Top Five Franchisee Benefits of a Franchise System Insurance Program
Having a tailored franchise insurance and risk management program can alleviate any stress you may have over your franchise. Different franchises have different stipulations when it comes to individual franchise insurance options. While some require their franchises to use the firm’s existing insurance, others require their franchisees to find their own. However, using a franchise insurance system, which is an insurance system that includes both the franchisee and the franchisor, can greatly enhance a brand’s business.
Here are the top five benefits to franchisees of successful insurance programs:
Owning a franchise can be a lucrative business investment. Once you have researched your franchise through a site like FranchiseExpo.com and have invested money in it, the livelihood of that business is extremely important to your financial well being. As owning and operating a franchise is a challenging, new endeavor, knowing that an insurance program covers your franchise will offer you peace of mind.
Often times, to cut costs, new franchise owners opt for the cheapest insurance. However, that can be extremely costly in the long run, especially if something catastrophic occurs that is not underneath the branch of insurance. Being apart of a franchise system insurance program that is tailored to your particular franchise alleviates any concern that your business is not covered.
In franchising, compliance with FDD insurance requirements is something to be taken seriously. Time and again franchisees did not carry the proper insurance coverage, and unfortunately were out either a significant amount of money or the business entirely after a claim was made against them. This not only affects the franchisee, but also the franchisor (since their brand will be mentioned in the claim) and other franchisees. Finding an insurance program that can protect your franchise as well as the franchisor will protect the integrity of your business.
Inevitably, when it comes to business, there will be a lawsuit or two that come your way. As mentioned in the point above, being apart of a franchise means that your store could hurt financially if another store is going through a lawsuit. If your franchise only has a limited amount of coverage, it’s at risk to main exposures. Finding a franchise insurance system that cares about your needs and will protect your assets is crucial to your business’s longevity.
There is a balance between an overpriced insurance plan and an inexpensive one that covers next to nothing. While it can be difficult to find an insurance program that offers you the protection you need without an astronomical price tag attached to it, do your research. This is one area you do not want to compromise. Additionally, using one agency to cover the brand as a whole is a great way to acquire a low insurance rate for a lot of coverage.
When it comes to your franchise, it’s future is critical to your future. Working with your franchisor to set up an insurance program tailored to the particular brand can offer both your and your company financial security.