Who is financially responsible for the professional liability insurance required for Dermani Medspa?
Dermani_Medspa Franchise · 2025 FDDAnswer from 2025 FDD Document
insurance with minimum employers' liability limits of One Million Dollars ($1,000,000) each accident, as well as such other disability benefits type insurance as may be required by statute or rule of the state in which the Medspa is located;
- (e) umbrella liability insurance with minimum limits of Two Million Dollars ($2,000,000) per occurrence and annual aggregate;
- (f) medical professional liability insurance with minimum limits of One Million Dollars ($1,000,000) per occurrence and Three Million Dollars ($3,000,000) annual aggregate;
- (g) property insurance providing coverage for direct physical loss or damage to real and personal property for all risk perils, including the perils of flood and earthquake, with minimum limits of Two Hundred Thousand Dollars ($200,000); and
- (h) any insurance required by the terms of your lease or that we may require in the future.
- 8.6.3. In addition, you must arrange for the PC to obtain and maintain professional liability coverage with limits of at least One Million Dollars ($1,000,000) for each incident and Three Million Dollars ($3,000,000) annually for itself and naming you and us as an additional insured. You may also carry this insurance for your PC if the insurance provides the protections required by us, under this Agreement and in the Manuals.
- 8.6.4.
Source: Item 23 — RECEIPTS (FDD pages 66–311)
What This Means (2025 FDD)
According to Dermani Medspa's 2025 Franchise Disclosure Document, the franchisee is responsible for securing and maintaining professional liability insurance. Specifically, the franchisee must ensure that their professional corporation (PC) obtains and maintains professional liability coverage. This coverage must have limits of at least $1,000,000 for each incident and $3,000,000 annually.
The franchisee is also required to name both themselves and Dermani Medspa as additional insured parties under this professional liability policy. This requirement ensures that both the franchisee and the franchisor are protected in the event of a claim. The franchisee has the option to carry this insurance directly for their PC, provided that the insurance meets the protections required by Dermani Medspa, as outlined in the franchise agreement and the manuals.
Dermani Medspa retains the right to increase the required coverage amounts or to require different or additional insurance coverage at any time. This may be due to factors such as inflation, the identification of new risks, changes in laws or liability standards, or higher damage awards. If a franchisee fails to obtain and maintain the specified insurance, Dermani Medspa has the right to obtain comparable insurance on behalf of the franchisee. In such cases, the franchisee is responsible for reimbursing Dermani Medspa for all premiums, costs, and expenses incurred, plus a 10% administrative fee.