Lack of good information has led to plenty of misconceptions about franchise business insurance. We wanted to take the opportunity to set the record straight about the 5 most common insurance misconceptions out there.

1. All insurance is basically the same.

It’s a common insurance misconception that all insurance is basically the same. The thought is that “most types of insurance policies work the same way” or that “all policies of a particular kind offer the same basic coverage.”

The truth is that insurance can be as individual as you and your business are. Differences between categories of insurance can be huge. Consider how property insurance pays claims directly to you, the insured, while liability insurance pays claims to a third party on your behalf.

Differences between specific policies and insurance carriers also exist. Because insurance works as a tool to protect your business from the specific risks you face, your coverage options may vary based on your industry and your choice of carrier.

2. Some things just can’t be insured.

Another common misconception is that insurance offers limited options for protection. The idea is that insurers offer a narrow range of coverages for the “big” risks that people and businesses face with little or no coverage for anything else.

The truth is that you can insure almost anything. In any case where a risk exists, an insurer can work with you to protect you and your business against that exposure and the potential loss it could cause to your business.

Over the years, insurers have adapted to changing markets and risk profiles, seeking out creative solutions to overcome emerging risks. This continues to the present day, with insurers focused on helping businesses become safer, smarter and more profitable.

3. Insurers aren’t knowledgeable about my industry.

There’s a popular misconception in the business world that insurers are not knowledgeable about their customer’s industry. There’s an assumption that insurance guys “probably know enough” about the insurance products they sell and service, but not much about your specific industry.

This is not the case when you work with an insurer like Lockton Affinity. Lockton Affinity brings decades of experience to bear on the products we sell, the customers we work with and the industries we insure. We take special care making sure we understand your needs so we can serve you better.

Since 1987, we have been providing insurance solutions to franchise businesses like yours. Having provided custom-tailored, implemented and managed insurance solutions for more than 90 franchise brands, you can be assured we will provide the right policies to benefit you.

4. Representatives only handle claims and renewals.

Another common misconception about insurance is that your insurance representative only wants to hear from you when you have a claim or it’s time to renew your policy. Often, there’s an unspoken fear among policyholders that their questions will be bothersome to their insurer or even worse, result in an unexpected rate hike.

The truth is that your relationship with your insurer is not one-sided. It’s a partnership with an important goal—to ensure you’re protected against key exposures and to help you determine how much risk you can tolerate.

At Lockton Affinity, we take our relationships with policyholders to heart. We live service and seek to define ourselves by our service every day. We pride ourselves at being experts in your industry so that we can assist you in answering all your questions and getting the coverage you need to be protected.

5. Most insurance isn’t necessary.

One final misconception that is very common is the belief that most insurance isn’t necessary. The idea here is that a lot of coverage is “nice to have,” but probably unnecessary and not worth the cost outlay in the end.

The truth is that you don’t need to have experienced a claim for your insurance to do its job. While many people correctly look at insurance as a way to purchase peace of mind or hedge against future uncertainty, another perspective is that your insurance coverage helps transfer excessive risk so that you can focus more on your business.

Lawsuits in your industry are common, whether for a workers’ compensation claim, wrongful termination claim, employee fender-bender, or something else. On a long enough timeline, you’ll eventually face a claim. Your franchise insurance helps mitigate those risks so you can focus on what’s most important: your business.


It’s easy to get the wrong idea about insurance, especially with these common insurance misconceptions. Without the right information, you may be unaware of all your Lockton Affinity franchise insurance options and the insurance experts that are ready to help you get the coverage you need.

Lockton Affinity Insurance is comprehensive and affordable, and tailored to the specific needs of your industry. Our program simplifies the insurance buying process and removes all the unnecessary coverage you don’t need to give you only the insurance you truly need to fully protect your franchise.

Curious what coverage prices will look like for your business? Complete our quick, five minute price indication request to receive a personalized indication that allows you to make a financially informed decision about your insurance.