Does the Craters & Freighters franchise agreement require franchisees to pay for insurance?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
WHEREAS, Franchisor was organized September 23, 1991, for the purpose of developing a national network that provides quality crating, packaging, shipping, receiving and delivery, storage, transportation, logistics services, and freight forwarding services products and services for companies and individuals in specific market areas.
WHEREAS, Franchisor has developed a multitude of programs specific to the operation of a Craters & Freighters® franchised business ("Franchised Business") including but not limited to specialized crating and packaging techniques, shipping and logistics solutions, a national accounts program, national cargo insurance plan, proprietary software, advertising programs, brand identity system, and a comprehensive website.
Franchisee must comply with both the Lease and any additional leasehold covenants and regulations of the building in which the Premises is located.
Source: Item 22 — CONTRACTS (FDD pages 49–50)
What This Means (2025 FDD)
Based on the 2025 Craters & Freighters Franchise Disclosure Document, Craters & Freighters has developed a national cargo insurance plan. However, the excerpts provided do not explicitly state whether franchisees are required to participate in this plan or obtain their own insurance coverage. The FDD excerpts do mention that franchisees must comply with lease requirements, which may include insurance obligations if mandated by the lease agreement for the premises.
While the FDD excerpts do not provide a definitive answer regarding mandatory insurance, they do highlight the availability of a national cargo insurance plan developed by Craters & Freighters. This suggests that Craters & Freighters recognizes the importance of insurance in the crating, packaging, and shipping business and has taken steps to provide a potential solution for its franchisees.
A prospective Craters & Freighters franchisee should clarify with the franchisor whether participation in the national cargo insurance plan is mandatory or if franchisees have the option to obtain insurance from other providers. Additionally, they should inquire about the specific types and amounts of insurance coverage required to operate a Craters & Freighters franchise, including any requirements related to cargo, liability, and property insurance. Understanding these insurance requirements is crucial for assessing the overall cost and risk associated with the franchise.