What are the minimum liability coverage limits per occurrence and in the aggregate for the professional liability (malpractice) insurance that each doctor providing Licensed Provider Services for Degree Wellness must have?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
MENT SHALL BE INTERPRETED AS DIRECTING OR INFLUENCING SUCH REFERRALS. NONE OF MANAGEMENT COMPANY'S SERVICES HEREUNDER SHALL CONSTITUTE OBLIGATIONS OF MANAGEMENT COMPANY TO GENERATE PATIENTS TO LICENSED PROVIDER.
8. Insurance.
- 8.1 During the Agreement Term, Licensed Provider must maintain in force, under policies of insurance issued by carriers in good standing in the state where the Premises 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 Studio or otherwise in conjunction with the performance of the Licensed Provider Services 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 providing the Licensed Provider Services, 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. Management Company 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 awards, or other relevant changes in circumstances. Licensed Provider agrees that compliance with any state minimum insurance requirements does not relieve Licensed Provider from the obligation to comply with the contractual insurance requirements in this Agreement.
- 8.2 Licensed Provider must provide Management Co
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 63–66)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, each doctor providing Licensed Provider Services must maintain professional liability (malpractice) insurance with minimum coverage limits of $1,000,000 per occurrence and $3,000,000 in the aggregate. This requirement ensures that doctors have sufficient coverage to protect against potential malpractice claims arising from their services.
The document also states that Management Company may periodically adjust the required coverage amounts, potentially increasing or decreasing them to reflect factors such as inflation, new risks, changes in laws, or higher damage awards. It is important to note that compliance with state minimum insurance requirements does not relieve the Licensed Provider from meeting the contractual insurance obligations outlined in the agreement with Degree Wellness.
Licensed Providers are required to provide Management Company with 30 days' advance written notice of any material modification, cancellation, or expiration of any insurance policy. Additionally, deductibles for these policies must be in reasonable amounts and are subject to review and written approval by Management Company.
It is advisable for Licensed Providers to consult with their own insurance agents, brokers, and attorneys to determine the types and levels of insurance protection they may need or desire, in addition to the minimum requirements specified by Management Company. This ensures comprehensive coverage tailored to their specific circumstances and risk profile.