How is the business interruption insurance amount determined for a Pump It Up franchise?

According to Pump It Up's 2025 Franchise Disclosure Document, franchisees must maintain business interruption insurance adequate for a six-month period. The amount of coverage required is based on the average of the franchisee's past three operating months, specifically to cover the continuing royalty payments owed to Pump It Up during any interruption.

This requirement ensures that even if a Pump It Up location experiences a temporary closure due to unforeseen circumstances like natural disasters or equipment failures, the franchisor will continue to receive royalty payments. The franchisee needs to calculate their average royalty payment over the previous three months to determine the necessary coverage amount.

Prospective franchisees should carefully consider this when budgeting for insurance costs, as the required coverage will fluctuate with their revenue. It is also important to note that this is just the minimum requirement to cover royalty payments, and franchisees may want to consider additional coverage to protect their own income and expenses during a business interruption.