MR. APPLIANCE

The Mr. Appliance franchise disclosure document requires general liability at $1,000,000 per occurrence (including products and completed operations and personal and advertising injury) and $2,000,000 aggregate, commercial auto at a combined single limit up to $2,000,000 but no less than $1,000,000, workers' compensation regardless of state requirement, and cyber liability at $500,000 per claim and in the aggregate.

The named insured on your certificate is your own legal business entity. Mr. Appliance SPV LLC is the franchisor. It must be named as an additional insured, with a waiver of subrogation, on all required liability policies, and your coverage must apply as primary and non-contributory — meaning your policy responds first, before any coverage the franchisor carries. Combined single limit means one auto limit applies to any mix of bodily injury and property damage in a single accident. All policies must be written by a carrier rated A.M. Best A-VIII or better.

That is what the agreement establishes. Here is what an appliance repair and installation operation actually faces — starting with the job that fails after the tech is gone.

The franchisor entity is Mr. Appliance SPV LLC, a Delaware limited liability company organized November 13, 2020, with its principal place of business at 1010 North University Parks Drive, Waco, Texas 76707. It is a wholly-owned subsidiary of Neighborly Assetco LLC — part of the Neighborly family of home-service brands. The 2025 franchise disclosure document, Item 8, sets out the following required coverages.

General Liability at $1,000,000 per occurrence and $2,000,000 aggregate, including products and completed operations and personal and advertising injury. Products and completed operations is the part of general liability that covers harm caused by your finished work after you have left the job — the single most important coverage for an appliance business.

Commercial Auto Liability at a combined single limit in the amount the franchisor specifies, up to $2,000,000 but no less than $1,000,000, on each owned, non-owned, or hired vehicle used in the business.

Workers Compensation regardless of whether your state requires it, with minimum coverage as required by state law where applicable. Workers' compensation pays an injured tech's medical bills and lost wages. Its sister coverage, Employers Liability, responds when an injured worker sues the employer claiming the employer's negligence contributed to the injury.

Cyber Liability at $500,000 per claim and in the aggregate, for financial losses from unauthorized access, data loss or corruption, privacy and data-security breaches, misdirected funds, virus transmission, denial of service, and loss of income from network-security failures. This is a required coverage in the Mr. Appliance FDD — and a higher mandatory cyber limit than most home-service agreements set.

All required liability policies must name Mr. Appliance SPV LLC, and any and all parents, subsidiaries, and affiliates the franchisor designates, as additional insureds with a waiver of subrogation. Coverage must be primary and non-contributory. The franchisor may designate a single source for some coverage and may modify the required limits by written notice. Higher limits apply to Key Account work that demands them.

This is the defining claim of appliance work. A tech repairs a range, a dryer, a dishwasher, or an oven. The appliance works when he leaves. Days or weeks later, a fault in the repaired component — a wiring connection, a heating element, a control board — starts a fire. The damage is no longer a single appliance. It is a kitchen, a laundry room, or in the worst case a whole house, plus the bodily-injury exposure if anyone was home.

The coverage that answers this is products and completed operations — the part of general liability that responds to harm caused by your finished work after the job is done. The Mr. Appliance FDD requires it, which is exactly right for this trade. But two details decide whether it actually pays. First, completed-operations coverage must be in force when the damage occurs, and it must extend past the date the job closed. Second, there is a line between covered resulting damage and excluded work. The fire damage to the kitchen and the home is covered resulting damage. The cost to replace the appliance you repaired can fall under the "your work" exclusion, which removes coverage for the specific item you worked on.

For an appliance business, completed operations is not a peripheral coverage. It is the coverage. Confirm it is included, confirm it extends beyond the job-completion date, and confirm the limit is sized to a structure fire, not just a damaged appliance.

Mr. Appliance techs connect water lines constantly — refrigerator ice makers, dishwashers, washing machines. A hookup that is not perfectly sealed does not fail loudly. It weeps. A few drops an hour behind a refrigerator, under a dishwasher, or inside a wall cavity, and within days the water has reached the cabinet base, the subfloor, and the finished space below. By the time anyone notices, a clean repair has produced a five-figure water-damage claim.

