Who are the premiums for the required insurance coverages payable to for a Chatime franchise?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
Premiums are payable to the insurance provider.
We currently require that you maintain the following insurance coverages: A) general liability coverage with minimums of $1 million per occurrence, $2 million general and products/completed operations aggregate, $1 million personal/advertising injury, $50,000 rented premises damage, and $5,000 medical expenses; B) franchisee commercial auto insurance with a $1 million combined single limit; C) workers compensation insurance with coverage limits of $1 million for bodily injury by disease per accident, $1 million policy limit, and $1 million per employee, regardless of state laws and cannot exclude owner-operators; D) property/business interruption coverage business personal property, tenant improvements, equipment, business interruption, and franchisor royalties, for a minimum of 12 months' actual loss sustained; E) cyber liability insurance with minimum coverage limits of $250,000 per occurrence and $250,000 aggregate; F) employment practices liability insurance with minimum coverage limits of $500,000 per occurrence and $500,000 aggregate, which includes third party liability and wage & hour coverage of at least $25,000, with a maximum deductible that does not exceed $25,000; G) crime insurance with a minimum coverage of $100,000 for each claim.
Insurance(10) | $3,000 to $6,000 | As arranged | As incurred | Third party
Source: Item 7 — Estimated Initial Investment (FDD pages 17–22)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, the premiums for the required insurance coverages are payable to the insurance provider.
Chatime requires franchisees to maintain several insurance coverages, including general liability coverage with minimums of $1 million per occurrence and $2 million general and products/completed operations aggregate. Franchisees also need $1 million personal/advertising injury, $50,000 rented premises damage, and $5,000 medical expenses coverage. Additionally, Chatime mandates franchisee commercial auto insurance with a $1 million combined single limit and workers' compensation insurance with $1 million coverage limits for various injury categories.
Further insurance requirements include property/business interruption coverage for business personal property, tenant improvements, equipment, business interruption, and franchisor royalties, for a minimum of 12 months' actual loss sustained. Cyber liability insurance with minimum coverage limits of $250,000 per occurrence and aggregate is also required. Lastly, franchisees must have employment practices liability insurance with minimum coverage limits of $500,000 per occurrence and aggregate, including third-party liability and wage & hour coverage of at least $25,000, with a maximum deductible that does not exceed $25,000, and crime insurance with a minimum coverage of $100,000 for each claim. The estimated initial investment for insurance ranges from $3,000 to $6,000.