Salon and Spa Insurance

Having the right coverage for your salon or spa can help protect you against major financial losses from customer lawsuits, product issues, theft, vandalism, and more.

Christine Lacagnina Written by Christine Lacagnina
Christine Lacagnina
Written by Christine Lacagnina

Christine Lacagnina has written thousands of insurance-based articles for TrustedChoice.com by authoring consumable, understandable content.

Reviewed by Cara Carlone
Reviewed by Cara Carlone

Cara Carlone is a licensed P&C agent with 20 years of experience. She has her P&C license in RI and TX and holds CPCU, API, and AINS designations.

Updated
Hair washing and rinsing in fancy hair salon. Find Salon Insurance.

Hairdressers, barbershops, salons, and spas face all kinds of risks on a daily basis, just like all other types of businesses. If you’re a hairstylist or barber or a salon or spa owner, your clients depend on you to help them look and feel their best. But no matter how careful you may be, accidents happen. A customer could file a lawsuit against you, costing you hundreds of thousands of dollars, an employee could get injured at work, or your valuable inventory could get stolen. Without the right salon and spa insurance, your business could face a devastating financial loss.

Fortunately, you can protect your assets, savings, and revenue with the right insurance. Independent insurance agents can help you find the right salon and spa coverage for your business. But first, here's a closer look at salon and spa business insurance.

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What Is Salon and Spa Insurance?

Spa and beauty salon insurance exists to protect hair and beauty salons, spas, and barbershops and their owners. Packages are made up of a special form of business insurance with a focus on a spa, salon, or barbershop. 

Your insurance policy accounts for common hazards, ranging from fire damage to legal issues. Hair salon, spa, and barbershop insurance combines several necessary coverages in one convenient package.

Why Is Salon and Spa Insurance Necessary?

Most hair salons and spas in the U.S. are one-shop businesses, or small, local chains. Their small size makes them more vulnerable to financial losses due to fires, storms, break-ins, or lawsuits. All it takes is for a fire to destroy your property or a bad bleach job to ruin your salon dreams if you don’t have the right insurance in place.

Salon and spa insurance can protect your business against many potential financial losses. A comprehensive policy will include protection for your business's property, hair salon workers' comp insurance to protect your employees, liability coverage to protect you from lawsuit expenses, and other types of key coverage. An independent insurance agent can help you find the right salon and spa insurance policy.

Who Needs Salon and Spa Insurance?

Salon and spa insurance policies can be formatted to fit many different types of businesses in the beauty industry. These policies can be written for the following businesses and professionals:

  • Hair, tanning, and beauty salons
  • Barbershops
  • Spas
  • Estheticians
  • Cosmetologists

If you own one of these businesses or work in any of these professions, you'll find the coverage you need in a salon and spa insurance policy.

Top Liability Risks for Salons and Spas

Salon and spa owners face numerous liability risks on a daily basis. Just a few risks you need to consider when building your insurance policy include the following:

If You Hire Beauty Contractors:

The hair stylists, manicurists, and massage therapists who rent space in your salon may not be covered by your general liability insurance policy if they cause bodily injury or property damage to one of your clients. Stylists can face lawsuits over something as small as a bad haircut, and these suits can be just as financially destructive as a bodily injury claim, like a chemical burn or an allergic reaction.

Consider requiring all of your beauty contractors to carry professional liability insurance. This can provide financial protection for both the contractor and, in turn, the salon to protect against litigation stemming from accidents from your services. It can reimburse businesses for third-party claims of professional errors and omissions made by your business.

If You Sell Beauty Products:

If there’s a problem with a product you sell, like a manufacturing flaw or a chemical imbalance in a hair care product, you could be partially liable for any illness or injury your customer suffers. A faulty product suit can affect all parts of the distribution network, from the manufacturer all the way down to the seller.

If you carry personal care products on your shelves, like shampoos, oils, nail lacquers, soaps, massagers, and so on, you can likely benefit from product liability insurance. Product liability provides financial protection for your salon if one of your products causes injury to your customers. That way, you don't have to pay for a manufacturer's mistake.

If You Allow Customers and Guests on Your Premises:

Customers, delivery workers, guests, and other third parties could potentially suffer bodily injury or personal property damage on your business's premises. This can happen due to slips on a wet floor, trips over products left out, and many other possible incidents. Your general liability insurance can reimburse your business for third-party claims of personal property damage or bodily injury.

What Does Salon and Spa Insurance Cover?

If you’re like the majority of salon owners, your small business is your livelihood. Whether you’re just getting started or beginning to expand to new locations, you need the right salon and spa business insurance to keep your investment secure. In addition to the critical liability protection mentioned above, also look for the following types of coverage in your policy:

  • Commercial property insurance: This covers property you keep at your salon or spa, like computers, counters, chairs, tanning beds, styling equipment, and product inventory, in addition to the physical building itself. It can reimburse you for property damage, theft, vandalism, or destruction due to fires and other covered disasters.
  • Workers compensation insurance: This can cover an employee's medical bills, a portion of lost income, and rehabilitation expenses if they get injured or ill due to the work environment or job duties. Workers comp for hair salons and spas also protects your business from lawsuits since state laws prohibit employees from suing their employer for their work-related injury or illness if they carry workers comp.
  • Cyber liability insurance: This coverage protects your salon or spa in case its computer system gets compromised, and customers' or staff’s sensitive data is stolen or sold following a data breach or other attack. Coverage protects against financial and legal ramifications following a breach of your network.
  • Product recall insurance: This coverage reimburses you for fees relating to a bad batch of dyes or other products you sell that get recalled. Coverage can also reimburse you for public relations fees related to the recall to help protect your business’s reputation.
  • Business interruption insurance: This coverage reimburses you for lost wages and revenue if your business must temporarily be shut down due to a covered disaster.
  • Commercial umbrella insurance: If your salon, spa, hairdresser, or barber business is especially large, turns over a lot of business, and is at risk of especially costly lawsuits, you may want excess liability protection. Umbrella policies can extend the liability coverage limits provided by your underlying policy in increments of $1 million and are highly affordable, too.