Accidental water damage to the customer's other property — the cabinets, the flooring, the ceiling on the level below — is generally the kind of sudden, accidental loss general liability is built to cover, and it falls under completed operations when it traces back to the hookup your tech made. The gaps appear in two places. The connection itself — the part your tech installed — can fall under the "your work" exclusion. And if the moisture sits long enough for mold to grow before the customer catches it, the standard mold and fungus exclusion can block the mold-remediation portion of the claim, which is frequently the most expensive line.

Because slow leaks are the signature appliance loss, two things matter. Confirm your completed-operations coverage responds to water damage that surfaces after the job closes. And ask whether your policy carries a mold exclusion, and whether a limited mold endorsement is available to cover the mold that a slow, undetected leak can produce.

A tech is repairing a high-end built-in refrigerator or a commercial-grade range. A slip with a tool, a dropped panel, a wrong part installed — and the appliance itself is damaged. For an appliance business, the item being worked on is frequently the most valuable single object in the room, and damaging it is a real and frequent loss.

This is where two standard general liability exclusions converge. The "your work" exclusion removes coverage for damage to the work you performed — the repair itself. The care, custody, and control exclusion removes coverage for property in your control or that you were working on when it was damaged. An appliance in the middle of a repair is squarely in your tech's care and is the object of the work. A standard general liability policy excludes damage to it.

The coverage to ask for by name is a care, custody, and control endorsement, sometimes written as a bailee form, which can restore coverage for damage to property in your care during the job. It is not automatic. For a brand whose techs put hands on $3,000 refrigerators and $8,000 ranges every day, the limit on that endorsement should reflect the value of the appliances you actually service.

A Mr. Appliance tech is usually alone in the home for the length of a repair — in the kitchen, the laundry room, sometimes moving through other spaces to reach a shut-off or an outlet. The visit is shorter than a recurring in-home service, but the unsupervised access is real, and so is the day a customer reports a missing item after the tech leaves.

General liability does not cover employee theft. Theft by your own tech is dishonesty, not an accident, and the standard policy excludes it. The Mr. Appliance FDD does not require a bond or a crime policy, so this protection is yours to add. The right product is a third-party commercial crime policy with a theft-of-customer-property endorsement — third-party meaning it covers theft of the customer's property, not just your own. A crime policy generally pays without requiring a criminal conviction, and it does not seek to recover the money from you afterward. That is the key difference from a fidelity bond, which often pays only after a conviction and then bills your business back.

Rikor's benchmark for a trade where techs enter homes alone is a third-party crime policy at $250,000. If you carry one, ask for it on a Loss Discovered form, which covers a theft found during the policy period even if it began earlier — useful when a customer notices a missing item days after the visit, or when you have switched carriers. Keep this separate from any license or permit bond your state requires to hold a contractor or trade license; those are unrelated to theft coverage.

Most home-service franchise agreements treat cyber liability as optional or recommended. Mr. Appliance requires it — at $500,000 per claim and in the aggregate. New franchisees are often surprised by this line, because it is not the coverage they expected to be mandatory for an appliance-repair business. But it follows the way the brand actually operates.

Mr. Appliance runs on a connected system: online and phone scheduling, a customer database with home addresses and contact details, digital service records, and electronic payment processing. Cyber liability covers the financial fallout when that system is breached — notifying affected customers, restoring data, responding to ransomware, and covering losses from fraud-induced fund transfers. The FDD's covered list specifically names misdirected funds and loss of income from network-security failures, which points at the two most common small-business cyber losses: a hacker tricking the business into wiring money, and a system going down.

This is a required coverage, so it belongs in your compliance stack from day one — not the gap section. The practical point is to confirm the policy you buy actually carries $500,000 per claim and in the aggregate, and to confirm it includes social-engineering and funds-transfer-fraud coverage, since those are the claims an appliance business is most likely to face.

Your premium depends on your state, your payroll, your revenue, and your claims history. What you can control is understanding how the number is built — and preparing for the part that arrives after the year ends.

General liability and workers compensation are both auditable. An audit is the carrier's year-end review that compares what you estimated when the policy started against what actually happened, then adjusts the premium up or down. It can move either direction — overestimate, and you get money back.

