Where are the insurance carrier requirements prescribed for a Budget licensee?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
- 9.4 Insurance.
Licensee will maintain such insurance, in such minimum amounts, and with such carriers as approved by Budget in its sole discretion or, as are prescribed in the Standards and in this Paragraph 9.4.
Licensee will annually provide a current certificate of insurance to Budget naming Budget and its affiliates as additional insureds as prescribed by Budget in the Standards, and the insurer must waive any subrogation rights it may have against Budget.
Budget may periodically increase the amounts of insurance carried by Licensee and require different or additional kinds of insurance to reflect inflation, changes in standards of liability, higher damages, Licensees specific claims history or other relevant circumstances.
Budget reserves the right to receive an administrative fee or commission for its endorsement of certain insurance carriers and/or programs for the sale of supplemental liability and related insurance to rental customers.
Source: Item 23 — RECEIPTS (FDD pages 80–426)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, the insurance requirements for licensees are detailed in Paragraph 9.4 of Item 23 and in the Standards. Budget has the authority to approve insurance carriers and set minimum coverage amounts at its discretion.
Budget licensees must provide an annual certificate of insurance, naming Budget and its affiliates as additional insureds. The insurance carrier must also waive any subrogation rights against Budget. This protects Budget from potential liabilities related to the licensee's operations.
Budget retains the right to increase insurance coverage amounts or require different types of insurance to reflect factors like inflation, liability standards, claims history, or other relevant circumstances. Additionally, Budget may receive administrative fees or commissions for endorsing specific insurance carriers or programs related to supplemental liability coverage sold to rental customers.
Prospective franchisees should carefully review Paragraph 9.4 and the Standards referenced in Item 23 to fully understand the specific insurance requirements, approved carriers, and coverage levels mandated by Budget. Understanding these requirements is crucial for budgeting and maintaining compliance throughout the franchise agreement.