What is the notification timeframe required to Boulder Designs if there is a cancellation or material change in the franchisee's insurance policy?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
All insurance policies procured and maintained by Franchisee pursuant to this Agreement shall (a) name Franchisor as an additional insured; (b) waive any right to assert a claim back against Franchisor; and (c) undertake to notify Franchisor 30 days in advance of any cancellation or material change in the policy. Franchisee must provide Franchisor with certificates of coverage at least annually. If Franchisee fails to provide the certificate of insurance, Franchisor (in addition to all other rights and remedies) may purchase such insurance in the name of and on behalf of Franchisee, and Franchisee shall immediately reimburse Franchisor's expenses and premiums paid to obtain such insurance.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Boulder Designs' 2025 Franchise Disclosure Document, franchisees must provide Boulder Designs with 30 days' advance notice of any cancellation or material change to their insurance policy. This requirement ensures that Boulder Designs is aware of any potential lapse in coverage and can take steps to protect its interests.
This notification period allows Boulder Designs time to ensure continuous coverage, either by requiring the franchisee to reinstate or modify the policy or, if the franchisee fails to do so, by obtaining insurance on behalf of the franchisee. The franchisee is then responsible for reimbursing Boulder Designs for the expenses and premiums paid for this insurance.
Maintaining adequate insurance coverage is a standard requirement in franchising, designed to protect both the franchisee and franchisor from potential liabilities and losses. The 30-day notification period provides a reasonable timeframe for Boulder Designs to address any insurance-related issues and maintain compliance with the franchise agreement. Franchisees should ensure they understand and adhere to this requirement to avoid potential penalties or disruptions to their business operations.