It’s common for people to wonder how much barber shop insurance will cost, particularly if they’re thinking about starting their own business and haven’t owned a barber shop insurance before.
However, it’s also a question that is next to impossible to answer because no two barber shops are the same. If you’re running a small barber shop in a rented unit in a provincial town, you’ll be paying a lot less than you will if you’re running a barber shop in a building that you own in London’s West End and you’re specialising in the doing haircuts for the rich and famous.
The only sure way to find out how much insurance is going to cost you is to speak to an insurance broker to get a quote. Most insurance brokers won’t charge you a fee to prepare a quote for you and you won’t be obliged to accept the quote that they provide.
However, there are certain factors that affect the cost of insurance and knowing what those factors are can help you manage your insurance costs better.
The main drivers of barber shop insurance cost
There are certain factors that will affect your insurance cost whether you’re a barber, an auto-electrician or someone who specialises in putting on firework displays. Essentially, these factors are the things that determine how likely you are to make an insurance claim, and how large any insurance claim you might make could be.
These factors can be broken down into the following:
- Your qualifications, experience and history
- How much you need to insure
- What you need to insure
Your qualifications, experience & history
It goes without saying that someone who is fully qualified and has been working in the profession for 20 years without an incident will be looked on more favourably by an insurance company than someone who hasn’t got any qualifications, has simply bought a pair of scissors on eBay and decided to have a go.
But that doesn’t mean that if you don’t have any experience, the cost of setting up will be prohibitive. If you’ve done a proper training course, that shows the insurance company that you know what you’re doing and that the chances of something going wrong are lower. And that doesn’t just mean a training course related to hairdressing. Taking a business course can also help because it shows the insurance company that you know how to run your barber shop professionally.
It also doesn’t mean that if you don’t have thousands of qualifications you’ll be insurable. If you’ve been working for someone else for a number of years without an incident and have decided to go it alone, that experience will help you get better terms from the insurance market.
How much you need to insure
If you’re operating from a million pound building with state of the art equipment that you’ve purchased on a no-expense-spared basis, your insurance will cost you more than it will if you’re operating from a rented unit with fairly basic equipment. This is because if your barber shop burns down or is burgled, the insurance claim will be more expensive to settle if you have more stuff.
That’s not to say that trading from an expensive building is a bad idea. Sometimes, if you’ve got impressive premises you’ll attract more clients and that’ll more than offset the additional insurance cost. But it’s something to bear in mind.
Similarly, liability insurance is usually based on your annual turnover. Obviously, if you’re doing twice as many haircuts, there’s twice as much chance of one going wrong and a compensation claim being made against you. Again, that extra turnover will more than pay for the additional insurance cost, but it’s something to bear in mind.
What you need to insure
If you are operating in a “rough” area, your insurance cost will be higher because there is a great risk that your premises will be burgled or vandalised. You can address this by improving the security at the premises and doing so will often result in a discounted insurance premium.
But the other side of this is that if you are operating in a relatively upmarket area, you might need to consider a higher public and products liability indemnity limit. If that’s the case, your insurance cost will be slightly higher.