What are the minimum limits for Employment Practices Liability Insurance required for a Fitstop franchise?

According to Fitstop's 2024 Franchise Disclosure Document, franchisees are required to maintain Employment Practices Liability Insurance with minimum limits of $1,000,000 per occurrence, $1,000,000 per incident, and $1,000,000 in the aggregate. This insurance protects both the franchisee and Fitstop, including their officers, directors, and nominees, against liability arising from the operation of the franchise business.

Fitstop requires that they receive a 30-day written notice if the policy is canceled, modified, or terminated. Franchisees must provide Fitstop with copies of insurance policies or certificates of insurance within 30 days of issuance, along with proof of payment. These insurance coverage requirements are minimums, and Fitstop advises franchisees to independently determine if higher amounts or additional types of insurance are necessary.

If a Fitstop franchisee fails to maintain the required insurance, Fitstop has the option to obtain the insurance themselves, and the franchisee will be responsible for paying the premium costs upon demand. Failure to maintain the required insurance constitutes a material breach of the franchise agreement, potentially leading to termination. Fitstop also retains the right to increase the required coverage amounts or require different or additional coverage periodically. This is a fairly standard practice in franchising, as franchisors need to protect their brand and manage risk across the entire system.