Can Mr. Sandless modify the required insurance policies and amounts for franchisees?
Mr_Sandless Franchise · 2025 FDDAnswer from 2025 FDD Document
rtising or marketing material, within time frames prescribed by us, at your sole cost and expense.
14. INSURANCE
At all times during the term of this Agreement and at your own expense, you must obtain and keep in force the insurance policies with minimum coverage limits that we specify. We reserve the right to modify the required policies and amounts, and you must comply with each such change. As of the Effective Date, you must maintain at least the minimum following insurance coverages:
- o General Liability including Personal and Advertising Liability is required with limits of $500,000 per occurrence and $1,000,000 aggregate limit, with a per project aggregate. The policy should include contractual liability covering claims from both direct and vicarious liability.
- o Per Project Aggregate. This will provide you with a separate aggregate limit of liability for each active project.
- o On-Site Limited Warranty Care, Custody, Control Coverage. This insurance is intended to provide you with coverage for property damage to real or personal property of others while in the care, custody, or control of the franchisee. Also provides limited coverage for your work.
- o Property coverage. Any owned or leased property, including equipment used at various jobsites, should be covered by a comprehensive property insurance policy.
- o Auto Liability is required with limits of $500,000 Combined Single Limit on all owned, hired and non-owned vehicles. Autos should be titled and registered in your company name.
- o Workers Compensation/Employers Liability with state statutory limits.
- o Employer Practices Liability Insurance that names Franchisor as co-defendant in the amount of One Million Dollars ($1,000,000) for employment wrongful acts, including third party liability for harassment and discrimination of non-employees.
Each policy shall be written by an insurance company acceptable to us, and shall name us
Source: Item 22 — CONTRACTS (FDD page 42)
What This Means (2025 FDD)
According to Mr. Sandless's 2025 Franchise Disclosure Document, franchisees are required to maintain specific insurance coverage. These include General Liability coverage with limits of $500,000 per occurrence and $1,000,000 aggregate, Auto Liability with a $500,000 Combined Single Limit, Workers Compensation/Employers Liability with state statutory limits, and Employer Practices Liability Insurance of $1,000,000.
Mr. Sandless requires that each policy be written by an insurance company acceptable to them. Additionally, Mr. Sandless, its affiliates, officers, directors, agents, attorneys, and employees must be named as additional insured parties, and all policies must contain a waiver of subrogation in favor of these additional insureds. Franchisees must provide renewal certificates each year.
The insurance policies must stipulate that they cannot be canceled, terminated, modified, or reduced in coverage without providing Mr. Sandless with thirty days' prior written notice. This ensures that Mr. Sandless is informed of any changes to the franchisee's insurance coverage, allowing them to take necessary actions to protect their interests. While the FDD specifies the types and amounts of required insurance, it does not explicitly state whether Mr. Sandless can modify these requirements. A prospective franchisee should seek clarification from Mr. Sandless regarding their ability to change the required insurance policies and amounts during the franchise term.