Beauty professionals are exactly the same as all other businesses in the sense that they need insurance to protect their businesses against unexpected losses. You can minimise the chance of these unexpected losses occurring, but you can’t completely eliminate all of the risks.
Many of the risks that beauty professionals face can be covered by a standard business insurance package policy. However, because the beauty profession is unique, there are certain risks that are not covered by standard business insurance. This is why it’s important that beauty professionals make sure that they have a beauty insurance policy that has been tailored to the beauty profession to make sure that they are not uninsured in the event of a claim.
What does business insurance cover?
The two core components of a standard business insurance package policy are property insurance and liability insurance.
Property insurance, as its name suggests, covers your business property. This includes your premises and its fixtures and fittings as well as your office equipment, other equipment and stock. It covers accidental damage to your property as well as loss of your property due to theft.
Liability insurance covers you if a compensation claim is made against you. As well as covering any damages awarded against you, it also covers the legal costs incurred in the handling of such compensation claims and other miscellaneous expenses. There are three types of liability insurance.
Employer’s liability insurance covers compensation claims made against you by your employees. This type of insurance is a legal requirement if you have any employees.
Public liability insurance is similar but covers compensation claims made against you by members of the public rather than employees. Public liability insurance usually includes a third type of liability insurance, products liability insurance, which covers compensation claims arising as a result of a defect in a product that you have sold or supplied.
There are also optional extra covers that can be added for a small additional premium. These include legal expenses insurance that covers unexpected legal bills if you become involved in legal action, and personal accident and sickness insurance that protects your income by paying a weekly benefit if you’re unable to work due to an injury or an illness, or a lump sum if you’re permanently incapacitated.
How is insurance for beauty professionals different?
Although many of the risks that beauty professionals face are covered by a standard business insurance package policy, there are some risks that are not insured. For this reason, insurance policies that have been specifically designed for beauty professionals include an extra type of insurance called treatment risk insurance.
Treatment risk is needed because standard business insurance doesn’t cover claims arising out of professional activities. Standard public liability insurance will cover you if someone trips over in your beauty salon, but it will not cover you if someone is injured as a result of a beauty treatment that you have provided.
This is a major issue because compensation claims that arise as the result of a beauty treatment gone wrong can be expensive to settle. And no matter how experienced you, how many qualifications you have and how careful you are, accidents do still happen.
A claim for facial scarring, for instance, could result in damages of £60,000 being awarded. In addition, you might have to pay the cost of private cosmetic surgery and once the legal fees to settle the claim and the injured person’s lost wages have been taken into account, the end result could be a six-figure amount.
Treatment risk is included in insurance policies that have been tailored to the beauty profession. It covers the damages awarded if a compensation claim is made against you for a beauty treatment you have provided, as well as covering the associated legal costs and other expenses.