What is the minimum amount of Business Automobile Liability insurance coverage required by Desi District?
Desi_District Franchise · 2024 FDDAnswer from 2024 FDD Document
re document as Exhibit D).
- B. Insurance. You must obtain insurance as described in the Franchise Agreement and in our Brand Standards Manual, which includes (i) "Special" causes of loss coverage forms, including fire and extended coverage, crime, vandalism, and malicious mischief, on all property of the Business, for full repair and replacement value (subject to a reasonable deductible); (ii) Business interruption insurance covering at least 12 months of income; (iii) Commercial General Liability insurance, including products liability coverage, and broad form commercial liability coverage, written on an "occurrence" policy form in an amount of not less than $1,000,000 single limit per occurrence and $2,000,000 aggregate limit, (iv) Business Automobile Liability insurance including owned, leased, non-owned and hired automobiles coverage in an amount of not less than
$1,000,000, and (v) Workers Compensation coverage as required by state law. Your policies (other than Workers Compensation) must list us and our affiliates as an additional insured, must include a waiver of subrogation in favor of us and our affiliates, must be primary and non-contributing with any insurance carried by us or our affiliates, and must stipulate that we receive 30 days' prior writ
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 26–29)
What This Means (2024 FDD)
According to Desi District's 2024 Franchise Disclosure Document, franchisees are required to maintain Business Automobile Liability insurance with a minimum coverage of $1,000,000. This insurance must cover owned, leased, non-owned, and hired automobiles.
This requirement ensures that Desi District franchisees have adequate financial protection in the event of an automobile accident involving their business. The $1,000,000 minimum coverage is a standard amount for business automobile liability insurance, reflecting the potential for significant financial losses from accidents involving bodily injury or property damage. Franchisees need to factor in the cost of this insurance when assessing the overall financial investment required to start and operate a Desi District franchise.
In addition to the minimum coverage amount, Desi District requires that the insurance policy list the franchisor and its affiliates as additional insured parties. The policy must also include a waiver of subrogation in favor of Desi District and its affiliates, be primary and non-contributing with any insurance carried by the franchisor, and stipulate that Desi District receive 30 days' prior written notice of cancellation. These stipulations protect Desi District from potential liabilities arising from the franchisee's business operations and ensure they are informed of any changes to the franchisee's insurance coverage.