What is the Franchisee required to do to protect Burros Fries and its affiliates against losses and costs?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
proval requests; andadminister the System Advertising Fund.
13. OBLIGATIONS OF FRANCHISEE RELATING TO INSURANCE
A. Overall Coverage Required
Before Franchisee opens a Burros & Fries Franchised Business, Franchisee must purchase insurance coverage from a responsible carrier with a performance rating of A or higher as rated in the most recent edition of Best Insurance Reports (or comparable criteria as we may specify) and Franchisee must maintain such insurance throughout the duration of the initial term of the Franchise Agreement and any renewal terms. Franchisee shall list us as additional insured on all its insurance policies. Franchisee will procure and maintain general liability insurance with a minimum policy limit of $2,000,000 per occurrence and $4,000,000 aggregate (this policy should include general tort, premises damage, personal advertising injury and product liability insurance which covers Franchisee for damages that result in injury from products Franchisee distributes). Plus, property and casualty insurance with a minimum policy limit of $2,000,000 or an amount specified by the us.
Franchisee must also procure and maintain "All Risks" or "Special Form" insurance (coverage for the full cost of replacement of the premises and all other property); employer liability insurance, automobile liability insurance with coverage of owned and hired vehicles with minimum coverage in amounts not less than $100,000 combined single limit for bodily and property damage (or what is in accordance with Franchisee's state guidelines); business interruption insurance to fully insure loss of earnings for a period of one-hundred and eighty (180) days or longer as may specify; and statutory workers' compensation insurance with limits of greater than $100,000 or the minimum limits required by law.
For any construction, renovation, refurbishment or remodeling of the site, Franchisee must require that the general contractor maintain, with an approved insurer, commercial general liability insurance (with comprehensive automobile liability coverage for both owned and non-owned vehicles, builders risk, product liability and independent contractor's coverage) with limits of no less than $1,000,000 per claim, naming Franchisee and us as additional insureds, as their interests may appear, together with workers' compensation and employer's liability insurance as required by law and as required by the lease. It is Franchisee's responsibility to obtain certificates of insurance from the contractor prior to the initiation of any construction.
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2024 FDD)
According to the 2024 Burros Fries Franchise Disclosure Document, franchisees have several obligations to protect Burros Fries and its affiliates from potential losses and costs. Franchisees must secure and maintain specific insurance coverage throughout the franchise term. This includes general liability insurance with a minimum policy limit of $2,000,000 per occurrence and $4,000,000 in aggregate, covering general tort, premises damage, personal advertising injury, and product liability. Additionally, franchisees need property and casualty insurance with a minimum policy limit of $2,000,000 or as specified by Burros Fries.
Franchisees must also obtain and maintain "All Risks" or "Special Form" insurance for the full replacement cost of the premises and all other property. They are required to have employer liability insurance, automobile liability insurance with minimum coverage of $100,000 combined single limit for bodily and property damage (or as per state guidelines), business interruption insurance to cover loss of earnings for at least 180 days, and statutory workers' compensation insurance with limits greater than $100,000 or the minimum required by law. Franchisees must list Burros Fries as an additional insured on all insurance policies.
Furthermore, franchisees must comply with all laws and rules regarding credit card transactions and protect the privacy of credit card users, adhering to the Payment Card Industry Data Security Standards (PCI Compliant). Franchisees are obligated to forward any notices, inspection reports, or communications from governmental entities indicating a failure to meet governmental standards or a lack of compliance with applicable laws to Burros Fries within five days of receipt. Franchisees also agree to indemnify Burros Fries under Section 18 of the Franchise Agreement for any claims arising from their failure to fulfill these obligations. These measures collectively ensure that franchisees take responsibility for potential risks and liabilities, safeguarding the interests of Burros Fries and its affiliates.