If you are considering opening a salon, one area you need to consider is Beauty Salon Business Insurance.
What types of beauty salon business insurance do you need?
As with most insurance policies, the devil is in the small print. This is particularly relevant in an evolving industry where new treatments emerge regularly. 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 for beauty salon Business Insurance
If you have a freehold property, you must take out a building’s insurance policy. This can cover risks such as fire, flood, storm, theft and subsidence.
Often you will be renting your premises, generally on a lease agreement. In this case, the landlord will usually be responsible for insuring the building.
If you rent or lease your space, you may improve the property by installing sinks, lights, cabinets etc.
These additions can be covered under the tenants’ improvements section of your Beauty Business Insurance policy.
Contents insurance for Your Beauty business
General contents such as chairs, therapy beds, and computer equipment can also be covered. You must ensure that sums insured are adequate. If you add equipment as your business grows, you should update your policy. Not keeping your policy up to date can result in underinsurance in the event of a disaster.
Most insurers will also impose a “minimum security condition” within their wording. This states what locks and security provisions you need for theft cover to apply. You should always review the terms and conditions when buying a policy. This is to ensure you meet the insurers’ requirements and not void your policy.
While you may wish to check this yourself, many prefer to speak to an insurance advisor. A professional opinion can give you the peace of mind you need when taking out your policy.
Public Liability insurance for Beauty business
Public Liability provides cover if a member of the public suffers injury or property damage and your business is at fault. For example, a client trips over a loose doormat and breaks their ankle. Public Liability will make up a core part of your beauty business insurance policy. As your business requires you to interact with the public, this cover is highly recommended.
TOP TIP – One area often missed is care for areas such as car parks or toilet facilities. If you provide parking, make sure that regular risk assessments are made, particularly in snow or icy conditions.
Employers Liability insurance for beauty salon business
If you have employees, you must have Employers Liability Insurance under the Employers Liability (Compulsory Insurance) Act 1969. This includes part-time workers or apprentices. EL covers your legal liabilities if an employee suffers injury or illness as a result of their work.
For example, an employee suffers an electric shock or falls from a ladder in your stock room. Following an incident, an employee has the right to seek compensation. It is for this reason that EL cover is a legal requirement.
Products Liability insurance for beauty salon business
Products Liability covers Injury or illness as a direct result of products provided by you. For example, shampoos or skin products that you sell at your counter. Typically, this will automatically be provided alongside Public Liability Insurance.
The cover applies only to products you sell or give away for free, not products used in treatments. Allergic reactions from treatments would come under treatment risk cover.
Professional Liability / Treatment Risk insurance for your beauty business
Should a client suffer an injury following treatment, they may seek compensation. Professional Liability or treatment risk provides insurance protection against such instances.
Premiums and indemnity limits will vary from insurer to insurer. Likewise, the level of cover needed will depend on your business. Invasive treatments will often come with higher premiums. However, even nail treatments come with risks to consider. For example, some customers may be more prone to infections. Cases have been made against salons for compensation following infections and even amputations.
In hair salons, chemicals used in treatments can cause considerable hair and skin damage. While full-body mud treatments, pedicures, and manicures may also increase professional liability.
Even if you are found not to be liable, legal defence can be pricey.
TOP TIP: List all your proposed treatments to your advisor to ensure that all areas are covered.
Money insurance for beauty salons
Chances are, you will still be accepting cash payments from clients. Fortunately, money can be covered at your salon, your home address, or while in transit to your bank. Cover for cash before you deposit it into your bank can bring you peace of mind.
Glass-front Coverage for Beauty Salons
Large panes of glass are expensive to replace. For example, if a brick was thrown through your window, the cost could be thousands. In fact, a small crack can prove sinister in a large pane of glass. This is why many beauty salon business insurance policies will provide glass cover as standard. However, make sure the level of protection is adequate for your specific needs.
Business Interruption Insurance for Beauty Salon Business
When you start your business, a severe loss in the future might not be at the forefront of your mind. Or, you may take out a policy and never update it. However, business interruption is an area of insurance which needs ongoing review.
Business Interruption covers 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 that you likely will not be able to cover without income.
Provided your business has adequate BI cover, these losses can be covered up to your indemnity limit.
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.