When must an Extreme Art Studio franchisee furnish copies of insurance certificates to the franchisor?

According to Extreme Art Studio's 2024 Franchise Disclosure Document, a franchisee must furnish copies of their insurance certificates or other evidence of maintaining insurance coverage and paying premiums at least 30 days prior to opening their studio. Additionally, they must provide these documents routinely as requested by Extreme Art Studio.

This requirement ensures that the franchisee has obtained the necessary insurance coverage before commencing operations, protecting both the franchisee and Extreme Art Studio from potential liabilities. The 30-day advance notice allows Extreme Art Studio to review the insurance policies and confirm that they meet the required coverage amounts and terms.

The franchisor also retains the right to request these documents routinely, enabling them to monitor ongoing compliance with insurance requirements throughout the term of the franchise agreement. Failure to provide the required insurance documentation can result in Extreme Art Studio obtaining the insurance on behalf of the franchisee, with the franchisee responsible for reimbursing all premiums plus a 20% fee for the franchisor's costs and time incurred.