What are the worker's compensation insurance limits required for a Kidokinetics business?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
s Manual.
You must obtain the insurance coverage required under the Franchise Agreement, as follows: (i) comprehensive general liability insurance in the amount of at least $1,000,000 per occurrence and $2,000,000 in the aggregate, or in the event you lease commercial office space or storage space, such amount as required by your lease or state laws; (ii) umbrella excess liability coverage in an amount equal to $1,000,000 combined single limit coverage; (iii) automobile insurance in the amount of at least a combined single limit for bodily and property damage of $100,000, or greater if required by state law; and, if you have employees, statutory worker's compensation insurance in the limits required by state law; (iv) hired-non owned automobile insurance; (v) crime insurance for employee dishonesty in the amount of $5,000 combined single limit; (vi) sexual abuse and molestation coverage; (vii) accident
policy; and (viii) workers compensation with $1,000,000 limits or such additional limits as required by state law.
The insurance company must be authorized to do business in the state where your Kidokinetics Business is located and must be approved by us. It must also be rated "A" or better by A.M. Best & Company, Inc. We may periodically increase the amount of coverage required under these insurance policies and/or require different or additional insurance coverage at any time. All insurance policies must name us and any affiliates we designate as additional named insured parties. Your policy must provide that the insurer will not cancel or materially alter the policies without giving us at least 30 days' prior writt
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 22–24)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, franchisees must obtain statutory worker's compensation insurance if they have employees. The minimum limits for this insurance are those required by state law. Additionally, Kidokinetics requires workers compensation with $1,000,000 limits or such additional limits as required by state law.
Kidokinetics also mandates several other insurance coverages. These include comprehensive general liability insurance at a minimum of $1,000,000 per occurrence and $2,000,000 in the aggregate (or higher if required by lease or state laws for commercial/storage space), umbrella excess liability coverage of $1,000,000, and automobile insurance with a combined single limit of $100,000 (or more, depending on state law). Franchisees must also carry hired/non-owned automobile insurance, crime insurance for employee dishonesty ($5,000 limit), sexual abuse and molestation coverage, and an accident policy.
The insurance company providing these policies must be authorized to operate in the state where the Kidokinetics business is located and have an "A" rating or better from A.M. Best & Company, Inc. Kidokinetics and any designated affiliates must be named as additional insured parties on all policies. Furthermore, the insurance provider must give Kidokinetics at least 30 days' prior written notice before canceling or materially altering any of the policies.
Kidokinetics retains the right to increase the required coverage amounts or mandate different or additional insurance coverage at any time. This means a franchisee's insurance costs could potentially rise during the franchise term. It is important for prospective franchisees to factor in these potential increases when assessing the overall cost of operating a Kidokinetics franchise.