What is the minimum aggregate liability limit required for professional liability (malpractice) insurance for each doctor practicing in a Degree Wellness franchise?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
may have, you agree to pay the employee's current or former employer twice the employee's annual salary, plus all costs and attorneys' fees incurred as a result of the violation. This amount is set at twice the employee's annual salary because it is a reasonable estimation of the damages that would occur from such a breach, and it will almost certainly be impossible to calculate precisely the actual damages from such a breach.)
10.8 Insurance
a. Before you open the Franchise and during any Term of this Agreement, you must maintain in force, under policies of insurance issued by carriers in good standing in the state where your Studio is located: (1) comprehensive commercial general liability and motor vehicle liability insurance against claims for bodily and personal injury, death and property damage caused by or occurring in conjunction with the operation of the Franchise or otherwise in conjunction with your conduct of the Franchise business pursuant to this Agreement, under one or more policies of 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
statute; (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. We may periodically increase or decrease the amounts of coverage required under these insurance policies, and/or require different or additional kinds of insurance, including excess liability insurance, to reflect inflation, identification of new risks, changes in law or standards of liability, higher damage awa
Source: Item 23 — Receipts (FDD pages 66–257)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, franchisees are required to maintain professional liability (malpractice) insurance for each doctor practicing in their franchise business. The minimum liability coverage must be at least $1,000,000 per occurrence and $3,000,000 in the aggregate.
Degree Wellness also retains the right to modify these insurance coverage amounts periodically. This flexibility allows them to adjust the requirements due to factors like inflation, the emergence of new risks, changes in legal standards, or increased damage awards. Franchisees must stay informed of any changes to the required insurance coverage to ensure they remain compliant with the franchise agreement.
In addition to the specifically required insurance policies, Degree Wellness highly recommends that franchisees obtain additional coverage, including property damage, business interruption, employment practices, cyber liability, and electronic data loss insurance. While not mandatory, these additional coverages can provide a more comprehensive risk management strategy for the franchisee's business.