WHEN YOU WORK WITH RIKOR, YOU GET
Protection at the system level, not just the unit.
The coverages that protect the brand itself, when a franchisee, a customer, or a decision puts it on the hook.
01
Franchisor errors and omissions
When a franchisee sues the brand, claiming your guidance or system caused them a loss.
02
Franchisor directors and officers
When a decision your leadership made is challenged, and your officers are named.
03
Franchisor vicarious liability
When a franchisee's customer sues, and names the brand for how the unit was run.
04
Cyber liability
When a breach hits the brand's systems or data.
05
Crime insurance
When employee theft, fraud, or missing funds hit the brand.
COVERAGE 01 · WHEN A FRANCHISEE SUES YOU
Franchisor errors and omissions.
A franchisee can sue the brand, claiming your guidance, training, or system caused them a financial loss. Errors and omissions answers the claim, and pays to defend it.
"You said it would work."
A franchisee follows the brand's playbook, the unit underperforms, and they sue the franchisor, claiming the guidance and the projections cost them money. Errors and omissions responds to the claim against the brand, and the cost to defend it.
"The support never came."
A franchisee claims the brand failed to deliver the training or support it promised, and sues for the shortfall. This is a professional-services claim against the franchisor, and it is exactly what errors and omissions is built for.
COVERAGE 02 · WHEN A DECISION IS CHALLENGED
Franchisor directors and officers.
A franchisee, investor, or partner can challenge a decision your leadership made, and name your officers and directors personally. Directors and officers defends the people who run the brand.
"The board made the wrong call."
A group of franchisees challenges a decision the leadership made: a fee change, a territory shift, a disclosure. The suit targets the officers and directors personally. Directors and officers defends them and the brand.
"It cost us money."
An investor or partner claims a leadership decision damaged the business and sues the board. Directors and officers responds to claims about how the brand is governed, so a single decision does not fall on the people who made it.
COVERAGE 03 · WHEN A FRANCHISEE'S CUSTOMER SUES
Franchisor vicarious liability.
A franchisee's customer gets hurt, sues the franchisee, and names the brand too, because of how the unit was run. Vicarious liability is what pulls the brand into a claim it had no hand in.
"They named the franchisor too."
A franchisee gets sued by a customer. The plaintiff names the franchisee, then names the brand, arguing the franchisor controlled how the business was run. The brand gets pulled into the case, and can end up paying.
"A customer chipped a tooth."
At one of a hundred locations, a customer chipped a tooth on a salad and sued the franchisee. They named the franchisor too, by vicarious liability, for how the unit operated. The franchisor defended and settled. The cost reached about a million dollars, with no coverage behind it.
"One name on every door."
Customers see one brand, not separate owners. That shared name is what lets a plaintiff argue the franchisor shared in the control, which is enough to pull the brand into a franchisee's lawsuit.
"The unit was underinsured."
When the franchisee being sued does not carry the right limits, the cost and the defense can land on the franchisor. A single underinsured unit becomes the whole brand's problem.
QUESTIONS FRANCHISORS ASK
Before you book the call.
PROTECT THE BRAND BEFORE THE CLAIM
Stop paying for a franchisee's lawsuit out of pocket.
A short review shows you where the brand is exposed to a franchisee's lawsuit, and how to put protection in place before the claim arrives.
When insurance is done right, it may cover the cost of defense and settlement. Coverage depends on your policy, its terms, and the facts of the claim.