Does Degree Wellness require franchisees to obtain and maintain insurance coverage?
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 specific insurance coverage at their own expense. This includes comprehensive commercial general liability and motor vehicle liability insurance with a minimum coverage of $1,000,000 per occurrence and $3,000,000 in the aggregate. Additionally, franchisees must secure worker's compensation and employer's liability insurance as mandated by law, with limits meeting or exceeding legal requirements. Furthermore, professional liability (malpractice) insurance is necessary for each doctor practicing within the Degree Wellness franchise, with specified limits.
The commercial general liability insurance policy must be an "occurrence" policy. If the policy is written on a "Claims Made" basis, the franchisee must maintain unlimited tail coverage that remains effective after the Franchise Agreement terminates or expires. Degree Wellness also requires that it (and its members, directors, employees, agents, and affiliates, if requested) be named as additional insureds on all commercial general liability and professional liability (malpractice) insurance policies.
If a franchisee fails to obtain or maintain the required insurance, Degree Wellness has the option, but not the obligation, to obtain the insurance on behalf of the franchisee and the studio. The FDD advises prospective franchisees to consult with their own insurance agents, brokers, and attorneys to determine the types and levels of insurance protection needed beyond the minimums specified by Degree Wellness. The cost of premiums will vary based on the insurance carrier's charges, payment terms, and the franchisee's insurance and payment histories. This is a fairly standard requirement in franchising, as it protects both the franchisee and franchisor from potential liabilities.