Insuring the Franchise
Industry: Restaurant Exposure: $7,000,000
Coverage Benefit: Added food contamination, moved from occupational accident to workers compensation, & added off premises power& spoilage.
Savings: 25% 0r $15,000
The owners of a franchise believed that the limit of insurance required by the Grantor of Franchise would be sufficient to protect all of their assets, when, in fact, they were underinsured. In addition, the owners had multiple policies for multiple locations, so they had some overlapping coverage. The current agent had convinced the owners that an occupational accident policy would be a cheaper alternative to workers compensation coverage.
Risk Management Solution
Swingle Collins & Associates met with all the franchise owners for a particular restaurant in the DFW area at their monthly meeting. We described a sample coverage analysis completed for one franchise owner with two locations. The analysis showed that four separate policies could be combined to create one master policy, which lead to premium efficiency across all lines of coverage while eliminating the duplication of coverage. Swingle Collins & Associates also increased the amount of property and general liability coverage to a level adequate to protect each franchisee’s assets and added multiple coverage enhancements directly related to the food industry that were not currently provided on the insured’s old program. Finally, the insured was given the option to replace their current “Non-Subscription” occupational accident policy with a workers compensation policy. The franchisees chose this WC policy, because it doubled their coverage and still cost 25% less than their old policy. Swingle Collins partnered with one of their premier carriers to market all franchises as one account, which allowed each franchise owner to benefit from large company premium savings.
Swingle Collins’ consultative analysis provided superior insurance coverage, filled gaps in coverage and delivered a 25% reduction to the franchise owners insurance costs.