Most franchisors operate under a dangerous misconception regarding insurance. They believe that insurance requirements are simply a checklist item—a few paragraphs to be inserted into the Franchise Disclosure Document, filed away, and forgotten until a renewal comes up a year later. This assumption is one of the most expensive operational mistakes a franchise system can make. Insurance requirements are not just administrative paperwork. They are the structural steel that hold

Most franchisors answer that question with a template. They copy a section from another FDD, drop in a few limits, mention “general liability,” “property,” maybe “auto,” and call it a day. It looks official. It sounds legal. It feels sufficient. Until something goes wrong. A roof leak that ruins a build-out.  A vehicle accident that kills someone.  A fryer fire that shuts down a restaurant for 14 months.  A cyber scam that drains $50,000.  A harassment claim that names the fr

Key Takeaways (Read This First) “Joint employer coverage” does not exist.  It’s not a real insurance product, not a General Liability endorsement, and not something any agent can simply “add.” Joint-employer exposure is unavoidable in franchising.  Plaintiffs regularly name franchisors in lawsuits involving franchisee employees. EPLI is the only  place joint-employer-type protection is insurable , and only through two specific, rare endorsements. Most franchisees do not carry

An actionable, in-depth playbook for maximizing the duty to defend through choice of law, contract design, and operational discipline. Key Takeaways Franchisor E&O fails most often at the duty-to-defend gate.  Carriers build predictable “exit ramps” (subject-matter bars, contractual carve-outs, retroactive dates, fraud exclusions) and rely on jurisdictional rules that let them deny defense early. Jurisdiction is your highest-impact lever.  Choice-of-law and forum selection cl