Can Floors To Go's insurance limit the liability coverage of the franchisee's policy?
Floors_To_Go Franchise · 2025 FDDAnswer from 2025 FDD Document
Prior to commencement of business with us, you shall procure, at your sole expense, an insurance policy or policies acceptable to us protecting you and us against any loss, liability, or expense whatsoever from personal injury, death, or product liability arising from, or occurring upon, or in connection with such premises, or by reason of your operation of your Showroom.
You shall maintain such policy or policies in full force and effect during the term of this Agreement.
- a.
Your insurance policy shall cover those risks as usually insured against by persons operating like properties in localities where the property operated by you is located, including automobile insurance, in amounts sufficient to prevent you from becoming a coinsurer within the terms of the policy or policies in question.
- b.
The insurance afforded by the policy or policies respecting liability shall not be limited in any way by reason of any insurance, that may be maintained by us.
- c. A Certificate of Insurance showing compliance with the foregoing requirements shall be furnished by you to us at least annually.
Source: Item 23 — RECEIPTS (FDD pages 47–204)
What This Means (2025 FDD)
According to the 2025 Floors To Go FDD, the insurance policy or policies respecting liability that the franchisee obtains cannot be limited in any way by reason of any insurance that Floors To Go may maintain.
Floors To Go requires franchisees to procure and maintain an insurance policy, at their own expense, that is acceptable to Floors To Go. This policy must protect both the franchisee and Floors To Go against any loss, liability, or expense from personal injury, death, or product liability arising from the operation of the franchisee's showroom.
The franchisee's insurance policy should cover risks typically insured against by similar businesses in the franchisee's locality, including automobile insurance. The coverage amounts must be sufficient to prevent the franchisee from becoming a coinsurer under the policy terms. The franchisee must furnish Floors To Go with a Certificate of Insurance annually to demonstrate compliance with these insurance requirements.