Like all businesses, hair, beauty and nail salons need insurance. No matter how careful a business is and no matter how qualified its staff are, unexpected losses will occur. When that happens, businesses – including hair, beauty and nail salons – need insurance to protect them.
In many ways, salon insurance is the same as the insurance many other businesses have. It covers accidental damage to the business property or loss of the business property due to theft. It covers compensation claims that are made against the business. And there are a number of optional covers that many other businesses choose to give them additional protection.
However, salon insurance has a few extra covers that aren’t included in a standard business insurance package.
Stock and equipment insurance protects a business in the event of accidental damage to its business property, or loss of that property in the event of a theft.
The property that can be covered includes:
- Business premises
- Fixtures and fittings
- Other contents, stock and equipment
- Computer equipment
- Glass, including sign written glass
Liability insurance covers businesses if a compensation claim is made against them become someone believes the business is responsible for them suffering a loss.
This type of insurance is important because some liability claims can cost over £250,000. It’s also important because liability claims can involve complex legal issues, and having an insurer to help you handle a compensation claim can have a major impact on that claim’s outcome.
As well as covering any compensation award made against you, liability insurance also covers the legal fees incurred in handling the compensation claim, as well as any additional expenses or loss of income that the claimant incurs. There are a number of different types of liability insurance.
Types of liability insurance
Employer’s liability insurance covers you if an employee makes a compensation claim against you. This type of liability insurance is a legal requirement if you have any employees and there are hefty penalties if you trade while uninsured.
Public liability is similar, but covers compensation claims made by third parties rather than employees. This type of liability insurance is not a legal requirement, but it would be unwise for a salon to consider trading without it given the potential for a large compensation claim to be made against them.
Products liability insurance also covers compensation claims made by third parties, but rather than covering compensation claims arising from something that you have done or failed to do, it covers compensation claims arising from defects in products that you have sold or supplied.
Public and products liability insurance only covers compensation claims involving an injury or property damage. This means it wouldn’t cover a model’s loss of earnings because that model couldn’t work while waiting for a treatment that had gone wrong to be dealt with. Claims made by photographers or film producers for lost income or additional hiring charges in this situation wouldn’t be covered, either.
Liability insurance extensions
Your salon insurance policy should include a financial loss extension. This extension extends the liability insurance cover so that it applies to purely economic losses such as these, protecting you if such a claim is made against you.
A salon insurance policy should also include a treatment risk extension. Standard liability insurance policies exclude cover for compensation claims arising from the delivery of professional services. As the hair and beauty industry is a profession, you could find yourself uninsured without this important extension. With the treatment risk extension, any claims arising from treatments you’ve provided will be covered.
Other optional types of insurance
There are a number of optional extra insurance covers that are available to salons.
These include personal accident insurance that covers you if you are unable to work due to an injury or an illness, as well as legal expenses insurance, which protects you against unexpected legal costs if you find yourself involved in legal action.