HOME SERVICES · ALL TRADES
HOME SERVICE
FRANCHISE
INSURANCE
Your franchise agreement tells you what coverage to buy. It does not tell you what coverage protects your investment. That distinction matters more in home services than anywhere else in franchising.
166 home service franchise brands covered · Updated 2026
166
FRANCHISE BRANDS WITH FULL FDD-BASED COVERAGE ANALYSIS
4
COVERAGE GAPS THE TYPICAL HOME SERVICE FDD LEAVES UNADDRESSED
188
FDD INSURANCE SECTIONS REVIEWED AND EXTRACTED
14 mo.
AVERAGE TIME BEFORE A COMPLETED OPERATIONS CLAIM SURFACES AFTER THE JOB CLOSES
BROWSE BY TRADE
FIND YOUR FRANCHISE BRAND
Every page is built from the actual FDD — exact entity names, exact limits, exact endorsements. Not generic insurance advice.
If your brand is not yet in the directory, contact Rikor directly for a brand-specific review. We cover every major home service franchise system.
THE CORE PROBLEM
THE FDD IS THE FLOOR. NOT THE CEILING
Your franchise agreement was written to protect the franchisor's system. It was not written to ensure the franchisee who drained their 401k and put their family's financial future into this business is fully protected.
Every article on this site answers two questions: how do you become compliant with your FDD, and what actually protects what you built. Those are not the same question.
Completed operations coverage — how most plumbing, HVAC, and electrical claims arrive
Contractor's pollution liability — the gap most agents don't explain
Subcontractor certificate monitoring — the audit exposure most franchisees don't see coming
Hired and non-owned auto — the gap in every commercial fleet program
74%
of home service franchise claim denials involve an exclusion the franchisee didn't know existed when they bought the policy.
$340K
Average completed operations claim in plumbing and HVAC — the kind that arrives 14 months after the job, when the policy has already renewed.
THE CORE PROBLEM
THE COMPLIANCE GAP MOST FRANCHISEES DON'T SEE COMING
When your sub's certificate lapses mid-job, their loss becomes your claim. Your general liability policy pays first. The franchisor's indemnification clause activates. The audit happens at year end.
CERTIFICATE LAPSE RISK
A sub's policy renews in March. You hired them in November. Nobody checked. The certificate in your file is technically valid but wrong.
WC AUDIT EXPOSURE
If your sub can't prove WC coverage at audit, the carrier reclassifies their payroll as yours. At roofing rates, that's a significant number.
FDD REQUIREMENT
Most franchise agreements require you to flow down your insurance requirements to subcontractors. Most franchisees never read that clause.
COVERAGE BASICS
WHAT INSURANCE DO HOME SERVICE FRANCHISEES NEED?
Every home service franchise requires a core package of coverage. The specifics depend on your brand and your state. The structure is consistent.
General liability insurance covers bodily injury and property damage that arises from your operations. Most home service franchise agreements require $1,000,000 per occurrence and $2,000,000 policy aggregate as the minimum. Brands in higher-risk trades — restoration, roofing, electrical — often require higher limits or a commercial umbrella policy on top of that base.
Workers' compensation covers your employees for job-related injuries and illness. Almost every state requires it for any employer with one or more employees. The rate you pay depends on your state, your trade classification, and your payroll. Workers' compensation policies are audited at the end of every policy year. Your carrier reviews what your technicians actually did — not just what was listed when you bought the policy. If the classification understated the actual work, you will get a bill for the difference. That audit adjustment can be several thousand dollars you were not expecting.
Commercial auto covers your service vehicles. Personal auto policies exclude business use. Every van, truck, or trailer used for franchise operations needs to be covered under a commercial auto policy. If a technician drives a personal vehicle on a service call, that vehicle needs coverage under a hired and non-owned auto endorsement — which extends your commercial policy to vehicles you do not own.
Completed operations coverage protects you for claims that arise after a job is finished — not just while your crew is on-site. It is the most misunderstood component for home service trades. A pipe repair that fails six months later. An HVAC installation that causes a fire a year out. Damage discovered after a painting crew left the job. These are completed operations claims. The policy must be written on an occurrence form. A claims-made policy ties coverage to whichever policy is in force when the claim is reported — not when the work was done. Switch carriers or let a policy lapse, and completed operations claims from prior work can fall outside your coverage entirely. Occurrence form eliminates that gap.
