Under what conditions might Carvel obtain a master insurance policy on behalf of the System?

According to Carvel's 2025 Franchise Disclosure Document, Carvel may obtain a master insurance policy on behalf of the entire Carvel system for certain types of coverage. If Carvel secures a master insurance policy, franchisees may be required to pay their proportionate share of the coverage. This payment would be made either to Carvel or to an Approved Supplier.

This arrangement could potentially offer franchisees cost savings or more comprehensive coverage than they might obtain individually. However, it also means franchisees would be obligated to participate in the master policy and pay their share of the premiums if Carvel chooses to implement such a program. The FDD specifies that franchisees must obtain and maintain a comprehensive business insurance program, including various liability coverages, at their own expense during the term of the Franchise Agreement.

Prospective franchisees should inquire with Carvel about the specific types of coverage that might be included in a master insurance policy, how the proportionate share of premiums would be determined, and what the potential costs and benefits of participating in such a program would be. Understanding the details of any master insurance policy is crucial for budgeting and managing risk as a Carvel franchisee.