Who is responsible for loss or damage arising from the operation of a Chicken Guy Franchised Restaurant?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
A. Procurement of Insurance by Franchisee. Franchisee shall be responsible for all loss or damage arising from or related to Franchisee's development and operation of the Franchised Restaurant, and for all demands or claims with respect to any loss, liability, personal injury, death, property damage, or expense whatsoever occurring upon the premises of, or in connection with the development or operation of, the Franchised Restaurant. Franchisee shall maintain in full force and effect throughout the term of this Agreement that insurance which Franchisee determines is necessary or appropriate for liabilities caused by or occurring in connection with the development or operation of the Franchised Restaurant which shall include, at a minimum, insurance policies of the kinds, and in the amounts, required by Section 16.B. Chicken Guy, and any entity with an insurable interest designated by Chicken Guy, shall be an additional insured in all liability policies (except workers compensation) to the extent each has an insurable interest.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, the franchisee is responsible for all loss or damage arising from the development and operation of the franchised restaurant. This includes any demands or claims related to loss, liability, personal injury, death, property damage, or expenses occurring on the premises or in connection with the restaurant's development or operation.
This means that as a Chicken Guy franchisee, you are expected to cover any costs associated with incidents that occur at your restaurant. This could range from a customer slipping and falling to damage to the property caused by a fire or natural disaster. It is crucial to understand that this responsibility extends throughout the entire term of the franchise agreement.
To mitigate these risks, Chicken Guy requires franchisees to maintain insurance policies that they deem necessary or appropriate. These policies must cover liabilities caused by or occurring in connection with the development or operation of the franchised restaurant. Chicken Guy, and any entity they designate with an insurable interest, must be included as an additional insured in all liability policies, except for workers' compensation. This ensures that both the franchisee and Chicken Guy are protected in the event of a claim. Franchisees should carefully consider the types and amounts of insurance needed to adequately protect their investment and business operations.