What are the insurance requirements for worker's compensation and employer's liability insurance for Degree Wellness franchisees?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
which we or our affiliates are approved suppliers (see below).
You must obtain and maintain, at your own expense, the insurance coverage that we periodically require and satisfy other insurance-related obligations. You must purchase (1) comprehensive commercial general liability and motor vehicle liability insurance containing minimum liability coverage of not less than $1,000,000 per occurrence and $3,000,000 in the aggregate, (2) worker's compensation and employer's liability insurance as required by law, with limits equal to or in excess of those required by law, (3) professional liability (malpractice) insurance, for each doctor practicing in your Franchise business, having limits of not less than
$1,000,000 per occurrence and $3,000,000 in the aggregate and (4) any other insurance required by applicable law, rule, regulation, ordinance or licensing requirements. Deductibles must be in reasonable amounts and are subject to review and written approval by us. Your commercial general liability insurance policy must be an "occurrence" policy. If any policy is written on a "Claims Made" basis, you must purchase and maintain unlimited tail coverage that shall remain in effect following the termination or expiration of the Franchise Agreement and/or such policy. All commercial general liability insurance and professional liability (malpractice) insurance policies you purchase must name us (and, if we so request, our members, directors, employees, agents, and affiliates) as additional insureds. If you fail to obtain or maintain the insurance we specify, we may (but need not) obtain the insurance for you and the Studio on your behalf (see Item 6). You should consult with your own insurance agents, brokers, and attorneys to determine what types of coverages and what level of insurance protection you may need or desire, in addition to the coverages and minimum limits specified by us. The cost of your premiums will depend on the insurance carrier's char
Source: Item 8 — Restrictions on Sources of Products and Services (FDD pages 26–29)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, franchisees are required to obtain and maintain worker's compensation and employer's liability insurance as mandated by law. The insurance limits must be equal to or exceed those required by law. This requirement ensures that Degree Wellness franchisees comply with all applicable legal standards regarding employee protection.
In addition to worker's compensation and employer's liability insurance, Degree Wellness requires franchisees to secure other types of insurance, including comprehensive commercial general liability and motor vehicle liability insurance with minimum coverage of $1,000,000 per occurrence and $3,000,000 in the aggregate. Franchisees must also obtain professional liability (malpractice) insurance for each doctor practicing in their franchise business, with limits of not less than $1,000,000 per occurrence and $3,000,000 in the aggregate. Furthermore, franchisees must carry any other insurance required by applicable law, rule, regulation, ordinance, or licensing requirements.
The FDD specifies that deductibles must be in reasonable amounts and are subject to Degree Wellness's review and written approval. The commercial general liability insurance policy must be an "occurrence" policy. If any policy is written on a "Claims Made" basis, the franchisee must purchase and maintain unlimited tail coverage that remains effective following the termination or expiration of the Franchise Agreement and/or such policy. Degree Wellness also mandates that all commercial general liability insurance and professional liability (malpractice) insurance policies name Degree Wellness (and, if requested, its members, directors, employees, agents, and affiliates) as additional insureds.
If a franchisee fails to obtain or maintain the specified insurance, Degree Wellness has the option, but not the obligation, to obtain the insurance for the franchisee and the Studio on the franchisee's behalf. The cost of premiums will vary based on the insurance carrier's charges, terms of payment, and the franchisee's insurance and payment histories. Degree Wellness advises franchisees to consult with their own insurance agents, brokers, and attorneys to determine the types and levels of insurance protection needed beyond the minimum requirements specified by Degree Wellness.