When must a Hardees franchisee submit evidence of satisfactory insurance and proof of payment to HR?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
- D. All required insurance policies shall be in full force and effect and Franchisee shall submit to HR evidence of satisfactory insurance and proof of payment therefore no later than the date the first of the following occurs: (1) 30 days prior to the scheduled opening date of the Franchised Restaurant; (2) the date Franchisee takes possession of the Franchised Location, or (3) the date construction commences at the Franchised Location, if Franchisee is contractually obligated for the construction. On each policy renewal date thereafter, Franchisee shall again submit evidence of satisfactory insurance and proof of payment therefor to HR. The evidence of insurance shall include a statement by the insurer that the policy or policies will not be canceled or materially altered without at least 30 days' prior written notice to HR. Upon request, Franchisee also shall provide to HR copies of all or any policies, and policy amendments and endorsements.
- F. Should Franchisee, for any reason, fail to procure or maintain at least the insurance required by this Section 15, as revised from time to time pursuant to the OPM or otherwise in writing, HR shall have the immediate right and authority, but not the obligation, to procure such insurance and charge its cost to Franchisee. All out-of-pocket costs incurred by HR in obtaining such insurance on behalf of Franchisee shall be reimbursed to HR by Franchisee immediately upon Franchisee's receipt of an invoice therefor.
Source: Item 22 — Contracts (FDD page 85)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, a franchisee must submit evidence of satisfactory insurance and proof of payment to HR no later than the date the first of the following occurs: 30 days prior to the scheduled opening date of the franchised restaurant, the date the franchisee takes possession of the franchised location, or the date construction commences at the franchised location, if the franchisee is contractually obligated for the construction.
This requirement ensures that Hardees franchisees have adequate insurance coverage in place before they begin operations, protecting both the franchisee and Hardees from potential liabilities. The franchisee must also provide evidence of satisfactory insurance and proof of payment on each policy renewal date thereafter.
The evidence of insurance must include a statement from the insurer that the policy or policies will not be canceled or materially altered without at least 30 days' prior written notice to HR. Hardees also has the right to request copies of all or any policies, and policy amendments and endorsements. This allows Hardees to monitor the franchisee's insurance coverage and ensure that it remains in compliance with the franchise agreement.
If a Hardees franchisee fails to procure or maintain the required insurance, Hardees has the right, but not the obligation, to procure such insurance and charge the cost to the franchisee. The franchisee must reimburse Hardees for all out-of-pocket costs immediately upon receipt of an invoice.