Must Crave franchisees maintain insurance coverage for events occurring during the term of the Franchise Agreement, even after the agreement ends?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
12.1 You shall procure, before you begin construction and/or improvement of the Franchised Business premises, and shall maintain in full force and effect at all times during the term of this Agreement (and for such period thereafter as is necessary to provide the coverages required hereunder for events having occurred during the term of this Agreement) at your expense, an insurance policy or policies protecting you and us, our successors and assigns, our affiliates, and our respective officers, directors, shareholders, partners, agents, representatives, independent contractors and employees of each of them against any demand or claim with respect to personal injury, death or property damage, or any loss, liability or expense whatsoever arising or occurring upon or in connection with the Franchised Business. Such insurance policies must be written by an insurance company acceptable to us and which has a rating of "A-" or higher with A.M. Best Company.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, franchisees are required to maintain insurance coverage not only during the term of the Franchise Agreement but also for a period after the agreement ends. This extended coverage is necessary to cover any claims or demands related to events that occurred during the original term of the agreement.
This requirement ensures that both the franchisee and Crave Franchising, LLC are protected against potential liabilities arising from incidents that took place while the franchise was in operation. The insurance policies must be written by a company acceptable to Crave, with a rating of "A-" or higher from A.M. Best Company, indicating a financially stable insurer.
Crave franchisees must ensure their insurance policies remain active for the specified period after the agreement's termination to address any latent claims. Failing to maintain this coverage could expose the franchisee to significant financial risk and potential legal liabilities for incidents occurring during the franchise term.