What are the minimum coverage limits for Commercial Umbrella insurance required for a Gold Star restaurant, and how does it change if liquor liability is applicable?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
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Insurance.
Before opening your Restaurant, you must obtain, and maintain at all times during the term of your franchise agreement, the following insurance coverage:
- Special Perils Insurance including theft on the Restaurant to include but not limited to all furniture, fixtures, equipment, signs (attached and unattached), exterior glass, supplies and other property used in the operation of the Restaurant (including flood and/or earthquake coverage where applicable,) for the full repair and replacement value with no coinsurance clause or applicable agreed amount.
- Boiler machinery insurance, provided any Building on the Premises contains equipment of the nature ordinarily covered by such a policy
- Flood Insurance if any material portion of the Premises is located in an area identified in the Federal Register by the Federal Emergency Management Agency as having special flood hazards
- Plate glass insurance Covering the glass in the Premises.
- Commercial General Liability Insurance covering claims for bodily injury, property damage and personal injury, death, property and fire damage, and other damaging or injurious occurrences, with a minimum per occurrence limit of $1,000,000, $1,000,000 liquor liability per occurrence if applicable and a minimum general aggregate limit of $2,000,000.
- Commercial Umbrella $1,000,000 per occurrence, $1,000,000 aggregate. $5,000,000 per occurrence if liquor liability is applicable.
- Products/Completed Operations Aggregate with a minimum coverage of $2,000,000.
- Business Interruption Insurance for actual losses sustained or 12 months.
- Worker's Compensation Insurance and Employer's Liability (STOP GAP) that complies with the statutory requirements of the state in which the Restaurant is located and Employers' Liability Insurance with a minimum limit equal to or greater than the statutory minimum limit required by state law.
- Automotive $1,000,000 Combined Single Limit (CSL) for hired and non-owned automobiles.
- Any other insurance coverage that may be required by your lease.
- Recommended: Employment Practices Liabil
Source: Item 8 — Restrictions on Sources of Products and Services (FDD pages 21–25)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, franchisees are required to maintain specific insurance coverage throughout the term of their franchise agreement. The minimum coverage for Commercial Umbrella insurance is $1,000,000 per occurrence and $1,000,000 in aggregate.
However, if the Gold Star restaurant has liquor liability, the required Commercial Umbrella insurance coverage increases significantly. In this case, the franchisee must maintain $5,000,000 per occurrence. The aggregate limit is not specified to change with liquor liability.
It is important to note that Gold Star has the right to increase the minimum coverage, decrease the maximum deductible, or require different or additional kinds of insurance to reflect inflation, changes in standards of liability, higher damage awards, or other relevant changes in circumstances. Gold Star will provide at least 30 days' written notice of any such changes. Franchisees must provide Gold Star with certificates of insurance showing compliance with the insurance requirements before commencing construction or opening their restaurant. Failure to maintain the required insurance coverage allows Gold Star to procure insurance on the franchisee's behalf and charge the franchisee for the cost plus interest.