Who must Canopy Lawn Care franchisees name as additional insureds on their insurance policies?
Canopy_Lawn_Care Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) All insurance policies shall name Franchisor and its parent, Empower Brands, LLC, their affiliates and such other parties as Franchisor may designate, as additional insureds.
Coverage for the additional insureds shall not be limited to claims of vicarious liability.
In addition, the Franchisee's insurers shall endorse or otherwise amend the policies such that their policies: (a) are primary and non-contributory; (b) waive any right of subrogation as respects the additional insureds; and (c) provide the additional insureds 30 days' advance written notice of cancellation or other material change in coverage.
- (c) Franchisee shall provide Franchisor with original or duplicate copies of all insurance policies, including endorsements, or other proof of insurance acceptable to Franchisor evidencing coverage required by this Section, together with proof of payment within 10 days of issuance thereof.
Source: Item 22 — CONTRACTS (FDD page 55)
What This Means (2025 FDD)
According to Canopy Lawn Care's 2025 Franchise Disclosure Document, franchisees are required to include specific entities as additional insureds on their insurance policies. Specifically, Canopy Lawn Care and its parent company, Empower Brands, LLC, along with their affiliates, must be named as additional insureds. Furthermore, Canopy Lawn Care retains the right to designate other parties who must also be included as additional insureds on the franchisee's insurance policies.
This requirement ensures that Canopy Lawn Care and its related entities are protected from potential liabilities arising from the franchisee's operations. The insurance coverage for these additional insureds must not be limited to claims of vicarious liability, providing broader protection. Additionally, the franchisee's insurance policies must be endorsed to be primary and non-contributory, meaning they will be the first to respond to a claim, and the insurers must waive any right of subrogation against the additional insureds.
Moreover, the insurance policies must provide the additional insureds with 30 days' advance written notice of any cancellation or material change in coverage. This notification period allows Canopy Lawn Care and the other insured parties to take necessary steps to maintain adequate coverage in the event of a policy change or cancellation. Franchisees are also obligated to provide Canopy Lawn Care with copies of all insurance policies, including endorsements, or other acceptable proof of insurance, along with proof of payment, within 10 days of issuance.
These insurance requirements are typical in franchising, as they protect the franchisor from liabilities related to the franchisee's business operations. Franchisees should carefully review these requirements to ensure they obtain adequate insurance coverage and comply with Canopy Lawn Care's stipulations. Failure to maintain the required insurance coverage could result in a breach of the franchise agreement.