Beauty salon insurance
Which types of business insurance do beauty salons need?
What is ‘beauty salon insurance’?
‘Beauty salon insurance’ isn’t a product on its own; rather, it refers to a set of business insurance packages that can financially protect salon owners from various potential risks, including liability claims, property damage, equipment malfunctions and more. It can provide you with peace of mind as a business owner by ensuring that you’re covered for unexpected incidents.
Business insurance for beauty salons can cover a variety of beauty professionals and their business activities, including hair salons, barbers, nail salons, makeup artists, beauticians, facial clinics and hair removal services, among others.
Running a beauty salon in Australia is more than just providing excellent service, as the beauty industry is hands-on, personal and inherently carries certain risks. That’s where business insurance for beauty salons becomes essential.
Why do beauty salons need business insurance?
Operating a beauty salon involves multiple risk exposures every day. Whether you’re a small business operating a home-based salon, a mobile business or running a multi-chair setup in a commercial space, business insurance can be the safety net that keeps your company running smoothly in the face of adversity.
Business insurance for beauty salons may offer you financial cover for liability costs, especially if your clients suffer from allergic reactions, burns or injuries from treatment. Depending on your type of business and your level of cover, it can also help you safeguard expensive equipment, provide cover for property and stocks that you have, and ensure that if an insured event forces you to close temporarily, you can be covered for the loss of income and ongoing expenses.
Common risks in a beauty salon
The beauty industry is built on trust, skill and close client interaction, but these factors introduce various risks that can affect your staff, clients, premises and reputation. Understanding these risks is essential to selecting the right business insurance cover.
Common risks in a beauty salon may include:
- Physical injuries (e.g. tripping over wires and cords or slipping on the wet floor)
- Adverse reaction to beauty treatments or products
- Professional negligence
- Equipment malfunction or breakdown
- Theft or vandalism
- Property damage.
What business insurance policy does a beauty salon need?
Public liability insurance
Public liability insurance is often considered essential and is foundational business insurance that beauty salon owners should consider. It covers your beauty business for your liability if someone gets injured on your premises. For example, if a client slips on a wet floor and breaks their wrist, your public liability insurance covers their medical costs and legal action.
Professional indemnity insurance
Professional indemnity insurance covers you and your staff from claims of negligence, errors or omissions against your beauty business while you provide your services.
Professional indemnity insurance can be particularly important if you’re a beauty therapist who offers treatments like chemical peels, injectables or other skin therapies. For example, if you run a facial salon and a client alleges a facial treatment caused long-term skin damage after seeking professional advice from you and sues for compensation, you may be covered for the compensation cost and even for the legal fees of the lawsuit.
Product liability insurance
Product liability policies cover you for claims made against the products used, supplied or sold by you to a third party. If you sell or apply products in your salon, you’re at risk of claims due to allergic reactions or product faults. This insurance can cover legal and compensation costs. For example, if you’re a nail technician and your client had an allergic reaction after using the nail polish you sold them, you may be covered for the compensation cost.
Other insurance to consider for your business needs
- Property insurance
- Equipment insurance
- Business interruption
How much is business insurance for beauty salons?
The cost of business insurance for beauty salons in Australia can vary significantly and depends on your type of business and the level of cover you want. Bundling your policies into a business package can often provide better value and broader coverage than sourcing each policy individually.
Factors that may affect your insurance premiums may include:
- The size and location of your salon
- The range and nature of services offered
- Your claims history
- Number of employees
- Value of your contents and equipment
- Annual turnover.
You can get several insurance quotes from different insurance companies and choose the best type of cover for your business based on your financial situation and business needs.
Always read the policy wording on your Product Disclosure Statement (PDS) and the Target Market Determination (TMD) to know the inclusions and exclusions of your insurance policy, and that the policy is the right fit for your business.
Meet our business insurance expert, Adrian Taylor.
As a General Insurance expert with over 13 years’ experience in financial services, Adrian Taylor strongly believes in the protection and peace of mind that all types of business insurance provide business owners. Adrian says this type of cover can be the difference between a business staying afloat and going under if trouble arises.