What section of the Southern Steer franchise agreement outlines insurance requirements?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
17. INSURANCE; INDEMNIFICATION
17.1. Franchisee's Insurance.
(a) Insurance Policies. The Franchisee must, at its expense, procure and maintain in full force and effect insurance policies, in such amounts and on such terms, as prescribed below or by the Franchisor in the Brand Manual, by an insurance company which is acceptable to and approved by the Franchisor at all times during the Initial Term of this Agreement and any Interim Period, licensed in the state where coverage is provided, and carries an A.M. Best rating of at least A-VII. The Franchisee must obtain such policies before opening the Southern Steer Business. The Franchisee must also procure and pay for all other insurance required by state or federal law, including, without limitation, workers' compensation and unemployment insurance. Nothing in this Agreement will prevent the Franchisee from purchasing insurance with coverage amounts in excess of the coverage amounts required by the Franchisor.
- (b) Coverage.
Insurance policies must insure the Franchisee, the Franchisor, and their respective Affiliates, officers, stockholders, directors, and all other parties designated by the Franchisor, as additional named insureds against any liability that may accrue against them by reason of the ownership, maintenance or operation by Franchisee of the Southern Steer Business.
- (c) Requirements.
The policies must also stipulate that the Franchisor will receive a 30-day prior written notice of cancellation, non-renewal, or elimination, and must contain endorsements by the insurance companies waiving all rights of subrogation against the Franchisor.
Original or duplicate copies of all insurance policies, certificates of insurance, or other proof of insurance acceptable to the Franchisor, including original endorsements affecting the coverage required by this Section, must be furnished to the Franchisor by the Franchisee, together with proof of payment, prior to the opening of the Southern Steer Business.
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to the 2025 Southern Steer Franchise Disclosure Document, Section 17 of the franchise agreement, titled "INSURANCE; INDEMNIFICATION," outlines the franchisee's insurance obligations. Specifically, section 17.1 details the insurance requirements for franchisees.
This section mandates that the franchisee must secure and maintain insurance policies at their own expense throughout the term of the agreement. The insurance coverage must be in the amounts and terms specified in the Brand Manual or as otherwise prescribed by Southern Steer. These policies must be obtained from an insurance company acceptable to and approved by Southern Steer, licensed in the state where coverage is provided, and holding an A.M. Best rating of at least A-VII. The franchisee is required to have these policies in place before opening their Southern Steer Business and must also cover any insurance required by state or federal law, including workers' compensation and unemployment insurance.
The required insurance policies must include Southern Steer, its affiliates, officers, stockholders, directors, and any other parties designated by Southern Steer as additional named insureds. The coverage must protect against any liability arising from the franchisee's ownership, maintenance, or operation of the Southern Steer Business. Furthermore, the policies must stipulate that Southern Steer receives a 30-day prior written notice of cancellation, non-renewal, or elimination of coverage and must include endorsements waiving all rights of subrogation against Southern Steer.
To ensure compliance, the franchisee must provide Southern Steer with original or duplicate copies of all insurance policies, certificates of insurance, or other acceptable proof of insurance, along with proof of payment, before opening the Southern Steer Business. This documentation must include original endorsements affecting the required coverage. This level of detail is typical in franchise agreements to protect the franchisor from potential liabilities related to the franchisee's operations.