What is the estimated range for insurance costs in the initial investment for a Punch King Fitness franchise?
Punch_King_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
| TYPE OF EXPENDITURE | AMOUNT | METHOD OF PAYMENT | WHEN DUE | TO WHOM | |
|---|---|---|---|---|---|
| PAYMENT IS MADE | |||||
| Insurance7 | $1,000 to $2,000 | As incurred | Before Beginning Operations | Insurance Companies |
7 You must purchase insurance in the following amounts and coverage: General Liability in the amount of $1,000,000. The amounts you pay for insurance are typically non-refundable. You should inquire about the cancellation and refund policy of the insurance carrier or agent at or before the time of purchase.
The insurance will not be limited in any way because of any insurance we maintain. Maintenance of the required insurance will not diminish your liability to us under the indemnities contained in the franchise agreement. The policy or policies will insure against our vicarious liability for actual and (unless prohibited by applicable law) punitive damages assessed against you.
We may require you to increase the minimum limits of and types of coverage to keep pace with regular business practice and prudent insurance custom.
We may require you to increase the minimum limits of and types of coverage to keep pace with regular business practice and prudent insurance custom.
Your insurance policies must insure us, you, and our respective affiliates, subsidiaries, owners, officers, directors, partners, members, employees, servants, and agents against any loss, liability, products liability, personal injury, death, or property damage that may accrue due to your operation of your Business. Your policies of insurance will contain a separate endorsement naming us and our affiliates as additional named insureds. You are required to submit an insurance certificate to our office on an annual basis.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 16–22)
What This Means (2024 FDD)
According to Punch King Fitness's 2024 Franchise Disclosure Document, the estimated cost for insurance during the initial investment phase ranges from $1,000 to $2,000. This payment is typically made before beginning operations to insurance companies. Punch King Fitness requires franchisees to purchase general liability insurance in the amount of $1,000,000.
The FDD specifies that these insurance payments are typically non-refundable, so prospective franchisees should inquire about the cancellation and refund policies of the insurance carrier or agent before purchasing a policy. Franchisees must ensure that their insurance policies cover Punch King Fitness, its affiliates, subsidiaries, owners, officers, directors, partners, members, employees, servants, and agents against potential losses, liabilities, personal injury, death, or property damage resulting from the operation of the Punch King Fitness business.
Moreover, Punch King Fitness requires franchisees to submit an insurance certificate annually and may also require franchisees to increase the minimum limits and types of coverage to align with standard business practices and prudent insurance customs. The insurance policy must include a separate endorsement that names Punch King Fitness and its affiliates as additional insured parties. This ensures that the franchisor is protected against vicarious liability for actual and punitive damages assessed against the franchisee, unless prohibited by law.