What standards must insurance companies meet to be satisfactory to Chicken Guy?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
- **B.
Minimum Insurance Requirements.** All insurance policies shall be written by an insurance company or companies satisfactory to Chicken Guy, in compliance with the standards, specifications, coverages and limits set forth in the Manual or otherwise provided to Franchisee in writing.
Chicken Guy may reasonably increase the minimum required coverage and require different or additional kinds of insurance to reflect inflation, changes in standards of liability, higher damage awards or other relevant changes in circumstances.
Franchisee shall receive written notice of such modifications and shall take prompt action to secure the additional coverage or higher policy limits.
- (2) No insurance policy shall contain a provision that in any way limits or reduces coverage for Franchisee in the event of a claim by Chicken Guy or its affiliates.
- (3) Each insurance policy shall extend to, and provide indemnity for, all obligations and liabilities of Franchisee to third parties and all other items for which Franchisee is required to indemnify Chicken Guy under this Agreement.
- (4) Each insurance policy shall be written by an insurance company that has received and maintains an "A+" or better rating by the latest edition of Best's Insurance Rating Service.
- (5) No insurance policy shall provide for a deductible amount that exceeds $5,000, unless otherwise approved in writing by Chicken Guy, and Franchisee's co-insurance under any insurance policy shall be 80% or greater.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, all insurance policies must be written by an insurance company that Chicken Guy finds satisfactory. These companies must comply with the standards, specifications, coverages, and limits detailed in the manual or provided to the franchisee in writing. Chicken Guy can increase the minimum required coverage and require different or additional kinds of insurance to reflect inflation, changes in standards of liability, higher damage awards, or other relevant changes in circumstances. Franchisees will receive written notice of such modifications and must promptly secure the additional coverage or higher policy limits.
In addition to meeting Chicken Guy's general approval, the insurance company must also meet specific requirements. The insurance policy must not limit or reduce coverage for the franchisee in the event of a claim by Chicken Guy or its affiliates. Each policy must extend to and provide indemnity for all obligations and liabilities of the franchisee to third parties and all other items for which the franchisee is required to indemnify Chicken Guy under the Franchise Agreement.
Furthermore, the insurance company must have received and maintain an "A+" or better rating by the latest edition of Best's Insurance Rating Service. The insurance policy should not provide for a deductible amount that exceeds $5,000, unless Chicken Guy approves otherwise in writing. The franchisee's co-insurance under any insurance policy must be 80% or greater. These requirements ensure that the franchisee has adequate insurance coverage from a reputable company, protecting both the franchisee and Chicken Guy from potential liabilities and losses.