Before a Mr. Sandless business opens, what documentation regarding insurance must be provided?
Mr_Sandless Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 22: CONTRACTS]
- You must provide us with a Certificate of Insurance before your Business opens and upon each renewal naming us and our respective officers, directors, employees and agents as an additional named insured.
- We should be named as an additional insured for ongoing operations as well as completed operations. This is accomplished by ISO forms CG2010 (7/04) and CG2037 (7/04) or equivalent.
- We must be named as an additional insured on a primary and non-contributory basis.
- Your insurance policies should waive all rights of subrogation against us.
- Failure to comply with our insurance requirements imposed is grounds for termination of the franchise agreement.
If you fail to obtain or maintain the required insurance, we have the right, but are not obligated, to obtain and maintain such insurance coverage on your behalf and to charge you for such coverage, together with a service fee which shall not exceed eighteen percent (18%) of the insurance premium. There is no assurance that the minimum insurance requirements will be adequate to satisfy your needs.
Source: Item 22 — CONTRACTS (FDD page 42)
What This Means (2025 FDD)
According to the 2025 Mr. Sandless Franchise Disclosure Document, a franchisee must provide a Certificate of Insurance before their business opens. This certificate must also be provided upon each renewal of the insurance policy.
The certificate must name Mr. Sandless and its officers, directors, employees, and agents as additional insured parties. Mr. Sandless should be named as an additional insured for ongoing operations as well as completed operations, which is accomplished through ISO forms CG2010 (7/04) and CG2037 (7/04) or equivalent forms. The insurance policies must also waive all rights of subrogation against Mr. Sandless, and Mr. Sandless must be named as an additional insured on a primary and non-contributory basis.
Failure to comply with these insurance requirements is grounds for termination of the Mr. Sandless franchise agreement. While Mr. Sandless has the right to obtain and maintain the required insurance coverage on the franchisee's behalf if the franchisee fails to do so, and to charge the franchisee for the coverage plus a service fee not exceeding eighteen percent (18%) of the insurance premium, there is no assurance that the minimum insurance requirements will be adequate to satisfy the franchisee's needs. This highlights the importance of franchisees securing appropriate and sufficient insurance coverage to protect their business and assets.