What is the minimum amount of employment practices liability insurance coverage required per occurrence and aggregate limit for a Checkers franchise?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
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Insurance
During the term of the Franchise Agreement, you must maintain the following categories of insurance coverage in force at your sole expense, all containing at least the following minimum amounts of liability coverage: (a) general liability ($1,000,000 per occurrence and $2,000,000 aggregate); (b) automobile ($1,000,000 combined single limit) for owned and hired, non-owned liability; (c) umbrella liability ($5,000,000 per occurrence and aggregate) with employer's liability, general liability, and automobile liability scheduled as underlying policies; (d) property covering the Franchised Restaurant and personal property in an amount 100% of the full replacement cost of the Franchised Restaurant and personal property, and business income coverage covering 12 months of actual loss sustained; (e) workers' compensation (as required by statute); (f) employer's liability ($1,000,000/$1,000,000/$1,000,000); (g) employment practices liability ($1,000,000 per occurrence and aggregate limit); (h) cyber insurance ($1,000,000 per occurrence and agg
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 must maintain employment practices liability insurance with a minimum coverage of $1,000,000 per occurrence and an aggregate limit of $1,000,000. This insurance is intended to protect both the franchisee and Checkers from potential liabilities arising from employment-related claims.
The requirement to maintain this level of insurance coverage ensures that Checkers franchisees are prepared to handle potential legal and financial risks associated with employment practices. This coverage can help cover legal costs, settlements, and other expenses related to claims of discrimination, wrongful termination, harassment, or other employment-related issues. By setting a minimum coverage amount, Checkers aims to standardize risk management across all franchise locations.
It is important to note that Checkers retains the right to increase the required coverage amounts or mandate additional insurance policies to reflect changes in the legal landscape, increased risks, or other relevant factors. Franchisees should factor in the cost of this insurance, along with other insurance requirements, when assessing the overall financial investment required to operate a Checkers franchise. Prospective franchisees should also confirm with the franchisor which insurance carriers are approved and what specific policy terms are acceptable to Checkers.