Does each insurance policy for a Browns Chicken franchise need to name Brown as an additional insured?

According to Browns Chicken's 2025 Franchise Disclosure Document, each insurance policy must name Brown as an additional insured on a primary basis. This requirement is part of the insurance obligations that franchisees must adhere to during the term of the franchise agreement.

Naming Brown as an additional insured protects the franchisor from potential liabilities related to the franchisee's operations. It ensures that Browns Chicken can directly benefit from the franchisee's insurance coverage in the event of a claim. Additionally, the insurance policy must provide Browns Chicken with ten days' prior written notice of any material modification, cancellation, or expiration of the policy, allowing the franchisor to take necessary actions to maintain continuous coverage.

This requirement is a standard practice in franchising, as it allows the franchisor to mitigate risks associated with the franchisee's business activities. Franchisees must ensure they obtain insurance policies that meet this specific requirement to comply with the franchise agreement. Failure to do so could result in Brown obtaining the insurance on behalf of the franchisee and charging the franchisee for the costs, including an additional administration fee.

Prospective Browns Chicken franchisees should carefully review the insurance requirements outlined in the Franchise Agreement and consult with insurance providers to secure appropriate coverage that includes Brown as an additional insured. Maintaining the required insurance is crucial for remaining in compliance with the franchise agreement and protecting both the franchisee and the franchisor from potential financial losses.