Who must approve the insurance carriers used by Gokhale Method franchisees?
Gokhale_Method Franchise · 2024 FDDAnswer from 2024 FDD Document
You must maintain in force commercial general liability insurance protecting you, us, and the parties' respective officers, directors, partners, agents and employees against any demand or claim with respect to personal injury, death or property damage, business interruption, or any loss, liability or expense whatsoever arising or occurring upon or in connection with the Franchised Business, including, but not limited to, comprehensive general liability insurance, property insurance (including, but not limited to, fire, vandalism, and malicious mischief insurance for the replacement value of the Franchised Business and its contents), casualty insurance, business interruption insurance, statutory workers' compensation insurance, and automobile insurance coverage for all vehicles used in connection with the operation of the Franchised Business. All insurance policies must: (1) be issued by carriers approved by us; (2) contain the types and minimum amounts of coverage, exclusions and maximum deductibles as we prescribe periodically; (3) name us and our Affiliates as additional insureds; (4) provide for 30 days' prior written notice to us of any material modification, cancellation or expiration of such policy; and (5) include such other provisions as we may require periodically. We do not require you to purchase insurance from any particular source.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 15–17)
What This Means (2024 FDD)
According to Gokhale Method's 2024 Franchise Disclosure Document, the insurance carriers used by franchisees must be approved by Gokhale Method itself. Franchisees are required to maintain commercial general liability insurance, property insurance, casualty insurance, business interruption insurance, statutory workers' compensation insurance, and automobile insurance coverage.
The FDD specifies several requirements for these insurance policies. The insurance must be issued by carriers approved by Gokhale Method. The policies must contain the types and minimum amounts of coverage, exclusions, and maximum deductibles that Gokhale Method prescribes periodically. Gokhale Method and its affiliates must be named as additional insureds. The insurance provider must give Gokhale Method 30 days' prior written notice of any material modification, cancellation, or expiration of the policy. Finally, the policies must include any other provisions that Gokhale Method may require periodically.
While Gokhale Method mandates these insurance requirements and carrier approval, the FDD states that franchisees are not required to purchase insurance from any particular source. Franchisees must also ensure their coverage meets or exceeds the minimums required by their state, if those are greater than the amounts Gokhale Method specifies. Additionally, landlords for the locations where classes are conducted may have their own insurance coverage requirements that apply in addition to Gokhale Method's requirements.