When are the insurance costs due for a Sonesta Select Sonesta Essential hotel?
Sonesta_Select_Sonesta_Essential Franchise · 2025 FDDAnswer from 2025 FDD Document
t needed for the location, and may exceed the estimates indicated.
- Note 23 You must procure and maintain, at your expense, insurance of the types and in the minimum amounts we specify, whether in the Brand Manual or otherwise in writing. This insurance must be with insurers having minimum ratings we specify, name as additional insureds the parties we specify, and carry the endorsements and notice requirements we specify, whether in the Brand Manual or otherwise in writing. Insurance premiums vary widely by reason of location,
size of hotel, number of employees, insurance carrier, your creditworthiness, market conditions, and type of coverage purchased and are difficult to estimate. The low end of the estimate for a conversion assumes you already have most of the specified minimum insurance. For Sonesta Select-branded hotels located in Florida, we estimate the high end of the estimate to be $71,900 for conversions and $236,700 for new constructions. For Sonesta Essential-branded hotels located in Florida, we estimate the high end of the estimate to be $34,750 for conversions and $136,450 for new c
Source: Item 7 — ESTIMATED INITIAL INVESTMENT SONESTA SELECT (Note 1) – 125 ROOMS (FDD pages 36–46)
What This Means (2025 FDD)
According to the 2025 FDD, the timing of insurance cost payments for a Sonesta Select Sonesta Essential hotel is not explicitly detailed. However, Note 23 in Item 7 states that franchisees must procure and maintain insurance of the types and minimum amounts specified by Sonesta Select Sonesta Essential, and that insurance premiums vary widely. The FDD does not specify when these insurance payments are due.
Given the lack of specific information on payment timing, prospective franchisees should clarify with Sonesta Select Sonesta Essential when insurance payments are due—whether they are due annually, quarterly, or on another schedule. Understanding the payment schedule is crucial for budgeting and financial planning.
It is also important to note that the insurance must be with insurers having minimum ratings specified by Sonesta Select Sonesta Essential, and must name the parties they specify as additional insureds, and carry the endorsements and notice requirements they specify. The cost of insurance can vary significantly based on factors such as location, size of the hotel, number of employees, insurance carrier, creditworthiness, market conditions, and type of coverage purchased.