What is the minimum A.M. Best Company rating acceptable for insurance companies providing coverage to Crave franchisees?
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 must secure insurance policies from companies with a rating of "A-" or higher from A.M. Best Company. This requirement ensures that the insurance provider has a strong financial standing and the ability to cover potential claims.
This stipulation is in place to protect both the franchisee and Crave Franchising, LLC from financial losses due to unforeseen events such as property damage, personal injury, or other liabilities. By mandating a minimum rating, Crave aims to mitigate the risk of dealing with an insurer that may be unable to fulfill its obligations.
Prospective franchisees should verify that their chosen insurance carriers meet this rating criterion to comply with the franchise agreement. Failure to maintain adequate insurance coverage with a qualified insurer could result in the franchisor procuring insurance on the franchisee's behalf, along with a 10% administrative fee, as detailed in Article 12.6 of the franchise agreement.