What is the minimum employment practices liability coverage requirement for a Pump It Up franchise?
Pump_It_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 23: RECEIPTS]
by or occurring in connection with the development or operation of the Franchised Business, which shall include, at a minimum, insurance coverage in the amounts and covering the risks we periodically specify in the Manuals or otherwise in writing. Our minimum insurance requirements are not representations or warranties that such coverage is sufficient for the operation of your Franchised Business. Our requirements only represent the minimum coverage for your Franchised Business that we deem acceptable to protect our interests. Our current minimum insurance requirements are as follows:
(a) comprehensive general liability insurance with limits of the greater of (i) $1,000,000 per occurrence and $2,000,000 aggregate; and (ii) those amounts required by the state or local government in which your Franchised Business is located;
(b) worker's compensation and employer's liability insurance as well as such other insurance as may be required by statute or rule of the state in which the Franchised Business is located and operated;
(c) employment practices liability coverage;
Source: Item 23 — RECEIPTS (FDD pages 60–225)
What This Means (2025 FDD)
According to Pump It Up's 2025 Franchise Disclosure Document, franchisees are required to maintain employment practices liability coverage. However, the specific minimum coverage amount is not explicitly stated in Item 23. Instead, the FDD indicates that the minimum insurance requirements, including the specifics for employment practices liability coverage, are detailed in the Pump It Up manuals or otherwise provided in writing.
This means that prospective Pump It Up franchisees must consult the operations manuals or directly communicate with the franchisor to determine the exact amount of employment practices liability coverage required. The franchisor retains the right to modify or increase the minimum required coverage at any time to reflect inflation, the identification of new risks, changes in law or standards of liability, higher damage awards, or other relevant changes in circumstances.
It is important for potential franchisees to understand that Pump It Up's minimum insurance requirements are not representations or warranties that such coverage is sufficient for the operation of their franchised business. The requirements only represent the minimum coverage that Pump It Up deems acceptable to protect its own interests. Franchisees are responsible for determining if additional coverage is necessary for their specific circumstances.
Furthermore, franchisees must ensure that all insurance policies are written by an insurance company licensed in the state where the franchised business is located and that Pump It Up and its affiliates are named as additional insureds. Franchisees must also provide Pump It Up with copies of their Certificates of Insurance at least 10 days prior to commencing construction (or transfer of ownership) and annually thereafter.