What are the minimum standards for insurance companies providing coverage to a Pump It Up franchise?
Pump_It_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
- (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 our other remedies, we may (but need not) obtain such insurance for you and the Franchised Business on your behalf, in which event you must cooperate with us and reimburse us for all premiums, costs and expenses we incur in obtaining and maintaining the insurance, plus a reasonable fee for our time spent in obtaining such insurance.
Source: Item 23 — RECEIPTS (FDD pages 60–225)
What This Means (2025 FDD)
According to the 2025 Pump It Up FDD, all insurance policies must be written by an insurance company that is licensed in the state where the franchised business is located. These policies must also meet Pump It Up's minimum standards and specifications as outlined in the Franchise Agreement, the manuals, or in writing.
Pump It Up may periodically increase the minimum required coverage or modify insurance requirements to reflect inflation, new risks, changes in law, higher damage awards, or other relevant changes. Franchisees will receive written notice of these changes and must promptly secure the additional coverage or higher policy limits.
All insurance policies must name Pump It Up and any designated affiliates, along with their officers and owners, as additional named insureds. The policies must provide for 30 days' prior written notice to Pump It Up in case of material modification, cancellation, or expiration. Additionally, each policy should be specifically endorsed to ensure that the coverage is primary and that any insurance carried by any additional insured is excess and non-contributory.
Before starting construction or transferring ownership of an existing Pump It Up business, and annually thereafter, franchisees must provide copies of their Certificates of Insurance to Pump It Up. If claims-made insurance policies are used, franchisees must obtain tail coverage for at least four years after the policy period ends. If a franchisee fails to maintain the specified insurance, Pump It Up has the option to obtain insurance on their behalf, with the franchisee responsible for reimbursing all premiums, costs, and expenses, plus a reasonable fee for Pump It Up's time.