When must a Cinch I.T. franchisee deliver certificates of insurance evidencing compliance?
Cinch_I_T Franchise · 2024 FDDAnswer from 2024 FDD Document
You shall deliver to Us certificates of insurance evidencing Your compliance no less than ten (10) days prior to opening the Franchised Business.
Such proof of insurance shall include a statement by the insurer that the policy or policies will not be cancelled or materially altered without giving at least thirty (30) days prior written notice to Us. You must submit to Us at least annually, and otherwise upon request by Us, a copy of the certificate of renewal or other evidence of the renewal, existence or extension of such insurance policies.
(f) Should You, for any reason, fail to procure or maintain the insurance required by this Agreement, You shall be considered in Material Breach of this Agreement. In such event, We shall then have the right and authority (but not the obligation) to procure such insurance and to charge the cost of such insurance to You, which charges, together with a reasonable fee for Our expenses in taking such action, shall be payable by You immediately upon notice from Us.
Source: Item 23 — RECEIPTS (FDD pages 60–269)
What This Means (2024 FDD)
According to Cinch I.T.'s 2024 Franchise Disclosure Document, a franchisee must provide certificates of insurance to Cinch I.T. no less than ten days before opening their franchised business. These certificates serve as proof that the franchisee has secured the necessary insurance coverage as mandated by the franchise agreement.
Furthermore, the proof of insurance must include a statement from the insurer guaranteeing that the policy will not be canceled or significantly altered without providing Cinch I.T. with at least thirty days' prior written notice. This ensures that Cinch I.T. is informed of any changes to the franchisee's insurance coverage, allowing them to take appropriate action if necessary.
In addition to the initial certificate, the franchisee is obligated to submit a copy of the certificate of renewal or other evidence of the renewal, existence, or extension of the insurance policies to Cinch I.T. at least annually and also upon request. This ongoing requirement ensures that the franchisee maintains continuous insurance coverage throughout the term of the franchise agreement. Failure to maintain the required insurance constitutes a material breach of the agreement, potentially giving Cinch I.T. the right to procure insurance on the franchisee's behalf and charge the costs to the franchisee, along with a reasonable fee for expenses.