Are there any deductible limits specified for the property insurance required by Chocolate Bash?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
- B. Insurance. You must obtain insurance as described in the Franchise Agreement and in our Manual, which includes (i) "Special" causes of loss coverage forms, including fire and extended coverage, crime, vandalism, and malicious mischief, on all property of the Business, for full repair and replacement value (subject to a reasonable deductible); (ii) Business interruption insurance covering at least 12 months of income; (iii) Commercial General Liability insurance, including products liability coverage, and broad form commercial liability coverage, written on an "occurrence" policy form in an amount of not less than $1,000,000 single limit per occurrence and $2,000,000 aggregate limit, (iv) Workers Compensation coverage as required by state law. Your policies (other than Workers Compensation) must list us and our affiliates as an additional insured, must include a waiver of subrogation in favor of us and our affiliates, must be primary and noncontributing with any insurance carried by us or our affiliates, and must stipulate that we receive 30 days' prior written notice
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 15–17)
What This Means (2024 FDD)
According to Chocolate Bash's 2024 Franchise Disclosure Document, franchisees are required to obtain specific insurance coverages. The document states that franchisees must acquire "Special" causes of loss coverage, including fire and extended coverage, crime, vandalism, and malicious mischief, on all business property for its full repair and replacement value. This coverage is "subject to a reasonable deductible."
In addition to property insurance, Chocolate Bash franchisees must also maintain business interruption insurance covering at least 12 months of income. They are also required to have Commercial General Liability insurance, including products liability coverage, with a minimum of $1,000,000 single limit per occurrence and $2,000,000 aggregate limit. Furthermore, franchisees must secure Workers Compensation coverage as mandated by state law.
The insurance policies, excluding Workers Compensation, must list Chocolate Bash and its affiliates as additional insured parties and include a waiver of subrogation in their favor. These policies must also be primary and noncontributing with any insurance held by Chocolate Bash or its affiliates. Finally, the insurance provider must give Chocolate Bash 30 days' prior written notice of any policy cancellation.
While Chocolate Bash specifies the types and amounts of insurance coverage needed, it only mentions that the property insurance is subject to a "reasonable deductible" without defining a specific limit. Prospective franchisees should discuss what Chocolate Bash considers a 'reasonable' deductible with the franchisor to understand the potential out-of-pocket expenses in case of property damage or loss.