Who must the Ella Cafe franchisee's insurance policy protect during construction?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
- (ii) During construction, Franchisee must maintain general liability and property damage insurance of the type and with the limits Franchisor requires, protecting Franchisee and Franchisor and its Affiliates and their respective partners, shareholders, directors, agents, and employees.
Such policy or policies must be written by a responsible insurer or insurers acceptable to Franchisor and must contain a waiver of subrogation in favor of Franchisor and its Affiliates, and their respective partners, shareholders, directors, agents, and employees.
Franchisee must notify Franchisor in writing when construction begins and thereafter must provide progress reports when, and in the form, required by Franchisor.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, during the construction of the coffee house, the franchisee's general liability and property damage insurance must protect the franchisee, Ella Cafe, its affiliates, and their respective partners, shareholders, directors, agents, and employees.
This requirement ensures that multiple parties are shielded from potential financial losses resulting from accidents, injuries, or property damage that may occur during the construction phase. The insurance policy must also include a waiver of subrogation in favor of Ella Cafe and its affiliates, preventing the insurance company from pursuing claims against them to recover any payments made under the policy.
It is the franchisee's responsibility to secure this insurance coverage, and the policy must be written by an insurer acceptable to Ella Cafe. The franchisee must also notify Ella Cafe in writing when construction begins and provide progress reports as required by the franchisor. This ensures that Ella Cafe is kept informed about the construction progress and can verify that the necessary insurance coverage is in place.