- Business Insurance

Franchise Insurance

Whether you are the Franchisor or the Franchisee, having the right Franchise Insurance for your needs is critical. Protect yourself, your family, your business, your property and your employees for unexpected events.

As a Franchisee, a good understanding of your relationship with your Franchisor will give you the information you need to in order to know what insurance coverage is required by you. You may need coverage for special circumstances that are unique to your industry. For example, you may need Food Spoilage Insurance if you are operating a restaurant or grocery store. Depending on what type of franchise you will be operating, you will need custom coverage for unique perils as well as many of the same types of insurance of other businesses.

Some insurance policies that are common for all businesses are Property Insurance, General Liability Insurance and Professional Liability/Errors and Omissions Insurance, these types of policies will provide coverage for your building, equipment and products on hand as well as injuries to another person, malpractice and breach of contract.

General Liability Insurance gives you general third-party liability coverage in the event that you are legally responsible for injuries to another person, personal injury such as slander and libel, medical expenses or damage to property. This will include if your product injures someone or does property damage.

Professional liability/errors and omissions insurance covers you, your partners, your employees and your subcontractors, usually worldwide (as long as the suit is brought in the United States). Two major areas of coverage are: malpractice for failing to maintain accepted standards of care as a professional or company and breach of contract. Policies cover legal defense costs, court costs and court judgements against you up to the limits of your coverage. A personal injury rider gives coverage against claims of slander, libel and invasion of privacy. You can take out additional coverage to protect you from allegations of copyright and intellectual property infringements. The terms of your contract or your investors may require you to have professional liability and errors and omissions insurance.

You may be required to provide insurance coverage for you employees such as Workers Compensation and Health Insurance. Workers Compensation Insurance is required by most states, it protects your employees in the event that they get injured or become ill, it also protects you from lawsuits due to negligence. The premiums are priced by region as well as the class of employees you have, worker’s that are at a higher rate of injury will cost more in premiums whereas worker’s that are at a lower rate of injury such as secretaries will cost less in premiums.

As a business owner you are not required by federal or state law to provide health, dental or other benefits to your employees. However by offering a competitive benefits package of group health and dental insurance, as well as life, disability and even long term care insurance, you can make your company attractive to potential recruits and retain valued employees.

As a franchisor you want to protect what you have built up. Depending on your industry, your needs will require an insurance agent or broker that has experience providing insurance packages to Franchise Businesses. To protect yourself from vicarious liability make sure you carry enough General Liability Insurance as well as having a franchise agreement that requires your Franchisees are carrying adequate General Liability Insurance.