What notice must the insurance policy provide to Bumper Man in case of modification, cancellation, or expiration?
Bumper_Man Franchise · 2025 FDDAnswer from 2025 FDD Document
At least two weeks prior to the date you commence operations of your Bumper Business, you must obtain the required insurance. Insurance costs are highly dependent on the geographical location of your Bumper Business, the dollar amount of your inventory, the type of vehicle you own and other factors. Within 30 days prior to the expiration of any such policy, you will deliver to us evidence of renewal of such insurance in the form of certificates evidencing coverage. The insurance carrier must be rated A+ or better by A.M. Best Company and be authorized to transact business in the state where the Bumper Business premises is located. All policies must be primary and non-contributory to any other insurance that we have procured for ourselves and provide for 30 days' prior written notice to us of any material modification, cancellation, or expiration of such policy.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 15–18)
What This Means (2025 FDD)
According to Bumper Man's 2025 Franchise Disclosure Document, the insurance policy obtained by the franchisee must provide Bumper Man with 30 days' prior written notice in the event of any material modification, cancellation, or expiration of the policy. This requirement ensures that Bumper Man is informed of any changes to the franchisee's insurance coverage, allowing them to take necessary actions to protect their interests.
This requirement is fairly standard in franchising, as franchisors typically want to ensure that franchisees maintain adequate insurance coverage to protect the brand and the entire franchise system from potential liabilities. By requiring prior notice, Bumper Man can verify that the franchisee's insurance remains in effect and meets the franchisor's minimum requirements.
Furthermore, the FDD specifies that franchisees must provide evidence of insurance renewal to Bumper Man in the form of certificates evidencing coverage within 30 days prior to the expiration of any policy. The insurance carrier must have an A+ rating or better from A.M. Best Company and be authorized to conduct business in the state where the Bumper Business is located. These stipulations help Bumper Man ensure that franchisees are using reputable and financially stable insurance providers.