Who is responsible for the cost of insurance policies for a Crave franchise?
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.
12.2 Such policy or policies shall be written by a responsible, duly licensed carrier or carriers reasonably acceptable to us and shall include, at a minimum (except as additional coverages and higher policy limits may reasonably be specified by us from time to time), in accordance with standards and specifications set forth in writing, any insurance that you must have according to the terms of the lease for the Accepted Location and as required by applicable law. All insurance must be on an "occurrence" basis. Currently you must maintain the following insurance:
12.2.1 Coverage which includes CRAVE Franchising, LLC as additional insureds on a primary non-contributory basis to the general liability policy and the auto liability policy. The additional insureds should be listed on the certificate as follows: CRAVE Franchising, LLC and its member, officers, directors, partners, shareholders, regional directors, subsidiaries and affiliates, agents and employees; and it must be provided on an Additional Insured Grantor of Franchise Endorsement form CG2029 (or an endorsement form with comparable wording acceptable to us).
12.2.2 Insurance must be underwritten by insurers licensed and permitted to write coverage in the state in which the Franchised Business is located.
12.2.3 You and your insurers shall agree to waive rights of subrogation against CRAVE Franchising, LLC.
At least ten (10) days before construction and/or improvement of your Franchised Business begins, and thereafter no fewer than thirty (30) days prior to the expiration of any such policy, you shall deliver to us Certificates of Insurance evidencing the existence and continuation of proper coverage with limits not less than those required hereunder, and you must deliver to us evidence of the waiver.
Each year CRAVE Franchising, LLC may unilaterally modify the insurance minimum coverage requirements which may include an increase to the minimum coverage requirements to reflect changes in inflation or as market conditions warrant.
- 12.6 Should you, for any reason, fail to procure or maintain the insurance required by this Agreement, as such requirements may be revised from time to time by us in writing, we shall have the right and authority (without, however, any obligation to do so) immediately to procure such insurance and to charge same to you, which charges shall be payable by you immediately upon notice together with a ten percent (10%) administrative fee. The foregoing remedies shall be in addition to any other remedies we may have at law or in equity.
- 12.8 We reserve the right to modify the types of insurance coverages and amounts of coverage that you are required to maintain for the Franchised Business, and you agree to comply with any such changes, at your expense.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, the franchisee is responsible for securing and maintaining insurance policies at their own expense. Specifically, before beginning construction or improvements on the franchised business premises, the franchisee must obtain and maintain insurance policies throughout the term of the agreement. These policies protect the franchisee, Crave, and their affiliates against claims related to personal injury, death, property damage, loss, liability, or expenses connected to the franchised business.
The insurance policies must be written by a company acceptable to Crave with a rating of "A-" or higher from A.M. Best Company. The policies must be written by a duly licensed carrier and include any insurance required by the lease for the location and by applicable law. All insurance must be on an "occurrence" basis. Crave Franchising, LLC must be included as additional insureds on a primary non-contributory basis to the general liability and auto liability policies. The franchisee's insurers must also agree to waive rights of subrogation against Crave Franchising, LLC.
The franchisee must provide certificates of insurance to Crave at least ten days before construction begins and no fewer than thirty days before the expiration of any policy. Crave may modify the minimum coverage requirements annually, which may include increases to reflect inflation or market conditions. If the franchisee fails to maintain the required insurance, Crave has the right, but not the obligation, to procure the insurance and charge the franchisee, along with a 10% administrative fee. Crave also reserves the right to modify the required insurance coverages and amounts, with the franchisee responsible for complying with these changes at their own expense.