An independent insurance agent can help review your specific coverage needs and ensure that you get equipped with all the policies necessary to maintain smooth operations for years to come.

Additional Salon and Spa Insurance Coverages to Consider

Your salon and spa insurance policy may not yet be complete. Depending on the types of services you provide, you may need some or all of the following types of coverages:

  • Drain and sewer backup coverage: This coverage can pay for the costs of water damage to your walls and floors if your drains become clogged with hair or debris.
  • Fire legal liability: If you’re sued over a fire that starts inside your salon or spa, this can cover your legal fees, including settlements or judgments. 
  • Equipment breakdown coverage: If your salon is dependent on equipment like tanning beds, computers, and other machines for revenue, this coverage can help you repair these items after covered disasters.
  • Inland marine coverage: This provides financial protection for equipment that’s in transit or storage from incidents of theft, vandalism, damage, or other loss. If your employees perform esthetician services, hair care, or spa services in outside locations, like weddings and private homes, inland marine coverage protects you from equipment loss on the go.

Your independent insurance agent can help recommend any coverage add-ons you may need to include in your salon and spa insurance policy.

Special Coverage for Your Home-Based Salon or Spa Business

If you provide hair beautifying or other salon or spa services out of your home, you could be exposing yourself to a number of additional risks. If you depend on your homeowners insurance to cover your in-home hairdresser or barber business, your finances and your home could be at risk. 

If a client accidentally slips on your front steps and suffers an injury after a haircut, your homeowners insurance may not protect you from any resulting lawsuits. Usually, you can purchase home-based business insurance as an inexpensive rider to your homeowners policy or as a separate policy. Your in-home business policy would cover:

  • Business inventory
  • General liability for slips, falls, and other accidents on-site
  • Damage or loss to your business property and equipment

Ask your independent insurance agent about adding an endorsement to your home insurance policy if you offer any salon or spa services at your home.

Salon and Spa Insurance Exclusions

While salon and spa insurance provides a lot of important coverage for your business, it also comes with certain exclusions. Some of the most common exclusions are as follows:

  • Breakdown of major appliances
  • Temperature changes
  • Inexplicably lost inventory
  • Power outages
  • Robbery
  • Pollution
  • Routine maintenance fees
  • Earthquake damage
  • Nuclear reaction and war
  • Dishonest acts by staff
  • Flood damage*

*If your business is located in a state that’s prone to flooding, you’re likely to want to purchase a separate flood insurance policy. Or you might even already be required to have it by your business’s mortgage lender. Your independent insurance agent can provide you with more information about finding coverage.

How Much Does Salon and Spa Insurance Cost?

The cost of your policy will vary based on several factors, like your business's location and your annual revenue. On average, insurance for salons, barbershops, etc., costs between $360 to $6,900 per year. Larger businesses will pay more for coverage, while smaller businesses will pay less. 

The insurance provider you choose to underwrite your coverage will also impact your policy's rates. Your independent insurance agent can help provide exact figures and quotes for your area.

Things to Keep in Mind When Shopping for Salon and Spa Insurance

Before meeting with an independent insurance agent to discuss your salon and spa insurance options, it's helpful to keep these points in mind:

  • The value of your business's structure
  • The value of your business's inventory and products
  • The value of any upgrades you've made to your business
  • How prone your specific area is to certain natural disasters, like hurricanes
  • Your specific products and their risk level to the public
  • The size of your company's team

Considering these factors beforehand can seriously help streamline the process of shopping for the right salon and spa insurance policy and getting your business properly insured.

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Here's How an Independent Insurance Agent Can Help

Independent insurance agents excel at matching the appropriate policy to the business in need. Shopping around for insurance policies can be tricky, confusing, and time-consuming, and an independent insurance agent's role is to simplify the process. 

These agents have access to multiple insurance companies, so they can shop and compare quotes for you. And down the road, your agent will still be there to update your coverage as your business evolves and can even file business insurance claims for you.

FAQs about Salon and Spa Insurance

All salons and spas need commercial property coverage, business income coverage, and various forms of liability protection. Whatever type of salon or spa you run, you'll still want to have professional liability, general liability, cyber liability, and product liability coverage. 

Yes, you still need insurance if you run your business out of your home. Standard homeowners insurance excludes business liability claims, so if you run any type of business out of your home, even part-time, it's imperative to have separate coverage. You'll want to at least look into a business owners policy (BOP) if your salon or spa business is home-based.

Standard personal auto insurance policies exclude business use of your vehicle. If you run a mobile hairdresser business or make deliveries, you'll need a commercial auto policy. However, in certain cases, you'll need a non-owned or hired commercial auto insurance policy if you're using your personal vehicle. 

Booth renters are technically small business owners, and are usually 1099 employees, AKA self-employed or independent contractors. Owners of salons, spas, hairdressers, and barbershop businesses need to ensure that booth renters on their property are classified as independent contractors for tax purposes.

It's certainly a good coverage to consider for your business. Hair and product buildup can easily clog drains, leading to flooding and other water damage or busted piping. An independent insurance agent can help you add a sewer backup endorsement to your business insurance policy.

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