What policies require Hardees and its affiliates to be named as Additional Insured on a primary and non-contributory basis?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
- (7) With respect to the Commercial General Liability, Automobile Liability and Umbrella/Excess Liability policies, HR and its affiliates shall be named as Additional Insured on a primary and non-contributory basis. With respect to the Commercial Property coverage, HR and its affiliates shall be named as Loss Payee.
In connection with any construction, leasehold improvements, renovation, refurbishment, or remodeling of the Franchised Restaurant, Franchisee's general contractor shall maintain Commercial General Liability insurance (with products liability and independent contractors coverage), Automobile Liability coverage for owned, leased, hired and non-owned vehicles, and Builder's Risk with limits no less than $1,000,000, with HR named as an additional insured, as well as Workers' Compensation and Employer's Liability as required by state law.
(1) Each insurance policy shall be specifically endorsed to provide that the coverages shall be primary and that any insurance carried by any additional insured or loss payee shall be excess and non-contributory.
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.
Source: Item 22 — Contracts (FDD page 85)
What This Means (2025 FDD)
According to Hardees' 2025 Franchise Disclosure Document, several insurance policies require Hardees and its affiliates to be named as additional insured on a primary and non-contributory basis. Specifically, the Commercial General Liability, Automobile Liability, and Umbrella/Excess Liability policies must include this designation. This means that in the event of a claim, Hardees' insurance coverage would be primary, and they would not have to seek contribution from the franchisee's insurance.
In addition to the general liability policies, Hardees also requires that its general contractor maintain Commercial General Liability insurance, Automobile Liability coverage, and Builder's Risk insurance with Hardees named as an additional insured in connection with any construction, leasehold improvements, renovation, refurbishment, or remodeling of the Franchised Restaurant. These policies must have limits no less than $1,000,000.
Furthermore, each insurance policy that the franchisee is required to maintain must be specifically endorsed to provide that the coverages shall be primary and that any insurance carried by any additional insured or loss payee shall be excess and non-contributory. This ensures that Hardees' interests are protected and that their coverage takes precedence over any other insurance policies. Franchisees must also provide evidence of satisfactory insurance and proof of payment to Hardees no later than 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 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.