Your franchise agreement also names the franchisor as an additional insured on your general liability and commercial auto policies. An additional insured is a party added to your policy who gets the protection of that policy for claims arising from your operations. Their exact legal entity name must appear on every certificate of insurance you issue to the franchisor. That means the legal entity from your franchise agreement — not just the brand name. A wrong entity name means the additional insured requirement is not satisfied. Pull the agreement and copy it exactly.
FRANCHISE VS. CONTRACTOR COVERAGE
WHY FRANCHISE INSURANCE IS DIFFERENT FROM STANDARD CONTRACTOR COVERAGE
A contractor without a franchise shops for coverage based on their trade. As a franchisee, you have a second set of requirements layered on top — and those requirements have specific language that standard contractor placements often miss.
Your franchise agreement may require primary and non-contributory language on your general liability policy. Primary and non-contributory means your policy responds first — before any policy the franchisor carries. Your carrier cannot require the franchisor's insurer to share the cost. It may also require a waiver of subrogation — which limits your carrier's ability to pursue recovery from the franchisor after paying a claim on your behalf.
These are not endorsements that automatically appear on every contractor policy. An agent who does not regularly work in franchising may not know to ask for them. A policy can look compliant on the surface — right limits, right parties listed — and still be deficient at the endorsement level. That deficiency only becomes visible when a claim forces the carrier to read the actual policy.
Standard contractor coverage also does not address the trade-specific risks home service franchises carry. Painting franchisees have lead paint and solvent exposure. Restoration franchisees have mold and asbestos disturbance exposure. HVAC franchisees have refrigerant release exposure. Cleaning franchisees have employee theft exposure inside client homes. These risks require either trade-specific endorsements or separate policies. They do not appear in a standard general liability policy unless someone specifically added them.
COVERAGE COSTS
HOW HOME SERVICE FRANCHISE INSURANCE IS PRICED
Quoting a number here would be more misleading than helpful. Two franchisees in the same brand can carry very different premiums. State, payroll, claim history, vehicle count, and subcontractor management all affect what you pay. What is useful is understanding how the major lines are calculated — so you can estimate your own exposure accurately.
Workers' compensation is the most variable line in home services. The formula is straightforward. Take your annual payroll, divide by 100, then multiply by your trade classification rate. That number is then adjusted by your experience modifier.
The classification rate is set by the National Council on Compensation Insurance — called NCCI — and varies by state and by the specific work your technicians perform. Interior plumbing carries a different classification and rate than excavation or sewer work. HVAC installation carries a different rate than janitorial cleaning. Roofing and tree care carry some of the highest classification rates in the country. The work your technicians actually do determines the classification — which is why end-of-year audits exist and why reclassification at audit can produce unexpected bills.
The experience modifier adjusts your rate based on your actual claim history relative to other businesses in your class. A clean three-year history drives the modifier below 1.0 and lowers your premium. Significant claims push it above 1.0 and raise it. Most new franchisees start at 1.0.
One factor that catches franchisees off guard: subcontractor payroll pickup. At audit, your carrier asks for proof of insurance for every subcontractor you used during the policy year. For any sub who cannot produce a current certificate, the carrier adds their estimated payroll to yours. Workers' compensation premium is then charged on that combined total. You pay premium on payroll you never ran. Maintaining current certificates before each job prevents this entirely.
General liability is typically rated on revenue, payroll, or job count depending on the carrier and trade. Commercial auto is rated per vehicle, adjusted for driver history and vehicle type. Both lines vary enough by state, trade, and claim profile that a general estimate here would not be accurate for your operation.
FDD Item 7 includes insurance estimates as part of the initial investment table. Those figures are consistently below what franchisees actually pay once the operation is at full revenue. Build your budget from a quote specific to your trade, state, and payroll — not from the FDD estimate.
COMMON QUESTIONS
FREQUENTLY ASKED QUESTIONS
Wade Millward, CIC
Founder & CEO · Rikor Insurance
Wade Millward has spent 18 years specializing in franchise insurance. He holds the Certified Insurance Counselor (CIC) designation and has reviewed hundreds of franchise disclosure documents across home service, food service, and commercial franchise verticals. Rikor Insurance works exclusively with franchise brands and their franchisees.