What is the minimum limit for employment practices liability insurance required for a Bonchon franchise, and is a claims-made policy form acceptable?

According to Bonchon's 2025 Franchise Disclosure Document, franchisees are required to maintain employment practices liability insurance with a minimum limit of $250,000. The document specifies that a claims-made policy form is acceptable for this type of insurance.

This requirement means that Bonchon franchisees must secure insurance coverage that protects them against claims related to employment practices, such as wrongful termination, discrimination, or harassment. The $250,000 limit indicates the minimum amount the insurance policy must cover per claim. The acceptance of a claims-made policy form means that the policy will only cover claims that are made while the policy is active, which is a common type of insurance policy but requires continuous coverage to ensure protection against potential future claims.

Franchisees should understand the terms and conditions of their employment practices liability insurance, including the coverage period, exclusions, and claims process. Maintaining the required insurance is critical, as failure to do so constitutes a material breach of the Franchise Agreement, potentially leading to termination of the agreement by Bonchon.