What is the minimum combined single limit for automobile insurance coverage required 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's 2025 Franchise Disclosure Document, franchisees must maintain automobile insurance with a minimum combined single limit of $1,000,000 for owned, hired, and non-owned liability. This requirement is part of a broader set of insurance obligations that Checkers imposes to protect its brand and manage risk across the franchise system.
In addition to the automobile insurance, Checkers franchisees are required to maintain other types of coverage, including general liability ($1,000,000 per occurrence and $2,000,000 aggregate), umbrella liability ($5,000,000 per occurrence and aggregate), property insurance, workers' compensation, employer's liability ($1,000,000/$1,000,000/$1,000,000), employment practices liability ($1,000,000 per occurrence and aggregate limit), and cyber insurance ($1,000,000 per occurrence and aggregate limit). These insurance policies must be issued by carriers approved by Checkers with an A.M. Best Rating of not less than A VII.
Checkers also stipulates that all insurance policies must name Checkers and its affiliates as additional insured, provide for 30 days' prior written notice of any material modification, cancellation, or expiration, and include a waiver of subrogation in favor of Checkers and its affiliates. The franchisor retains the right to periodically increase the required coverage amounts or require different or additional insurance coverage to reflect changes in circumstances such as inflation or new risks. Franchisees should factor these insurance costs into their overall financial planning, as they can be a significant ongoing expense.