Who is named as the certificate holder on all insurance policies for a Burros Fries franchise?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
All insurance policies will name Franchisee as certificate holder and us and our affiliates as an additional named insured with waiver of subrogation by Franchisee for the benefit of us. We may establish minimum standards for coverage to be met by underwriters for insurance. Before beginning operations, Franchisee will obtain any other liability insurance required by law, provide us with certificates of insurance and a complete copy of all insurance policies within ten (10) days of issuance, and maintain all required insurance during the term of this Agreement. Franchisee shall also furnish us with certificates and endorsements evidencing insurance coverage within ten (10) days after each of the following events (i) at all policy renewal periods, no less often than annually and (ii) at all instances of any change to, addition to or replacement of any insurance. Lapses, alterations, or cancellations require immediate notice to us and shall, in our sole discretion, be deemed an immediate material breach of this Agreement as set forth in Section 23.C. If Franchisee fails to obtain the required insurance and to keep the same in full force and effect, we may, but shall not be obligated to, pay the premiums or acquire insurance, and bill Franchisee. Franchisee shall reimburse us for the full cost of such insurance, along with a reasonable service charge to compensate us for the time and effort expended to secure such insurance. We may change these insurance requirements on reasonable notice to Franchisee.
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2024 FDD)
According to Burros Fries's 2024 Franchise Disclosure Document, the franchisee is named as the certificate holder on all insurance policies. Additionally, Burros Fries and its affiliates are listed as an additional named insured. The franchisee is also required to provide a waiver of subrogation for the benefit of Burros Fries.
This means that while the franchisee holds the certificate, Burros Fries also has significant protection under the insurance policies. The waiver of subrogation prevents the franchisee's insurance company from pursuing Burros Fries to recover any claims paid out due to incidents at the franchise location. This is a common practice in franchising to protect the franchisor from liability related to the franchisee's operations.
The franchisee must provide Burros Fries with certificates of insurance and complete copies of all insurance policies within ten days of issuance. Furthermore, the franchisee must furnish certificates and endorsements evidencing insurance coverage within ten days after each policy renewal period (at least annually) and at all instances of any change to, addition to, or replacement of any insurance. Lapses, alterations, or cancellations require immediate notice to Burros Fries. Failure to maintain the required insurance constitutes a material breach of the Franchise Agreement, potentially leading to the franchisor acquiring insurance on behalf of the franchisee at the franchisee's expense, including a service charge.