Is the minimum insurance coverage required by Pump It Up a guarantee of sufficient coverage?

, property damage, or expense whatsoever occurring upon the Premises, or in connection with the development and/or operation of the Franchised Business. Throughout the term of this Agreement, you must obtain and maintain in full force and effect that insurance which you determine is necessary or appropriate for liabilities caused

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;
• (d) 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;
• (e) guaranteed or extended cost replacement property insurance (and contingent liability and building ordinance coverage if you or an entity controlled by you own the building in which the Franchised Business is operated) on building and business personal property including personal property of others; and
• (f) business interruption insurance adequate for a six-month period including the payments to us of our continuing royalty based on the average of your past three operating months.
• (2) In addition to the foregoing, we also recommend, but do not require, that you obtain sexual and physical abuse insurance coverage with limits of not less than $50,000 per occurrence.
• (3) 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 our minimum standards and specifications as set forth in this Agreement, the Manuals or otherwise stated to you in writing. We may periodically increase the minimum required coverage and/or modify or require different or additional insurance coverage (including reasonable excess liability insurance) at any time to reflect inflation, identification of new risks, changes in law or standards of liability, higher damage awards or other relevant changes in circumstances. You will receive written notice of such modifications and shall take prompt action to secure the additional coverage or higher policy limits. All insurance policies must name us and any affiliates that we designate and our and their respective officers and owners as additional named insureds, and provide for 30 days' prior written notice to us 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.
• (4) At least 10 days prior to commencing construction of the Franchised Business (or, if you are acquiring an existing Pump It Up Business, 10 days prior to the transfer of ownership

interests) and annually thereafter, you must submit to us a copy of your Certificates of Insurance or other evidence of you maintaining the required insurance coverage and paying those premiums. If you obtain claims-made insurance policies, we require that you 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 you in writing. If you fail or refuse to obtain and maintain the insurance we specify and/or fail or refuse to provide us with satisfactory evidence of those policies being in place, in addition to ou

Source: Item 23 — RECEIPTS (FDD pages 60–225)