Under what conditions can Annex Brands increase the transit insurance rate for a franchisee?
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's 2025 Franchise Disclosure Document, the transit insurance premiums generally range from $0.55 to $1.75 per $100 of property valuation, packaging, and shipping charges. These premiums are typically passed on to the customer with a markup by the franchisee.
Annex Brands may increase the transit insurance rate if a franchisee has a high number of claims due to improper packaging and shipping standards. In such cases, the rate may increase to approximately $0.72 to $2.28 per $100 of property valuation, packaging, and shipping charges.
Annex Brands must provide the franchisee with at least 15 days' notice before increasing the transit insurance rate. The franchisee is required to participate in any group-wide or other insurance program that Annex Brands designates for small parcel, freight, or transit damage and related risks. Payment for these premiums is made weekly with royalty and marketing fee payments via automatic bank draft.