Under what circumstances can Monicals Pizza increase the minimum liability protection requirement annually?

According to Monicals Pizza's 2025 Franchise Disclosure Document, Monicals Pizza has the right to increase the minimum liability protection requirement annually. This increase must be reasonable and reflect certain conditions.

The specific circumstances that could trigger an increase include inflation, which erodes the purchasing power of existing coverage limits, changes in standards of liability, reflecting evolving legal precedents and increased potential for larger claims, future damage awards, indicating a trend toward higher payouts in liability cases, and other relevant changes in circumstances, a catch-all provision allowing for adjustments based on unforeseen factors impacting risk and insurance needs.

For a prospective Monicals Pizza franchisee, this means that the initial insurance costs outlined in the FDD are subject to change. Franchisees should budget for potential annual increases in their insurance premiums to maintain the required coverage levels. It is important to discuss with Monicals Pizza what specific benchmarks or criteria they use to determine these annual adjustments to liability coverage, allowing for better financial planning and risk management.