Which section of the Focus Cfo Franchise Agreement addresses insurance requirements for the franchisee?
Focus_Cfo Franchise · 2025 FDDAnswer from 2025 FDD Document
10. LIABILITY INSURANCE; INDEMNIFICATION
- 10.1.
Business Insurance Coverage.
Focus CFO will provide Franchisee with reasonable business insurance coverage (general liability, crime, and employment practices), subject to standard limitations and indemnification provisions for a professional service business and Franchisee's ongoing compliance with Focus CFO's policies and standard operating procedures.
Franchisee acknowledges and agrees that Focus CFO does not represent or warrant that such insurance coverage is adequate to protect Franchisee and nothing in this Agreement restricts Franchisee from obtaining its own insurance.
This business insurance coverage extends only to the Area President of the Franchisee's business entity.
It does not extend to other Support Resources of the Franchisee's business entity.
Franchisee shall be responsible for ensuring it has all appropriate insurance in place to cover the services performed by all Support Resources of Franchisee.
Source: Item 9 — Franchisee's Obligations (FDD page 16)
What This Means (2025 FDD)
According to the 2025 Focus Cfo Franchise Disclosure Document, Section 10 of the Franchise Agreement, titled "Liability Insurance; Indemnification," addresses insurance requirements for franchisees. Specifically, Section 10.1 details the business insurance coverage that Focus Cfo will provide, which includes general liability, crime, and employment practices insurance, subject to standard limitations and indemnification provisions. However, Focus Cfo does not guarantee that this coverage will be adequate for the franchisee's needs, and franchisees are not restricted from obtaining their own insurance. This coverage extends only to the Area President of the Franchisee's business entity and not to other Support Resources. Franchisees are responsible for ensuring they have appropriate insurance to cover services performed by their Support Resources.
Furthermore, Section 10.2 outlines the business insurance renewal process, requiring franchisees to sign an annual statement certifying compliance with Focus Cfo's policies and procedures and disclosing any known circumstances that could lead to a legal claim against Focus Cfo. This statement must be provided within thirty days of Focus Cfo's request each year. Section 10.3 addresses indemnification, stating that Focus Cfo will indemnify franchisees for judgments, settlements, penalties, fines, or expenses incurred in proceedings where the franchisee is a party due to their role as an Area President, unless the claim results from an Adverse Event.
In addition to the above, the FDD states that Focus CFO may provide Franchisee with, in writing, minimum insurance requirements for Support Resources of Franchisee that Franchisee must follow. Focus CFO shall be named as an additional insured on the Franchisee's insurance policy. These stipulations ensure that Focus Cfo is protected from potential liabilities arising from the franchisee's operations and the actions of their support staff. Franchisees should carefully review Section 10 and related sections to understand their insurance obligations and the extent of coverage provided by Focus Cfo.