Does Endless Summer Sweets require Workers Compensation coverage?
Endless_Summer_Sweets Franchise · 2024 FDDAnswer from 2024 FDD Document
reement).
- B. Insurance. You must obtain insurance as described in the Franchise Agreement and in our 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
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 14–16)
What This Means (2024 FDD)
According to Endless Summer Sweets's 2024 Franchise Disclosure Document, franchisees are required to obtain Workers Compensation coverage as mandated by state law. This requirement is part of the broader insurance obligations outlined in the Franchise Agreement and the Manual. Additionally, Endless Summer Sweets requires franchisees to maintain other insurance policies, including coverage for property loss, business interruption, commercial general liability, and business automobile liability.
The Workers Compensation coverage requirement means that franchisees must comply with the specific state regulations regarding insurance for their employees. The other insurance policies franchisees must obtain include (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.
Endless Summer Sweets also mandates that all insurance policies, except for Workers Compensation, list Endless Summer Sweets and its affiliates as additional insured parties. These policies must include a waiver of subrogation in favor of Endless Summer Sweets and its affiliates, be primary and non-contributing with any insurance carried by them, and stipulate that Endless Summer Sweets receives 30 days' prior written notice of cancellation. This ensures that Endless Summer Sweets is protected from potential liabilities and is informed of any changes to the franchisee's insurance coverage.
For a prospective franchisee, this means understanding and budgeting for the costs associated with these insurance requirements. The specific cost of Workers Compensation will vary depending on the state and the number of employees. Franchisees should consult with insurance professionals to ensure they obtain the necessary coverage to comply with both Endless Summer Sweets's requirements and state law.