What is the range of estimated costs for insurance that an Annex Brands franchisee should expect?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
. The estimated annual premium for the above coverage is about $1,500 to $5,000. The annual premium for workers' compensation insurance is based on employee payroll. Rates may vary from state to state. Most state insurance carriers offer this coverage subject to an annual minimum premium of about $1,000. In addition to carrying other insurance described in the franchise agreement, you must participate in any Annex Brands group-wide or other designated insurance program that is available to franchisees regarding small parcel, freight, or transit damage and related risks. Premiums generally are from $.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, is billed to the customer at the time of shipment, and is 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, shipping and packaging 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. If you are flex retail location, as applicable based on services provided, you also must have a "Bailee's" coverage insurance policy that is in addition to small parcel, freight, or transit damage insurance. The "Bailee's" policy must include coverage of personal property of others in an insured's care, custody and control that is temporarily at an insured's center with a minimum limit of $400,000, coverage of personal property of others in an insured's care, custody and control at another location with a minimum limit of $400,000, and coverage that includes the transportation of personal property of others while in an insured's auto or truck with a minimum limit of $400,000. If you choose to provide expanded services of household moving and other relocation products and services, you also must have employment practices insurance (including sexual harassment, wrongful termination and discrimination coverage) in the amount of at least $500,000 for each incident and $1,000,000 in the aggregate, and an umbrella policy (covering general liability, auto, and employer's liability) with a limit of at least $2,000,000.
Note 12: See Item 5 for details about the conversion training fee, and also see Item 11.
Note 13: See Items 5, 6 and 11 for details.
Note 14: You will need office supplies such as telephones, answering machines, shipping labels, brand labels, telephone connections, in-center marketing collateral, business cards, letterhead, Notary equipment, etc.
Note 15: Deposits may vary from location to location. Some utility deposits may be refundable after a designated period.
Source: Item 7 — Estimated Initial Investment (FDD pages 32–39)
What This Means (2025 FDD)
According to Annex Brands' 2025 Franchise Disclosure Document, franchisees should anticipate annual insurance premiums ranging from approximately $1,500 to $5,000. This estimate covers comprehensive general liability, motor vehicle liability, Notary professional liability, and property insurance. The annual premium for workers' compensation insurance is based on employee payroll, with many state insurance carriers offering coverage subject to an annual minimum premium of about $1,000. These rates may vary from state to state.
Annex Brands franchisees are also required to participate in any Annex Brands group-wide or designated insurance program regarding small parcel, freight, or transit damage and related risks. Premiums for this coverage generally range from $0.55 to $1.75 per $100 of property valuation, packaging, and shipping charges. This expense is typically passed on to the customer, often with a markup. However, Annex Brands retains the discretion to increase the rate to $0.72 to $2.28 per $100 of property valuation, shipping, and packaging charges if a franchisee has a high number of claims due to improper packaging and shipping standards, provided they give at least 15 days' notice.
In addition to the standard insurance requirements, flex retail locations must have a "Bailee's" coverage insurance policy with minimum limits of $400,000 for personal property of others in the insured's care, custody, and control, both at the center and at another location, as well as during transportation in the insured's vehicle. Franchisees who provide expanded services such as household moving and other relocation products and services must also maintain employment practices insurance with a minimum of $500,000 per incident and $1,000,000 in the aggregate, along with an umbrella policy with a limit of at least $2,000,000. All insurance policies must be issued by responsible insurance companies with a Best's rating of not less than A, and Annex Brands and its affiliates must be added as additional insureds, except for workers' compensation, employer's liability, and employment practices insurance policies. Premiums and insurance programs are subject to change with at least 15 days' notice.