When must a Gold Star franchisee procure general insurance?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
ording to the terms of this Agreement.
- 17.4 Securities Legend. FRANCHISEE, if it is a corporation or limited liability company, shall issue no securities upon the face of which the printed legend in the following form and substance does not legibly and conspicuously appear: "The transfer of these [shares/interests/units] is subject to the terms and conditions of one or more Franchise Agreements with Gold Star Chili, Inc. Reference is hereby made to such Franchise Agreement(s) and to the restrictive provisions of the Articles and Regulations of this [corporation/limited liability company]. Copies of such Agreements and restrictions are available at the offices of the [corporation/limited liability company]."
18. INSURANCE.
18.1 General Insurance. FRANCHISEE shall procure before the commencement of construction of the Retail Location and maintain in full force and effect during the term of this Agreement and any extension or renewal thereof, at its sole cost and expense, an insurance policy or policies protecting FRANCHISEE and the COMPANY and their respective officers, directors and employees against any and all losses, liabilities, claims, costs and expenses from fire, personal injury, theft, death, property damage, or other damaging or injurious occurrence, arising out of or in connection with the condition, operation, use or occupancy of the Business and the Retail Location. The COMPANY shall be named as an additional insured in all such policies and there shall be no subrogation of any person to any claims against the COMPANY. Such policy or policies shall be written by a responsible insurance company or companies and shall be in such form and contain such limits of liability as shall be satisfactory to the COMPANY. Such policy or policies shall conform with the requirements set forth in the Manual or otherwise in writing from the COMPANY.
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, a franchisee must procure general insurance before starting construction of the retail location. This insurance must remain in full effect throughout the term of the Franchise Agreement, including any extensions or renewals. The franchisee is responsible for covering all costs associated with this insurance.
The general insurance policy must protect both the franchisee and Gold Star, including their respective officers, directors, and employees, against losses, liabilities, claims, costs, and expenses related to fire, personal injury, theft, death, property damage, or any other damaging events arising from the business's operation, use, or occupancy of the retail location. Gold Star must be named as an additional insured on all policies, and there should be no subrogation of claims against Gold Star.
The insurance policy must be written by a responsible insurance company, and the form and liability limits must be satisfactory to Gold Star. The policy must also comply with the requirements outlined in the manual or in writing from Gold Star. The public liability insurance should not be limited by any insurance maintained by Gold Star. Additionally, before construction begins and before the retail location opens, the franchisee must provide certificates of insurance to Gold Star, demonstrating compliance with these insurance requirements. These certificates must state that the policies cannot be canceled or altered without at least thirty days' prior written notice to Gold Star.