What is the minimum amount of commercial general liability insurance that a Stretch Zone franchisee's general contractor must maintain for any construction or renovation of the Premises?
Stretch_Zone Franchise · 2025 FDDAnswer from 2025 FDD Document
bility insurance, to reflect inflation, identification of new risks, changes in law or standards of liability, higher damage awards, or other relevant changes in circumstances, if the changes are required throughout the Network including any Company-Owned Units.
Section 9.2 EVIDENCE OF INSURANCE
At least 10 days before you begin any construction of the Premises, or 10 days from the Agreement Date, if the Premises are constructed and presently owned or leased by you, you must furnish to us a certificate of insurance issued by an approved insurance company showing compliance
Source: Item 8 — Receipts. Any sale made must be in compliance with § 683(8) of the Franchise Sale Act (N.Y. Gen. Bus. L. § 680 et seq.), which describes the time period a Franchise Disclosure Document (offering prospectus) must be provided to a prospective franchisee before a sale may be made. New York law requires a franchisor to provide the Franchise Disclosure Document at the earliest of the first personal meeting or ten (10) business days before the execution of the franchise or other agreement or the payment of any consideration that relates to the franchise relationship. (FDD pages 99–263)
What This Means (2025 FDD)
According to Stretch Zone's 2025 Franchise Disclosure Document, for any construction or renovation of the premises, a franchisee must ensure their general contractor maintains commercial general liability insurance with certain coverages and limits. This insurance must include comprehensive automobile liability coverage for both owned and non-owned vehicles, builder's risk, product liability, and independent contractor's coverage. The minimum coverage amount for this commercial general liability insurance is $1,000,000.
Furthermore, the Stretch Zone franchisee is required to have both the franchisee and Stretch Zone named as additional insureds on the general contractor's commercial general liability insurance policy. This protects both the franchisee and the franchisor from potential liabilities arising from the construction or renovation work.
In addition to the commercial general liability insurance, the general contractor must also maintain workers' compensation and employer's liability insurance as required by law. This ensures that workers are protected in case of on-the-job injuries and that the franchisee is compliant with all applicable legal requirements. It is the franchisee's responsibility to ensure that their general contractor meets these insurance requirements.