Who must be named as additional insured parties on each insurance policy for Mr. Sandless franchisees?
Mr_Sandless Franchise · 2025 FDDAnswer from 2025 FDD Document
- 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, franchisees are required to secure insurance policies and name specific parties as additional insureds. Mr. Sandless Franchise LLC, along with its officers, directors, employees, and agents, must be included as additional insured parties on these policies. This requirement ensures that Mr. Sandless is protected from potential liabilities arising from the franchisee's operations.
The FDD specifies that Mr. Sandless should be named as an additional insured for both ongoing operations and completed operations. To achieve this, franchisees must use ISO forms CG2010 (7/04) and CG2037 (7/04) or their equivalents. Additionally, the insurance policies must be primary and non-contributory, meaning they will be the first to respond to any claims, and the insurance company waives its right to seek recovery from Mr. Sandless for any payments made under the policy.
Failure to comply with these insurance requirements can lead to termination of the franchise agreement. If a franchisee fails to obtain or maintain the necessary insurance, Mr. Sandless has the right, but not the obligation, to secure the required coverage on the franchisee's behalf and charge the franchisee for the premium, along with a service fee not exceeding 18% of the insurance premium. However, the FDD notes that the minimum insurance requirements may not be adequate to fully satisfy the franchisee's needs, so franchisees should assess their specific risks and consider obtaining additional coverage.