During what period must a Canopy Lawn Care franchisee maintain the required insurance policies?
Canopy_Lawn_Care Franchise · 2025 FDDAnswer from 2025 FDD Document
- (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.
Franchisee shall also furnish Franchisor with all proof of insurance coverage required by this Section, including endorsements, within 10 days after any of the following events: (a) all policy renewals, but not less often than annually, and (b) all instances of any change to, addition to, or replacement of any insurance.
The policies and endorsements for each insurance policy are to be signed by a person authorized by that insurer to bind coverage on its behalf.
All proof of insurance is subject to approval by Franchisor.
Franchisor reserves the right to require complete, certified copies of all required insurance policies at any time in Franchisor's sole discretion.
- (d) In the event Franchisee fails to obtain the required insurance and to keep the same in full force and effect, Franchisor may, but shall not be obligated to, purchase insurance on Franchisee's behalf from an insurance carrier of Franchisor's choice, and Franchisee shall reimburse Franchisor for the full cost of such insurance, along with a reasonable service charge to compensate Franchisor for the time and effort expended to secure such insurance, within 5 days after the date Franchisor delivers an invoice detailing such costs and expenses to Franchisee.
Notwithstanding the foregoing, failure of Franchisee to obtain insurance constitutes a material breach of this Agreement entitling Franchisor to terminate this Agreement or exercise any or a combination of the other default remedies set forth in Section 17 of this Agreement.
- (e) Franchisee's obligation to obtain and maintain insurance coverage in the amounts required by Franchisor shall not be limited in any way by reason of any insurance that Franchisor may maintain, nor does Franchisee's procurement of required insurance relieve Franchisee of liability under the indemnity obligations described in Section 12.2.
Franchisee's insurance procurement obligations under this Section are separate and independent of Franchisee's indemnity obligations.
Source: Item 22 — CONTRACTS (FDD page 55)
What This Means (2025 FDD)
According to the 2025 Canopy Lawn Care FDD, franchisees must maintain required insurance coverage throughout the duration of their Franchise Agreement. Canopy Lawn Care requires franchisees to furnish proof of insurance coverage, including endorsements, within 10 days after policy renewals, at least annually, and after any changes, additions, or replacements to the insurance. All proof of insurance is subject to approval by Canopy Lawn Care.
If a franchisee fails to maintain the required insurance, Canopy Lawn Care has the option, but not the obligation, to purchase insurance on the franchisee's behalf. The franchisee would then be responsible for reimbursing Canopy Lawn Care for the full cost of the insurance, along with a reasonable service charge, within 5 days of receiving an invoice. Failure to obtain insurance constitutes a material breach of the Franchise Agreement, potentially leading to termination of the agreement and other default remedies.
The franchisee's obligation to maintain insurance coverage is independent of any insurance that Canopy Lawn Care may maintain and does not relieve the franchisee of liability under indemnity obligations. This requirement ensures that Canopy Lawn Care franchisees continuously protect their business and Canopy Lawn Care's interests through adequate insurance coverage, and that they remain compliant with the Franchise Agreement terms.