If the comprehensive general liability insurance policy for a Deer Solution franchise is written on a claims-made form, how much tail coverage is required?

According to Deer Solution's 2025 Franchise Disclosure Document, if the comprehensive general liability insurance policy is written on a claims-made form, the franchisee must have at least one year of tail coverage. Additionally, the comprehensive general liability insurance must be written on an occurrence basis, extended to include contractual liability, product liability, products and completed operations, and personal and advertising injury, with a combined bodily injury and property damage limit of at least $1,000,000 per occurrence and $2,000,000 in aggregate with a pesticide exposure coverage rider of at least $1,000,000, and a per location aggregate endorsement.

Tail coverage, also known as extended reporting period coverage, is crucial for claims-made policies because it covers claims that are reported after the policy expires but arise from incidents that occurred while the policy was active. This is particularly important in the context of general liability, where claims may surface long after the actual incident. The one-year tail coverage requirement ensures that Deer Solution franchisees are protected against potential future claims, providing a financial safety net.

The insurance requirements also extend to other types of coverage, such as commercial umbrella liability insurance with a total liability limit of at least $1,000,000, network security and privacy liability insurance in the amount of at least $50,000, and employment practices liability insurance with a limit of at least $250,000. These requirements ensure that franchisees have a comprehensive insurance portfolio to protect against various risks associated with operating a Deer Solution franchise.

It is important for prospective Deer Solution franchisees to consult with their insurance carrier representative to determine the level of coverage necessary for their franchised business, as higher exposures may require higher limits. Franchisees must also furnish a certificate of insurance to Deer Solution at the earlier of 90 days after the Effective Date of the Franchise Agreement or prior to the commencement of the initial training program.