Can Fly Fitness increase the required minimum insurance coverage?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
Increase in Coverage.The levels and types of insurance stated herein are minimum requirements.
Franchisor reserves the right to raise the required minimum requirements for any type of insurance or add additional types of insurance requirements as Franchisor deems reasonably prudent to require.
Within thirty (30) days of any such required new limits or types of coverage, Franchisee must submit proof to Franchisor of Franchisee's coverage pursuant to Franchisor's requirements.
- 15.5 Additional Insured.
All required insurance policies shall name Franchisor and their affiliates and their members, officers, agents, and employees as additional insureds as their interests may appear.
All public liability policies shall contain a provision that the additional insureds, although named as insureds, shall nevertheless be entitled to recover under such policies on any loss caused by Franchisee or Franchisee's servants, agents, or employees.
Source: Item 22 — CONTRACTS (FDD pages 44–45)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, Fly Fitness retains the right to increase the minimum insurance requirements for franchisees. The levels and types of insurance outlined in the franchise agreement are explicitly stated as minimums, and Fly Fitness can raise these minimums or add new types of insurance coverage if deemed reasonably prudent.
This means that a prospective Fly Fitness franchisee should be aware that their insurance costs could increase during the term of their franchise agreement. It is important to factor in potential future increases when evaluating the financial feasibility of the franchise.
Fly Fitness requires franchisees to provide proof of coverage within thirty days of any changes to the insurance requirements. This ensures that franchisees maintain the necessary coverage levels mandated by Fly Fitness. Franchisees must also name Fly Fitness and its affiliates as additional insureds on all required insurance policies, protecting Fly Fitness from potential liabilities arising from the franchisee's operations.