What is the relationship required between the insurance afforded to additional insureds and any other insurance available to Canine Dimensions Franchising, LLC?

According to Canine Dimensions' 2025 Franchise Disclosure Document, the insurance coverage provided to Canine Dimensions Franchising, LLC as an additional insured on the franchisee's policy must act as the primary insurance coverage. This means that in the event of a claim, the franchisee's insurance policy must be the first one to respond and pay out, without relying on any other insurance or self-insurance that Canine Dimensions Franchising, LLC might have.

This requirement protects Canine Dimensions by ensuring that the franchisee's insurance is the first line of defense in covering potential liabilities. It also means that Canine Dimensions' own insurance policies or self-insurance arrangements are not affected unless the franchisee's coverage is exhausted or insufficient to cover the claim.

For a prospective Canine Dimensions franchisee, this implies a potentially higher insurance premium, as the policy must provide primary coverage to the franchisor. It is important for franchisees to understand this requirement and to shop for insurance policies that meet these specific terms to avoid any gaps in coverage or potential breaches of the franchise agreement. Franchisees should consult with insurance professionals experienced in franchise insurance to ensure they obtain appropriate coverage that satisfies Canine Dimensions' requirements.

Failing to maintain the required insurance coverage could result in the franchisee being in breach of the franchise agreement, potentially leading to penalties or even termination of the franchise agreement. Therefore, understanding and complying with these insurance requirements is crucial for the franchisee's business operations and relationship with Canine Dimensions.