What is the minimum Employer's Liability insurance limit required for a Carls Jr. franchise?
Carls_Jr Franchise · 2025 FDDAnswer from 2025 FDD Document
he extent each has an insurable interest. All insurance policies must be written by an insurance company (or companies) satisfactory to us in compliance with the standards, specifications, coverages and limits set forth in the OPM or otherwise provided to you in writing.
These required insurance policies include, at a minimum, the following: (1) Commercial General Liability insurance with policy limits not less than $5,000,000 per occurrence and in the aggregate. Coverage shall apply per location, including coverage for contractual liability, broad form property damage, personal and advertising injury, product liability and completed operations, not to exclude food-borne illness, as well as Damage to Rented Premises coverage with limits not less than $100,000; (2) Automobile Liability coverage, including owned, leased, non-owned and hired vehicles, with a combined single limit not less than $1,000,000 per accident and additional liability coverage as needed for delivery services. This may be included as part of a package policy; (3) Workers' Compensation, statutory as required by law, and Employer's Liability insurance with limits not less than $500,000, and such other insurance as may be required by the state or locality in which the Franchised Restaurant is operated. This coverage shall also be in effect for all of Franchisee's employees who participate in any of the training programs described in the Franchise Agreement; The required limits in (1) – (3) above may be satisfied through a combinati
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 37–41)
What This Means (2025 FDD)
According to the 2025 Carls Jr. Franchise Disclosure Document, franchisees must maintain Employer's Liability insurance with limits not less than $500,000. This coverage is in addition to Workers' Compensation insurance, which must be statutory as required by law. The franchisee may also need to obtain other insurance as required by the state or locality in which the Franchised Restaurant is operated.
The required insurance limits, including the Employer's Liability coverage, may be satisfied through a combination of Primary and Umbrella/Excess Liability coverage. If using an Umbrella/Excess Liability coverage, it must follow the form of the underlying Commercial General Liability, Automobile Liability, and Employer's Liability coverages. This means the umbrella policy must provide the same type of coverage as the primary policies, just with higher limits.
Carls Jr. also requires franchisees to maintain other insurance policies, including Commercial General Liability insurance with policy limits not less than $5,000,000 per occurrence and in the aggregate, and Automobile Liability coverage with a combined single limit not less than $1,000,000 per accident. Franchisees must ensure they understand all insurance requirements and maintain adequate coverage to protect their business and employees.