General liability for an appliance contractor is usually rated on gross receipts — a rate per $1,000 of revenue — with payments to 1099 installers who cannot show a certificate added to the base. Workers' compensation is rated on payroll: payroll divided by 100, multiplied by your state bureau's rate for the appliance-service class code, multiplied by your experience modification — a factor based on your claims history. The per-$100 rate is set by your state's rating bureau, the National Council on Compensation Insurance (NCCI) in most states. The carrier applies it; it does not set it. Because appliance repair is a lower-hazard trade than, say, roofing, both the general liability and workers' compensation rates tend to sit at the lower end of the contractor range.

A worked example on the payroll side. Say you estimate $150,000 in technician payroll when the policy starts. You hire two more techs mid-year and run $260,000 — a $110,000 difference. At an appliance-service workers' compensation rate near $3.50 per $100 of payroll, the audit adds about $3,850, billed as a lump sum after the year closes.

Mr. Appliance's FDD covers the core well — required completed operations and a required $500,000 cyber policy are both meaningful. The gaps lie in the base-policy exclusions the FDD does not address and the coverages it leaves silent. The recommendations below are Rikor's baselines, calibrated for a newer franchisee and scaled by revenue, payroll, and installation mix. A two-tech repair-only operation and a six-tech operation doing heavy installation work sit at different points on every line.

Completed-operations extension — confirm it reaches past the job date. Completed operations is the coverage for an appliance business. The FDD requires it; the work is to confirm it stays in force continuously and extends well past the completion date, so a failure that surfaces weeks or months later is covered under the policy in force when it appears. A gap in completed-operations coverage is the single most damaging gap this trade can have.

Care, custody, and control endorsement. The FDD does not address the CCC exclusion. Your techs handle high-value appliances directly. Add a CCC endorsement so the policy can respond to damage to the appliance being serviced, with the limit set to the value of the most expensive units you work on.

Mold endorsement for slow leaks. Water-line hookups produce slow, hidden leaks, and the standard mold and fungus exclusion can block the most expensive part of a delayed water-damage claim. Confirm whether a limited mold endorsement is available and add it.

Third-party crime at $250,000, Loss Discovered form. The FDD is silent on crime. Your techs are alone in homes. General liability excludes employee theft. Carry a third-party commercial crime policy at $250,000 with a theft-of-customer-property endorsement, on a Loss Discovered form, so a loss found after the visit or after a carrier switch is still covered.

Employers Liability at $1,000,000. The FDD requires workers' compensation but does not state separate employers-liability limits. Employers Liability responds when an injured tech sues the employer for negligence. Rikor's benchmark is $1,000,000 each accident, each employee, and policy limit — confirm your policy carries it.

Contractors Errors & Omissions, exposure-gated. For installation-heavy work or commercial appliance accounts, Contractors E&O at $1,000,000 per claim and aggregate covers faulty workmanship that GL's "your work" exclusion leaves out and judgment errors that cause financial loss. A pure residential repair operation may not need it yet; review it as installation and commercial work grow.

Inland marine for diagnostic tools and parts inventory. Your auto policy covers the van, not the diagnostic equipment, specialty tools, and parts inventory inside it. Inland marine — an equipment floater — covers that property in transit, at job sites, and in the vehicle, on an actual cash value basis. Size it to what your techs actually carry.

Cyber — verify the required $500,000 includes social engineering. The FDD already requires $500,000 of cyber, so it is in your stack. Confirm the policy includes social-engineering and funds-transfer-fraud coverage, since fraud-induced wire transfers are the most common small-business cyber loss and the FDD's own covered list names misdirected funds.

Umbrella — reason from your worst realistic loss. The FDD does not require an umbrella, but lets you use one to satisfy the required limits. Whether you need a true excess layer is a severity question. A repaired appliance that starts a structure fire, or a serious in-home injury, can exceed a $1,000,000 general liability limit — that is the realistic worst case for this trade. The umbrella becomes more important as you take commercial or Key Account work that requires higher certificates, or as installation volume and job size grow. Reason from your real exposure: when a single appliance fire or injury could blow through your primary limit, an umbrella is the layer that keeps that one loss from reaching the business you built.