Understanding Business Insurance for Day Spas
Protecting a business from its exposures to loss with insurance is investing in its future. It is no different for day spas or personal care businesses. These businesses include services performed by professionals such as skin care technicians, massage therapists, or other service providers like aestheticians, personal trainers, or weight loss professionals. They may also have swimming pools, steam rooms, or hot tubs to offer their clients a day of self-care and relaxation. In 2019, the market size of the US Beauty and Personal care sector was approximately $81.1 billion, and by 2030 it is projected to be $128.7 billion.
Having put time, effort, and money into their business, a business owner should consider what insurance is needed for their specific establishment. Do they prefer to see claims and losses handled professionally by company adjusters rather than attempting to address these occurrences in-house? Slip and fall accidents in the steam room, property claims, business interruption, thefts, or allergic skin reactions suffered by customers are instances of such risks. Running a business is challenging enough without worrying about unexpected claims. Business owners let insurance companies handle such threats by matching them with appropriate policies.
Business and Professional Risks
Salons allow their customers to achieve their potential in terms of their confidence, beauty, and personal care goals. But in doing so, spas are exposed simply with their premises and operations. When services have to be provided to difficult or demanding customers, the complaints and losses may increase. Some of the risks that salons have to face are as follows:
- Bodily injury (product liability) : A shampoo used by a salon, which is its own product, causes a painful rash on the customer's scalp along with acute hair loss.
- Bodily injury (professional liability) : A customer claims that a salon's massage therapist caused an acute backache affecting their mobility.
- Bodily injury (premises liability): A customer is involved in a slip and fall incident while getting out of the jacuzzi due to its slippery surface.
- Slander charge: An aesthetician at a salon slanders a customer to another customer. The first customer hears through the grapevine and files a claim against the salon and employee.
- Property damage: The storefront window is broken during a storm causing damage to the interior and contents.
- Malware attack: An employee opens a suspicious email that cripples the salon’s computer system.
Buying appropriate business insurance policies is the difference between going out of business from a loss versus recovering from that difficult situation. A grooming or personal care business owner might consider investing in the following policies:
General Liability Insurance
This policy addresses bodily injury and property damage claims for which the business is liable. This policy also protects against libel, slander, and other personal and advertising injury claims. It pays for the claims, defense and damages for lawsuits filed against a business on insured claims.
Massage oil spills over a customer’s expensive clothes. General Liability will address the damage and monetary claims.
Misappropriation of advertising ideas
An employee shares an idea for a salon’s billboard caption. The owner doesn’t know that the employee has stolen the idea from a competitor’s employee. The competitor files a lawsuit. This policy will respond to the lawsuit.
Trip and fall injury
A customer trips on the ripped carpet and falls. General Liability will respond to the customer's claim for reimbursement of medical expenses due to the injury.
Property Insurance with Business Interruption
A spa care business or day spa can sustain property damage due to wildfires, riots, windstorms, tornadoes or other perils. The damage could force a company to halt operations while repairs are done to the building, and business contents are replaced.
Property damage and business interruption: A tornado rips through a neighborhood. A salon suffers significant damage. As a result, it cannot open and conduct normal operations. Its commercial property insurance will pay for the repair of damage to building, furnishings, equipment, and computer systems. The Business Interruption coverage will provide a revenue stream for the salon to pay ongoing expenses until the salon is able to fully reopen.
Customers may sue a salon if the service experience leaves them feeling or looking worse than when they came into the salon. The claim might be around the misuse of chemicals by a salon technician causing a severe reaction, or it could be a wrong nerve or muscle pressed during a massage therapy session where the ensuing pain restricts a client's mobility.
Professional Liability Lawsuit
A model launching out into a new career goes to a salon. She needs hair and makeup styling services for a modeling job she is pursuing. She later claims she didn't get the assignment because the salon's makeup artist didn't do a proper job. She sues the salon for losses in income. The salon's Professional Liability addresses the claim.
When a salon's computer system is attacked and compromised, whether from a privacy breach, ransomware attack or denial of service, multiple expenses will be incurred to respond and recover from these events. Notification and credit monitoring expenses, system restoration, and forensic investigations can be purchased with the appropriate Cyber policy insurance. The policy provides defense for complex lawsuits and payment of awarded judgments for covered claims that could otherewise result in financial hardships for the business owner.
Employee criminal acts can occur in multiple ways; a disgruntled employee steals customers' personal information and sells it on the dark web. An employee embezzles company money, setting up fake vendors to pay and pocketing the payments. Forgery of checks is another way employees can harm their employer's finances. These claims are covered under a Crime policy, including employee dishonesty, computer fraud and forgery coverage.
Overall Insurance Costs
To decide on the right insurance policies to protect a business, one needs to look at factors such as the business's revenue, the number of people it employs, its location, the number of outlets, and its claims history. The cost of the establishment's policies will be determined based on these factors. Visit our site to get a quote for your business.
A safely functioning business is ultimately in the interest of the general public, the business establishment, the owner, its employees, and the customers who visit its premises to make purchases. Therefore, good business insurance benefits the stakeholders of the business.