Does Crab N Spice require 'Special' causes of loss coverage forms?
Crab_N_Spice Franchise · 2024 FDDAnswer from 2024 FDD Document
ure document as Exhibit D).
- 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) Business Automobile Liability insurance including owned, leased, non-owned and hired automobiles coverage in an amount of not less than $1,000,000, and (v) 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 non-contributing with any insurance carried by us or our affiliates, and must stipulate that we receive 30 days' prior wri
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 17–19)
What This Means (2024 FDD)
According to Crab N Spice's 2024 Franchise Disclosure Document, franchisees are required to obtain specific insurance coverages. Among these requirements, Crab N Spice mandates that franchisees secure "Special" causes of loss coverage forms. This coverage must include protection against fire and extended coverage, crime, vandalism, and malicious mischief, ensuring that all business property is covered for its full repair and replacement value, subject to a reasonable deductible.
In addition to the "Special" causes of loss coverage, Crab N Spice franchisees must also maintain business interruption insurance covering at least 12 months of income, commercial general liability insurance with a minimum of $1,000,000 single limit per occurrence and $2,000,000 aggregate limit, and business automobile liability insurance of not less than $1,000,000. Furthermore, franchisees are obligated to carry Workers Compensation coverage as mandated by state law.
The insurance policies, excluding Workers Compensation, must list Crab N Spice and its affiliates as additional insured parties. These policies must also include a waiver of subrogation in favor of Crab N Spice and its affiliates, be primary and non-contributing with any insurance carried by Crab N Spice or its affiliates, and stipulate that Crab N Spice receives 30 days' prior written notice of cancellation. This ensures that Crab N Spice is protected and informed of any changes to the franchisee's insurance coverage.