What minimum insurance coverages are required for each Churchs Chicken Franchised Restaurant?
Churchs_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchised Restaurant is located.
- D. Certified Training Restaurants. Within 90 days after Developer opens its first Franchised Restaurant and before Developer may begin construction on its second Franchised Restaurant as provided in Section 6.B., Developer, at its own expense, must establish its first Franchised Restaurant as a Certified Training Restaurant ("CTR") at which a designated training manager can conduct the MIT Program and other training programs for those designated employees of Franchisee and other Cajun franchisees whose franchised Church's Restaurants are located in the same DMA as the CTR.
8. INSURANCE
- A. Insurance Program. Developer, and not Cajun, shall be responsible for all loss or damage arising from or related to Developer's development and operation of each 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, each Franchised Restaurant. Developer shall maintain in full force and effect throughout the Development Term that insurance which Developer determines is necessary or appropriate for liabilities caused by or occurring in connection with the development or operation of each Franchised Restaurant which shall include, at a minimum, insurance policies of the kinds, and in the amounts, required by Section 8.B. Developer shall cause Cajun and any entity with an insurable interest designated by Cajun be named as an additional insured for General Liability and loss payee for property policy to the extent each has an insurable interest.
- B. Minimum Insurance Requirements. Developer shall obtain all insurance policies from an insurance company or companies satisfactory to Cajun, in compliance with the standards, specifications, coverages and limits set forth in the Manual or otherwise provided to Developer in writing. Cajun may reasonably increase the minimum coverage required 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. Developer shall receive written notice of such modifications and shall take prompt action to secure the additional coverage or higher policy limits. These policies shall include, at a minimum, the following for each Franchised Restaurant:
- (1) Comprehensive or Commercial General Liability Insurance, including coverage for bodily injury, personal injury, death and property damage, including Premises and Operations, independent contractors, blanket contractual liability, broad form property damage, products and completed operations and property damage on an occurrence basis with policy limits of not less than $1,000,000 per occurrence and $2,000,000 in the aggregate or split liability limits of $1,000,000 for bodily injury per person; $1,000,000 for bodily injury per occurrence; and $500,000 for property damage.
- (2) Comprehensive Automobile Liability Insurance, if applicable, covering owned, non-owned and hired vehicles with limits as follows: combined single limit of $500,000 for bodily injury, death and property damage per occurrence; or split liability limits of $500,000 for bodily injury per person; $500,000 for bodily injury per occurrence; and $250,000 for property damage.
- (3) All Risk Property Insurance, written on an "All Risks" policy for fire and related peril (including floods and earthquakes where applicable) with limits of insurance of not less than the full replacement value of each Franchised Restaurant, and its furniture, fixtures, equipment, inventory and other tangible property on Special Form. If the Franchised Location is in an area prone to geological phenomena, including, but not limited to, wind, sinkholes, mine subsidence, earthquakes, hurricanes, tornadoes, or floods, the all-risk property insurance shall cover such risks.
- (4) Employer's Liability Insurance for employee bodily injury and deaths, with a limit of $500,000 per incident.
- (5) Workers' Compensation and such other insurance as may be required by statute or rule of the state or locality in which each Franchised Restaurant will be located. This coverage shall also be in effect for all of Developer's employees who participate in any of Cajun's training programs.
- (6) Builders All Risk Insurance in connection with any construction, renovation, refurbishment or remodeling of a Franchised Restaurant and in connection with new construction or substantial renovation, refurbishment or remodeling of a Franchised Restaurant, Developer shall maintain performance and completion bonds in forms and amounts, and written by carrier(s), reasonably satisfactory to Cajun.
- (7) Employment Practice Liability Insurance containing third party endorsement is highly recommended.
- C. General Insurance Requirements. The following general requirements shall apply to each insurance policy that Developer is required to maintain under this Agreement:
- (1) Each insurance policy shall be specifically endorsed to provide that the coverages shall be primary and that any insurance carried by any additional insured shall be excess and noncontributory.
Source: Item 23 — RECEIPT (FDD pages 68–406)
What This Means (2025 FDD)
According to Churchs Chicken's 2025 Franchise Disclosure Document, franchisees are required to maintain specific insurance policies throughout the duration of their franchise agreement. The franchisee is responsible for any losses or damages related to the development and operation of the franchised restaurant. These policies must be obtained from an insurance company that is satisfactory to Churchs Chicken. Churchs Chicken may increase the minimum coverage required or mandate different or additional kinds of insurance to reflect changes in liability standards, inflation, or other relevant circumstances.
The minimum insurance requirements for each Churchs Chicken franchised restaurant include Comprehensive or Commercial General Liability Insurance with coverage for bodily injury, death, and property damage with policy limits of not less than $1,000,000 per occurrence and $2,000,000 in the aggregate, or split liability limits of $1,000,000 for bodily injury per person, $1,000,000 for bodily injury per occurrence, and $500,000 for property damage. If applicable, franchisees must also maintain Comprehensive Automobile Liability Insurance covering owned, non-owned, and hired vehicles with a combined single limit of $500,000 for bodily injury, death, and property damage per occurrence, or split liability limits of $500,000 for bodily injury per person, $500,000 for bodily injury per occurrence, and $250,000 for property damage.
Additional required insurance includes All Risk Property Insurance, written on an "All Risks" policy for fire and related perils, with limits not less than the full replacement value of the restaurant and its contents. Employer's Liability Insurance is required for employee bodily injury and deaths, with a limit of $500,000 per incident. Franchisees must also carry Workers' Compensation and any other insurance required by state or local statute. Business Interruption Insurance of not less than $25,000 per month is required, covering obligations related to leases, royalties, and other fixed costs, with a limit of not less than six months of business interruption loss. Furthermore, Employment Practice Liability Insurance containing a third-party endorsement of not less than $1,000,000 per occurrence and aggregate, and Cyber Liability Insurance with an insuring agreement for multimedia liability coverage of not less than $1,000,000 per occurrence and aggregate are also required.
Churchs Chicken franchisees must ensure that each insurance policy is written by a company with an "A" or better rating from Best's Insurance Rating Service. Unless otherwise approved by Churchs Chicken in writing, no policy can have a deductible exceeding $5,000, and the franchisee's co-insurance must be 80% or greater. All liability insurance policies must be written on an "occurrence" policy form. Franchisees are responsible for paying all deductibles from insured claims. Franchisees must provide evidence of insurance to Churchs Chicken 15 days before construction begins and before opening for business. They must also submit evidence of satisfactory insurance and proof of payment to Churchs Chicken upon obtaining insurance and on each policy renewal date thereafter.