What proof of insurance coverage must an Itan franchisee provide, and when must it be provided?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
You must provide us with proof of coverage: (a) prior to opening; (b) within 10 days after a policy renewal; and (c) any other time on demand. You must obtain these policies from licensed insurance carriers rated A or better by AM Best. Each policy must satisfy all requirements in the Manual and be endorsed to: (a) name us and our owners, officers and directors as additional insureds; (b) waive all subrogation rights against us; and (c) provide us with at least 30 days' prior written notice of the termination, expiration, cancellation or modification of the policy. We may disapprove any policy that fails to meet these criteria, and you must immediately secure a new policy meeting our criteria. Upon 10 days' notice, we may increase the minimum liability coverage amount of any policy and/or require different or additional types of insurance, including excess liability (umbrella) insurance, due to inflation, special risks, changes in Law or standards of liability, higher damage awards or other relevant changes in circumstances. If you fail to maintain a required policy we may, at our option, obtain the policy on your behalf. If we do so, you must promptly sign any application or other form required to obtain the policy and reimburse all premiums and other costs we incur.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, franchisees must provide proof of insurance coverage to Itan under specific circumstances. This proof must be provided (a) before opening their Itan salon, (b) within 10 days after renewing their insurance policy, and (c) at any other time upon Itan's demand.
The insurance policies must be obtained from licensed insurance carriers with a rating of A or better from AM Best. The policies must also meet all requirements outlined in Itan's Manual. Furthermore, each policy must be endorsed to include Itan and its owners, officers, and directors as additional insureds, waive all subrogation rights against Itan, and provide Itan with at least 30 days' prior written notice of any termination, expiration, cancellation, or modification of the policy.
Itan retains the right to disapprove any policy that does not meet these criteria, and the franchisee must then secure a new, compliant policy immediately. Itan also has the option to increase the minimum liability coverage amount or require different or additional types of insurance, including excess liability (umbrella) insurance, based on factors like inflation, special risks, changes in law, or higher damage awards. If a franchisee fails to maintain the required insurance policy, Itan may obtain the policy on their behalf, and the franchisee must sign any necessary forms and reimburse Itan for all premiums and costs incurred.