What advance written notice must the insurer provide to Chicken Guy before canceling or materially altering a Chicken Guy franchisee's insurance policy?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
- D. Proof of Insurance. No later than 30 days after this Agreement is executed by Chicken Guy, and on each policy renewal date thereafter, Franchisee shall submit a certificate of insurance, or other evidence of satisfactory insurance as required by this Section 16.D. and proof of payment therefor to Chicken Guy. The evidence of insurance shall include a statement by the insurer that the policy or policies will not be canceled or materially altered without at least 10 days' prior written notice to Chicken Guy. Upon request, Franchisee also shall provide to Chicken Guy copies of all or any policies, and policy amendments and riders.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, the insurer must provide at least 10 days' prior written notice to Chicken Guy before canceling or materially altering a franchisee's insurance policy. This requirement is part of the insurance obligations outlined in the franchise agreement.
This stipulation ensures that Chicken Guy is informed of any changes to the franchisee's insurance coverage, allowing them to take necessary steps to protect their interests and ensure continuous coverage. The franchisee is responsible for submitting a certificate of insurance to Chicken Guy no later than 30 days after the agreement is executed and on each policy renewal date thereafter.
The evidence of insurance must include a statement from the insurer guaranteeing this 10-day notice. This protects Chicken Guy from potential liabilities arising from underinsured or uninsured franchisees. Franchisees must maintain adequate insurance coverage throughout the term of the agreement, and failure to do so could result in a breach of contract.
Prospective franchisees should understand that maintaining the required insurance is a critical aspect of their obligations under the franchise agreement. They should also confirm that their insurance policies meet all the requirements specified by Chicken Guy, including the minimum coverage amounts and the inclusion of Chicken Guy as an additional insured.