What is the minimum per occurrence and aggregate limit for the Excess or Umbrella Insurance policy that Fitstop franchisees are required to carry?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
| Type of Insurance | Limits | |
|---|---|---|
| Employee Dishonesty /“3-D” | $300,000 (per Occurrence) | |
| Comprehensive Crime Insurance | ||
| Comprehensive General Liability | $2,000,000 (General Aggregate) $2,000,000 (Products/Completed Operations) | |
| Comprehensive General Liability | $1,000,000 | |
| Business Automobile Liability, including owned, | $1,000,000 (per Occurrence) | |
| hired and non-owned automobile insurance | ||
| Excess or Umbrella Insurance | $5,000,000 (per Occurrence & Aggregate) | |
| Workers Compensation Insurance | Statutory Limits | |
| Employers Liability Insurance | $1,000,000/$1,000,000/$1,000,000 |
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, franchisees are required to maintain an Excess or Umbrella Insurance policy with a minimum limit of $5,000,000 per occurrence and aggregate. This insurance coverage is in addition to other required policies such as Comprehensive General Liability, Business Automobile Liability, and Workers Compensation Insurance.
The Excess or Umbrella Insurance provides an extra layer of protection beyond the limits of the franchisee's other liability policies. Should a covered claim exceed the limits of the primary insurance policies, the Excess or Umbrella Insurance would kick in to cover the additional costs, up to its $5,000,000 limit. This can protect the franchisee from potentially devastating financial losses due to large claims or lawsuits.
Fitstop also requires that the franchisor and any designated parties be named as additional insureds on the franchisee's Comprehensive General Liability and Excess or Umbrella Insurance policies. This ensures that Fitstop is also protected under the franchisee's insurance coverage for both ongoing and completed operations. Franchisees must also provide evidence of premium payments and duplicate copies of the insurance policies to Fitstop at least 30 calendar days before opening for business or the expiration of an existing policy.
It is important for prospective Fitstop franchisees to factor in the cost of this insurance coverage when evaluating the overall investment required to start and operate a franchise. Franchisees must obtain these insurance policies from a reputable insurance company licensed to do business in the state where the franchise is located and having a Financial Size Category equal to or greater than IX and a Policyholders Rating of "A+" or "A", as assigned by Alfred M. Best and Company, Inc., unless Fitstop approves otherwise.