Is a Checkers franchisee required to name Checkers and its affiliates as additional insured on all insurance policies?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
All insurance policies must: (1) be issued by carriers we approve with an A.M. Best Rating of not less than A VII; (2) contain such types and minimum amounts of coverage,
exclusions and maximum deductibles as we prescribe from time to time; (3) name us and our affiliates as additional insured; (4) provide for 30 days' prior written notice to us of any material modification, cancellation or expiration of such policy; (5) provide a waiver of subrogation in favor of us and our affiliates; and (6) include such other provisions as we may require. The minimum amount of liability coverage we prescribe in no way limits your liability to those minimum amounts. We may periodically increase the amounts of coverage required under these insurance policies and/or require different or additional insurance coverage (including reasonable excess liability insurance) at any time to reflect inflation, identification of new risks, changes in law or standards of liability, higher damage awards or other relevant changes in circumstances. These insurance policies must be primary to and without right of contribution from any other insurance policy purchased by us, our affiliates and our respective directors, officers, employees, shareholders, members, agents, successors and assigns (collectively, "indemnitees"); must not limit or reduce coverage for you if there is a claim by us or any one or more of the other indemnitees; and must extend to and provide indemnity for all of your indemnification obligations to us and the other indemnitees.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 39–44)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, franchisees are required to name Checkers and its affiliates as additional insured on all insurance policies. This requirement is part of a broader set of stipulations Checkers places on the insurance policies franchisees must maintain.
In addition to being named as additional insured, all insurance policies must be issued by carriers that Checkers approves and that have an A.M. Best Rating of not less than A VII. The policies must also contain the types and minimum amounts of coverage, exclusions, and maximum deductibles that Checkers prescribes. Furthermore, Checkers requires a 30-day prior written notice for any material modification, cancellation, or expiration of a policy, as well as a waiver of subrogation in favor of Checkers and its affiliates. The policies must also include any other provisions that Checkers may require.
Checkers also states that the minimum amount of liability coverage they prescribe does not limit the franchisee's liability to those minimum amounts. Checkers retains the right to periodically increase the required coverage amounts or require different or additional insurance coverage to reflect inflation, new risks, changes in law, higher damage awards, or other relevant changes. These insurance policies must be primary and without right of contribution from any other insurance policy purchased by Checkers, its affiliates, and their respective directors, officers, employees, shareholders, members, agents, successors, and assigns. The policies must not limit or reduce coverage for the franchisee if there is a claim by Checkers or any of the other indemnitees and must extend to and provide indemnity for all of the franchisee's indemnification obligations to Checkers and the other indemnitees.
These requirements ensure that Checkers has adequate protection against potential liabilities arising from the operation of the franchised restaurant. Franchisees should carefully review these insurance requirements and factor the costs of meeting these requirements into their overall business plan.