, leased, non-owned, and hired automobiles.
Bombs Away requires that the franchisor and its affiliates be listed as additional insureds on the franchisee's policies (excluding Workers Compensation). The policies must include a waiver of subrogation in favor of Bombs Away and its affiliates, be primary and non-contributing with any insurance carried by Bombs Away or its affiliates, and stipulate that Bombs Away receive 30 days' prior written notice of cancellation. It is standard practice in franchising to require specific insurance coverage to protect both the franchisee and the franchisor from potential liabilities.