Is participation in group-wide insurance programs mandatory for Annex Brands franchisees?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee (1) | Amount | Due Date | Remarks |
|---|---|---|---|
| Transit insurance | Premiums generally are $0.55 to $1.75 per $100 of property valuation, packaging and shipping charges, (typically this expense is passed through to the customer after being marked up by you) | Payable weekly with royalty fee and marketing fee payments | You must participate in any group-wide or other insurance program that we designate regarding small parcel, freight or transit damage and related risks. Premiums typically are billed to the customer at the time of shipment, and are based on the carrier used, whether the shipment is domestic or international, the declared value of the items tendered for shipping, and the packaging and shipping charged to the customer. In our sole discretion, we may increase the rate if you have a high number of claims due to improper packaging and shipping standards (generally, $0.72 to $2.28 per $100 of property valuation, packaging and shipping charges) after at least 15 days' notice to you. Premiums and insurance programs are subject to change after at least 15 days' notice to you. Payable weekly, or as otherwise designated, to us or through us to our designated suppliers. You must pay us by automatic bank draft. (3) |
Source: Item 6 — OTHER FEES (FDD pages 24–32)
What This Means (2025 FDD)
According to Annex Brands' 2025 Franchise Disclosure Document, participation in group-wide insurance programs is mandatory. Specifically, franchisees must participate in any group-wide or other insurance program that Annex Brands designates regarding small parcel, freight, or transit damage and related risks.
The premiums for transit insurance generally range from $0.55 to $1.75 per $100 of property valuation, packaging, and shipping charges. This expense is typically passed through to the customer after being marked up by the franchisee. The premiums are based on factors such as the carrier used, whether the shipment is domestic or international, the declared value of the items, and the packaging and shipping charges to the customer.
Annex Brands retains the discretion to increase the insurance rate if a franchisee has a high number of claims due to improper packaging and shipping standards. In such cases, the premiums could increase to $0.72 to $2.28 per $100 of property valuation, packaging, and shipping charges, but Annex Brands must provide at least 15 days' notice before increasing the rate. Premiums and insurance programs are subject to change with at least 15 days' notice. These premiums are payable weekly with royalty and marketing fees via automatic bank draft.