Regarding insurance policies, what subrogation rights waiver must be included in all insurance policies related to a Remax franchise?
Remax Franchise · 2025 FDDAnswer from 2025 FDD Document
All insurance policies must contain a waiver by the insurance carrier of all subrogation rights against REMAX Regional, RE/MAX Holdings, Inc., REMAX, LLC and other parties covered by the insurance and must contain a provision that REMAX Regional, RE/MAX Holdings, Inc. and REMAX, LLC receive 30 days prior written notice of termination, expiration, cancellation, or modification of any such policy.
All third parties that you hire shall provide evidence of general liability coverage, automobile liability coverage, workers' compensation and employer's liability coverage, and other coverages we deem necessary. Coverage will be in favor of Franchisee, REMAX Regional, and REMAX, LLC and shall include additional insured status, primary and non-contributory coverage, and waiver of subrogation.
In addition, you must also ensure that each Sales Associate in your Office obtains automobile liability insurance covering each vehicle used at any time by the Sales Associate for business purposes (the policy must also include any auto or owned, hired and non-owned automobile coverage) and use your best efforts to ensure that each such policy: (i) names REMAX Regional, RE/MAX Holdings, Inc. and REMAX, LLC (and their respective officers, directors, and employees) as additional insureds; (ii) provides coverage to REMAX Regional, RE/MAX Holdings, Inc. and REMAX, LLC on a primary and noncontributory basis; (iii) contains a waiver by the insurance carrier of all subrogation rights against REMAX Regional, RE/MAX Holdings, Inc., REMAX, LLC and other parties covered by the insurance; (iv) provides the same amount of coverage as you are required to obtain as set forth above; and (v) contains a provision that REMAX Regional, RE/MAX Holdings, Inc. and REMAX, LLC receive prior written notice of termination, expiration, cancellation or modification of such policy.
Source: Item 22 — Contracts (FDD pages 108–334)
What This Means (2025 FDD)
According to Remax's 2025 Franchise Disclosure Document, all insurance policies must include a waiver by the insurance carrier of all subrogation rights against REMAX Regional, RE/MAX Holdings, Inc., REMAX, LLC and other parties covered by the insurance. This requirement extends not only to the franchisee's insurance policies but also to those of any third parties they hire. Additionally, franchisees must use their best efforts to ensure that each Sales Associate's automobile liability insurance policy includes a waiver by the insurance carrier of all subrogation rights against REMAX Regional, RE/MAX Holdings, Inc., REMAX, LLC and other parties covered by the insurance.
In practical terms, this waiver prevents the insurance company from pursuing claims against Remax or its related entities to recover any payments made under the policy. This protects Remax from potential financial liabilities arising from incidents related to the franchisee's operations or the actions of their sales associates and third-party contractors.
For a prospective Remax franchisee, this means ensuring that all insurance policies obtained, including those for sales associates and third-party contractors, explicitly include this waiver of subrogation. Failure to comply with this requirement could lead to a breach of the franchise agreement, potentially resulting in termination. Franchisees should carefully review their insurance policies and consult with their insurance provider to confirm that the necessary waiver is in place.
Remax also reserves the right to designate a specific insurance agency or broker that franchisees must use to meet their insurance obligations, potentially impacting the franchisee's choice of insurance provider and associated costs. Franchisees must also furnish copies of insurance certificates to Remax or its designee at least 30 days prior to the effective date of the policy and annually thereafter, demonstrating compliance with all required insurance specifications.