What is the minimum aggregate limit required for the comprehensive general liability insurance for an Ella Cafe franchise?
Ella_Cafe Franchise · 2024 FDDAnswer from 2024 FDD Document
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Insurance
You must obtain and maintain insurance policies protecting you and us and our affiliates as additional insureds on a primary non-contributory basis. The insurance must be underwritten by insurers licensed and admitted to write coverage in the state in which the Coffee House is located and with a rating of "A" or better by the A.M. Best Company's rating guide. These policies must include the coverage that we require, which currently includes:
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- Coverage against direct physical loss or damage to real and personal property, including improvements and betterments, written on a special form peril basis, including flood and earthquake,if the relevant property is situated in a flood or earthquake zone, in an amount equal to 100% of the Franchised Businesses property value;
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Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 18–22)
What This Means (2024 FDD)
According to Ella Cafe's 2024 Franchise Disclosure Document, franchisees must maintain comprehensive general liability insurance with specific coverage limits. This insurance must be written on an occurrence basis and extended to include contractual liability, products and completed operations, and personal and advertising injury.
The minimum required limit for combined bodily injury and property damage is $1,000,000 per occurrence. Additionally, the policy must have an aggregate limit of at least $2,000,000. This means that while each individual incident is covered up to $1,000,000, the total coverage available under the policy for all incidents within a policy period is capped at $2,000,000.
It is important to note that Ella Cafe requires franchisees to name them and their affiliates as additional insureds on a primary non-contributory basis. The insurance must be underwritten by insurers licensed and admitted to write coverage in the state in which the Coffee House is located and with a rating of "A" or better by the A.M. Best Company's rating guide. Franchisees must also furnish proof of insurance to Ella Cafe before beginning operation of their Coffee House. Franchisees should consult with an insurance professional to ensure they obtain adequate coverage to meet these requirements and protect their business.