How will a Pump It Up franchisee be notified of modifications to insurance coverage requirements?

According to Pump It Up's 2025 Franchise Disclosure Document, Pump It Up may periodically increase the minimum required insurance coverage, modify, or require different or additional insurance coverage to reflect inflation, identification of new risks, changes in law or standards of liability, higher damage awards or other relevant changes in circumstances. Pump It Up will provide franchisees with written notice of such modifications, and the franchisee must take prompt action to secure the additional coverage or higher policy limits.

Pump It Up's current minimum insurance requirements include comprehensive general liability insurance with limits of the greater of $1,000,000 per occurrence and $2,000,000 aggregate, or those amounts required by the state or local government in which the Franchised Business is located; worker's compensation and employer's liability insurance; employment practices liability coverage; automobile liability insurance, and property damage liability, including owned, non-owned, and hired vehicle coverage, with at least $1,000,000 combined single limit, and $2,000,000 general aggregate limit; guaranteed or extended cost replacement property insurance; and business interruption insurance adequate for a six-month period including the payments to Pump It Up of their continuing royalty based on the average of the franchisee's past three operating months.

All insurance policies must be written by an insurance company that is licensed in the state where the Franchised Business is located, and must meet Pump It Up's minimum standards and specifications as set forth in the Franchise Agreement, the Manuals or otherwise stated to the franchisee in writing. All insurance policies must name Pump It Up and any affiliates that Pump It Up designates and their respective officers and owners as additional named insureds, and provide for 30 days' prior written notice to Pump It Up of a policy's material modification, cancellation or expiration. Each insurance policy shall be specifically endorsed to provide that the coverage shall be primary and that any insurance carried by any additional insured shall be excess and non-contributory.

At least 10 days prior to commencing construction of the Franchised Business (or, if the franchisee is acquiring an existing Pump It Up Business, 10 days prior to the transfer of ownership interests) and annually thereafter, the franchisee must submit to Pump It Up a copy of their Certificates of Insurance or other evidence of maintaining the required insurance coverage and paying those premiums. If a franchisee obtains claims-made insurance policies, Pump It Up requires that they obtain tail coverage for at least four years after the end of any policy period in question or as otherwise set forth in the Manuals or provided to the franchisee in writing. If a franchisee fails or refuses to obtain and maintain the insurance Pump It Up specifies and/or fails or refuses to provide Pump It Up with satisfactory evidence of those policies being in place, in addition to Pump It Up's other remedies, Pump It Up may obtain such insurance for the franchisee and the Franchised Business on the franchisee's behalf, in which event the franchisee must cooperate with Pump It Up and reimburse them for all premiums, costs and expenses they incur in obtaining and maintaining the insurance, plus a reasonable fee for their time spent in obtaining such insurance.