For Ledgers franchises, can the insurance coverage required by Ledgers exceed the insurance coverage required by my state laws?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
eparers must obtain a paid preparer tax identification number ("PTIN") from the IRS.
Insurance**.** You must obtain and maintain, at your own expense, such insurance coverage as required by your state laws. Moreover, you must obtain and maintain insurance coverage as we require, which may exceed insurance coverage required by your state laws. All insurance policies must name us as an "additional insured" party.
Our current insurance specifications are as follows:
- i "all risk" property insurance coverage for assets of the Franchised Business;
- ii workers' compensation insurance and employer liability coverage with a minimum limit of $100,000 or higher if your state law requires;
- iii comprehensive general liability insurance which includes contractual indemnity with a minimum liability coverage of $1,000,000 per occurrence, or higher if your state law requires;
- iv business interruption insurance;
- v commercial automobile liability insurance of at least $1,000,000 or higher if your state law requires;
- vi
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 23–25)
What This Means (2025 FDD)
According to Ledgers's 2025 Franchise Disclosure Document, Ledgers franchisees must obtain and maintain insurance coverage as required by their state laws. However, Ledgers can also require franchisees to obtain and maintain insurance coverage that exceeds the coverage required by state laws. All insurance policies must name Ledgers as an "additional insured" party.
Ledgers specifies several types of insurance coverage that franchisees must carry. These include "all risk" property insurance for the assets of the franchised business, workers' compensation and employer liability coverage (with a minimum limit of $100,000 or higher if state law requires), comprehensive general liability insurance (minimum liability coverage of $1,000,000 per occurrence, or higher if state law requires), business interruption insurance, commercial automobile liability insurance (at least $1,000,000 or higher if state law requires), and professional liability insurance for errors and omissions in the amount of $1,000,000.
This means that a prospective Ledgers franchisee needs to carefully review both their state's insurance requirements and Ledgers's insurance specifications to ensure they obtain adequate coverage. If Ledgers's requirements are higher than the state's, the franchisee must meet the higher standard. This could result in higher insurance costs for the franchisee. It is important to note that the franchisee is responsible for these insurance costs.
Franchisees should consult with an insurance professional to determine the appropriate level of coverage and to obtain quotes from different insurance providers. Understanding these insurance requirements is a crucial part of assessing the overall financial investment and operational obligations of a Ledgers franchise.