What does 'Insurance' refer to in the context of Budget's rental agreements?
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.
- 9.5 Loss Damage Waiver.
Licensee will make readily available to each customer the option to effect the waiver of any claim against such customer for collision or certain other damage to the rented Vehicle, notwithstanding any collision or comprehensive insurance deductible amount, subject to such conditions and limitations as are prescribed in the Standards and/or as are contained in the Standard Rental Agreement and the requirements of applicable law.
Licensee may charge a reasonable, additional fee for such waiver.
- 9.6 Standard Rental Agreement.
In connection with all rentals of Vehicles, Licensee will use the then-current, "Standard Rental Agreement" designated by Budget for use in the applicable jurisdiction in which the Territory is located, or such other rental agreement that has been approved by Budget in writing.
Source: Item 23 — RECEIPTS (FDD pages 80–426)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, franchisees are required to maintain insurance coverage. Budget has the authority to approve the insurance carriers and set minimum coverage amounts, as detailed in Paragraph 9.4 and the Standards. Franchisees must provide Budget with an annual certificate of insurance, naming Budget and its affiliates as additional insured parties, and ensuring the insurer waives any subrogation rights against Budget.
Budget retains the right to adjust the required insurance amounts and types to account for factors like inflation, changes in liability standards, increased damages, the franchisee's claims history, or other relevant conditions. Additionally, Budget may receive fees or commissions for endorsing specific insurance carriers or programs related to supplemental liability and related insurance sold to rental customers.
In addition to the franchisee's required insurance, Budget franchisees must offer customers the option to waive any claims against them for collision or certain other damages to the rented vehicle, regardless of any collision or comprehensive insurance deductible. Franchisees can charge an additional fee for this waiver. This waiver, along with other terms, must be included in the standard rental agreement designated by Budget.