What is the minimum aggregate commercial general liability insurance coverage a Fly Fitness franchisee must maintain?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
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Before you open for business, you must purchase and maintain the minimum insurance coverage that we specify. This includes commercial general liability insurance, including coverage for professional liability and sexual abuse of at least $1 million per occurrence and $3 million aggregate; worker's compensation coverage in the limits required by the state in which the Franchised Business is located; business interruption insurance; property insurance for the full replacement value of furniture, fixtures, equipment, vehicles, inventory, and leasehold improvements or $50,000, whichever is greater; and comprehensive automobile insurance of $1 million for any vehicle operated on behalf of the Franchised Business. Each policy must be written by a responsible carrier or carriers acceptable to us and must name us and our respective officers, directors, partners, agents, and employees as additional insured parties, as their interests may appear. We reserve the right to require additional types of insurance and coverage as prov
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 18–20)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, franchisees are required to maintain certain minimum insurance coverages. Specifically, Fly Fitness mandates that franchisees obtain commercial general liability insurance, which must include coverage for professional liability and sexual abuse. The minimum coverage required is $1 million per occurrence and $3 million in the aggregate.
In addition to commercial general liability insurance, Fly Fitness franchisees must also secure worker's compensation coverage, with limits as required by the state in which the franchise is located. Furthermore, they need to have business interruption insurance and property insurance covering the full replacement value of furniture, fixtures, equipment, vehicles, inventory, and leasehold improvements, or $50,000, whichever is greater. Comprehensive automobile insurance of $1 million is also required for any vehicle operated on behalf of the Fly Fitness business.
All insurance policies must be written by carriers acceptable to Fly Fitness, and the franchisor, along with its officers, directors, partners, agents, and employees, must be named as additional insured parties. Fly Fitness retains the right to demand additional types of insurance and coverage as deemed necessary in the Franchise Agreement. This ensures that both the franchisee and Fly Fitness are adequately protected against potential liabilities and losses.