When obtaining commercial general liability insurance, does the Burger King franchise agreement require franchisees to name BKC as an additional insured, and if so, what specific language must be used in the endorsement?
Burger_King Franchise · 2025 FDDAnswer from 2025 FDD Document
use or duplicate any of the knowledge, know-how and expertise received from BKC for any use other than for the operation of franchised BURGER KING Restaurants. Franchisee, therefore, warrants that during the Term of this Agreement, it will utilize its best and continuing efforts to promote and develop the business at the Franchised Restaurant and during the Term hereof and at all times thereafter will not directly or indirectly engage in the operation of any restaurant, other than the Franchised Restaurant and other BURGER KING Restaurants franchised from BKC, which utilizes or duplicates the BURGER KING System, any trade secrets of BKC, the BURGER KING Marks or the present or any former BURGER KING Current Image.
13. INSURANCE; INDEMNIFICATION
A. Insurance
Franchisee shall procure, or cause to be procured, prior to the opening of the Franchised Restaurant, and maintain, or cause to be maintained, in full force and effect from and following the Commencement Date and during the Term of this Agreement, at the Franchisee's expense, an insurance policy or policies protecting Franchisee and BKC (and any other entity that BKC reasonably requests) and their respective officers, directors, partners, agents and employees, against any loss, liability or expense.
B. Specific Coverage
(1) Such policy or policies shall be written by an insurance company approved in writing by BKC in accordance with the standards and specifications set forth by BKC in the MOD Manual or otherwise in writing, and shall include, at a minimum (except as additional coverages and higher policy limits that may reaso
Source: Item 22 — CONTRACTS (FDD pages 125–127)
What This Means (2025 FDD)
According to Burger King's 2025 Franchise Disclosure Document, franchisees are required to obtain commercial general liability insurance and name BKC (Burger King Corporation) as an additional insured. The required insurance must have a primary and excess limit of not less than $5,000,000 per occurrence, covering bodily injury, death, personal injury, property damage, non-owned automobile, blanket contractual, and products and completed operations liability. The annual aggregate liability limit varies based on the number of Burger King restaurants the franchisee and its affiliates own. For 1-10 restaurants, the limit is $5,000,000 per year; for 11-50 restaurants, it is $10,000,000 per year; and for more than 50 restaurants, it is $20,000,000 per year.
To ensure BKC and other entities are properly added as additional insureds, the franchisee's insurance policy must include a specific endorsement. The endorsement must use the following language: "BKC, its parent company, its officers, employees, directors, and Affiliates", without any language limiting coverage. This precise wording is mandatory to ensure the correct scope of coverage for Burger King and its related parties.
For the purposes of insurance requirements, if the Managing Owner of a Burger King franchisee is also the Managing Owner of another Burger King franchise, those franchises are considered affiliates. This affiliation affects the determination of the required annual aggregate liability limit, potentially increasing the amount of coverage needed based on the total number of restaurants owned by affiliated entities. Franchisees should consult with their insurance providers to ensure they meet these specific requirements and maintain adequate coverage throughout the term of their franchise agreement.