How will Pump It Up notify franchisees of modifications to the minimum required insurance coverage?
Pump_It_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
All insurance policies must be written by an insurance company that is licensed in the state where your Franchised Business is located. All insurance policies must also meet our minimum standards and specifications as provided here in the FDD, in your Franchise Agreement, in the Manuals, or otherwise stated to you in writing. We may from time to time increase the minimum required coverage and/or modify or require different or additional insurance coverage (including an additional umbrella liability insurance policy) 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. We will provide you with written notice of such modifications and you must take prompt action to secure the additional coverage or higher policy limits. All insurance policies must name us and any affiliates we designate as additional named insureds and provide for 30 days' prior written notice to us of a policy's material modification, cancellation or expiration.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 25–29)
What This Means (2025 FDD)
According to Pump It Up's 2025 Franchise Disclosure Document, Pump It Up may modify or require different or additional insurance coverage 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. Pump It Up will provide franchisees with written notice of such modifications, and franchisees must take prompt action to secure the additional coverage or higher policy limits.
It is standard practice in franchising for franchisors to mandate minimum insurance coverage to protect the brand and the network from potential liabilities. The FDD specifies that all insurance policies must name Pump It Up and any affiliates they designate as additional named insureds and provide for 30 days' prior written notice to them of a policy's material modification, cancellation, or expiration. This ensures that Pump It Up is informed of any changes to a franchisee's insurance coverage that could affect the franchisor's risk exposure.
Pump It Up also requires franchisees to submit copies of their Certificates of Insurance or other evidence that they are maintaining the required insurance coverage and paying premiums. This must be done at least 10 days prior to commencing construction of the Franchised Business or 3 days before taking ownership of an existing open Pump It Up Franchised Business, and annually thereafter. If a franchisee fails to obtain and maintain the specified insurance, Pump It Up has the right to obtain such insurance for the franchisee, and the franchisee must reimburse Pump It Up for all associated costs and expenses, including a reasonable fee for their time incurred in obtaining such insurance.