What is the duration of Business Interruption Insurance coverage required for a Gold Star franchise?

According to Gold Star's 2025 Franchise Disclosure Document, franchisees must obtain Business Interruption Insurance for either actual losses sustained or for a period of 12 months. This insurance coverage is designed to protect the franchisee from financial losses in the event that the restaurant is temporarily unable to operate due to unforeseen circumstances such as a fire, natural disaster, or other covered events.

The requirement to maintain Business Interruption Insurance is a standard practice in the franchise industry, as it helps to mitigate the financial impact of unexpected disruptions to the business. By having this insurance, Gold Star franchisees can ensure that they have the resources to cover ongoing expenses, such as rent, utilities, and employee wages, while the restaurant is being repaired or rebuilt.

The franchisee has the option to choose coverage for actual losses sustained, which would cover the specific amount of financial loss incurred during the interruption period, or a fixed 12-month period. The choice between these options may depend on factors such as the franchisee's risk tolerance, the potential duration of business interruptions, and the cost of the insurance coverage. Franchisees should carefully evaluate their individual circumstances and consult with an insurance professional to determine the most appropriate level of coverage for their Gold Star restaurant.