Can the insurance policies and limits described in Exhibit E for Bumper Man limit the indemnification obligations under the Franchise Agreement?
Bumper_Man Franchise · 2025 FDDAnswer from 2025 FDD Document
(a) Minimum Requirements. Franchisee must obtain and maintain in effect for the Bumper Business the insurance policies set forth in Exhibit E, as may be amended by Franchisor from time to time. These insurance policies and limits described in Exhibit E will not limit, and are independent of, the indemnification obligations under this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 45–180)
What This Means (2025 FDD)
According to Bumper Man's 2025 Franchise Disclosure Document, the insurance policies and limits outlined in Exhibit E do not limit the franchisee's indemnification obligations under the Franchise Agreement. The insurance requirements are independent of these indemnification responsibilities. This means that even if a franchisee has the required insurance coverage, they are still fully responsible for covering any losses, expenses, or claims for which they are obligated to indemnify Bumper Man.
This provision is significant for prospective Bumper Man franchisees because it clarifies that insurance coverage does not provide a cap or a substitute for their indemnification duties. Franchisees must understand that their personal assets may be at risk if claims or liabilities exceed their insurance coverage.
Bumper Man also requires franchisees to secure certain minimum insurance coverages, including Garage Liability Insurance with a $1,000,000 limit per occurrence, Garage Keepers Insurance with a $50,000 limit per vehicle, and Commercial Vehicle Insurance with a $500,000 combined single limit. Franchisees must provide proof of insurance to Bumper Man and acknowledge that these are minimum requirements, with the option to buy additional coverage as deemed necessary. Franchisees also release Bumper Man from any claims relating to the procurement of insurance, including claims that Bumper Man did not require the franchisee to procure adequate insurance.
In summary, while franchisees must maintain specific insurance policies, these policies do not reduce or eliminate their separate and distinct obligations to indemnify Bumper Man for various claims and liabilities as defined in the Franchise Agreement.