What Cover Do I Need For A Beauty Salon?

If you are considering joining one of the current 14,000+ Beauty Therapists across the UK by opening your own salon, one of the critical areas you need to consider (if not the most exciting!) is Beauty Salon Insurance.

As with most insurance policies, the devil is in the small print, particularly in an evolving industry where new treatments are coming online all the time.  Let’s examine some of the critical areas of risk in more detail; this should give you a clearer picture of the key areas of cover required.

Buildings / Property

If you have purchased a freehold property, then you will need to insure the bricks and mortar itself via a buildings insurance policy, which can cover risks such as fire, flood, storm, theft, and subsidence.

However, in the majority of cases, you will be renting your premises, generally on a lease agreement, whereby the Landlord will be responsible for insuring the building itself (all be it, your lease may make you liable for this cost).

If you are leasing or renting your salon, you are likely to be making structural or physical improvements to the property such as the installation of sinks, fitted cabinets and decoration.  You should look to cover this area under the tenants’ improvements section of your Beauty Therapist Insurance policy.

Contents

General contents such as chairs, therapy beds, business and computer equipment can also be covered, generally for “All Risks”.  The critical point is to ensure that the sums insured are adequate, particularly as you add further new equipment as the business develops.

Most Insurers will also impose a “minimum security condition” within their wording, which stipulates the required locks and security provisions required for theft cover to apply. When you are considering a policy purchase, you should review the policy terms and any conditions carefully to ensure you meet their specific requirements – or better still, take the advice of a specialist advisor.

Public Liability

As you will have clients and members of the public visiting your premises, Public Liability Insurance is a critical area of protection. Providing cover for your legal liabilities should a client or member of the public suffer injury or damage to property as a direct result of the actions of you or a member of your team – For example, a client trips over a loose doormat and breaks their ankle.

TOP TIP – One area often missed is the extension of your duty of care to areas such as car parks or toilet facilities.  If you do provide parking, make sure that regular risk assessments are made, particularly in snow or icy conditions.

Employers Liability

If you are employing any staff (even part-time workers or apprentices), you are legally required to purchase Employers Liability Insurance under the Employers Liability (Compulsory Insurance) Act 1969.  The cover provides protection for your legal liabilities should an employee suffer injury or illness as a direct result of their employment with you.

For example, your assistant is plugging in a lamp and suffers an electric shock or falls from a step-ladder while putting up the Christmas decorations.

Products Liability

Injury or illness caused to a client or third party as a direct result of products provided by you (for example, shampoos or skin products) can be covered under product liability cover.  Typically, this will automatically be provided alongside Public Liability Insurance.

Professional Liability / Treatment Risk

At the core of any beauty salon insurance is the requirement to cover claims made against your professional liability or treatment risk.  Should a client suffer an injury following treatment you (or one of your employees) have administered, they may hold you responsible and look for compensation.  Professional Liability or treatment risk provides insurance protection against such instances.

The level of treatment risk provided can differ from Insurer-to-insurer, as will the risk exposure and premium levels.  Simple nail treatments have incidental exposures, while salons that offer full-body treatments will have higher exposure. Permanents and hair-straightening chemicals plus colouring can cause considerable hair and skin damage. Full-body mud treatments, pedicures, and manicures may also increase professional liability.

TOP TIP – Make a list of all of your proposed treatments and run through this line-by-line with your insurer to make sure that all areas are fully covered.

Money

Chances are you will still be accepting cash payments from clients.  Theft of money losses can be covered at your premises, while held at your home address, or while in transit to your bank.

Glass

If you are operating from a High Street address, you may be responsible for a glass frontage, which can be expensive to replace – for example, if a brick was thrown through your window.  Many beauty salon policies will provide glass cover as standard, but make sure the level of protection is adequate for your specific needs.

Beauty Salon Business Interruption

Probably the furthest thing from your mind when you are just setting up your beauty parlour is provision for the continuation of your business should a severe loss occur, such as a fire.  However, this is a crucial area of insurance which also needs ongoing review.

Business Interruption provides cover for loss of profits and fixed costs following an insured event.  Imagine that your salon suffers a severe fire and cannot trade – you will still be responsible for expenses such as your lease as well as lost revenue while the business recovers from the loss.

Other Areas Of Cover

While a Beauty Insurance package policy will provide the majority of your key requirements, there are other considerations, such as:

• Legal Expenses – Cover for legal costs relating to business legal disputes
• Personal Accident – Weekly and Capital benefit payments if you are injured and cannot work
• Motor Cover – Car or Van Insurance for vehicles used for business purposes
• Employment Practices Cover – Cover for employment-related issues such as unfair dismissal or harassment claims.