Without the right type of esthetician insurance, your business could face serious liability and financial consequences.<\/p>
If you\u2019re an esthetician, liability insurance is essential to protecting your business. Estheticians perform procedures that can sometimes produce unwanted results, and one lawsuit from an angry customer has the potential to destroy your career and leave you broke if you\u2019re uninsured.<\/p>
Whether you\u2019re a medical esthetician, skin care specialist, waxing professional, or spa worker, you\u2019ll need a policy that includes at least professional liability coverage and general liability coverage.<\/p>
Esthetician insurance is a policy that has several types of\u00a0small business insurance tailored to meet the risks that come with the profession. Running a beauty business presents plenty of unforeseen challenges. <\/p>
Consider these two scenarios: An allergic reaction leads to a facial client\u2019s discomfort and potential liability claims, or an employee gets hurt while providing a pedicure. If a client suffers an adverse reaction to treatment and sues your business, the general liability portion of your esthetician insurance would cover your legal costs.<\/p>
Esthetician insurance includes several\u00a0types of small business insurance\u00a0that cover a wide range of problems, such as accidents, lawsuits, stolen inventory, damaged tools, and lost income.<\/p>
A good place to start is with a\u00a0business owner’s policy (BOP). A BOP establishes a strong coverage foundation by combining three essential coverages, and it\u2019s usually cheaper than buying each coverage type separately.<\/p>
Here are the three types of coverage included in a BOP. You can add extra coverage on top of a BOP to customize it for your own business risks.<\/p>
This is the foundation for your esthetician insurance policy. It covers accidental injuries and property damage to others, as well as coverage for problems such as advertising injury, copyright infringement, and reputational harm.<\/p>
For example, if a client slipped on a wet spot in your spa, the\u00a0general liability\u00a0portion of your policy would cover their medical bills.<\/p>
Commercial property insurance\u00a0covers the physical location of your esthetician business and your business equipment, like your tools and inventory. It covers problems such as fires, storms, theft and vandalism.<\/p>
If you have to temporarily close your esthetician business due to a problem covered by your policy (like theft or fire),\u00a0business interruption insurance\u00a0covers your lost income. This coverage type is also known as \u201cbusiness income insurance.\u201d<\/p>
A BOP is a great start to your esthetician insurance plan, but you\u2019re going to need to augment your policy with additional coverage types.<\/p>
Here are several types of coverage you might want to consider incorporating into your policy.<\/p>
Commercial umbrella insurance\u00a0is an extra layer of protection on top of your general liability insurance. For example, if your esthetician gets sued for $800,000 and your general liability limit is $500,000, umbrella insurance would cover the $300,000 shortfall.<\/p>
Errors and omissions insurance\u00a0(E&O) covers your esthetician business for claims of professional mistakes and services, even if the claims have no merit. For example, if your esthetician business gets sued because your treatment plan fails to deliver promised results, your E&O coverage would pay for your legal costs.<\/p>
Errors and omissions is also called\u00a0professional liability insurance.<\/p>
If you use a vehicle for your esthetician business, you\u2019re going to need a\u00a0commercial auto insurance\u00a0policy. Your personal car insurance policy won\u2019t cover work-related accidents.<\/p>
Like a BOP, a commercial auto policy combines several coverages into one policy. Here are some of the types of coverages you can expect to see:<\/p>
When you or your employees use a personally owned or rented vehicle for business, this insurance covers injuries and property damage accidentally caused to others. For instance, if your employee drives a rented car to haul supplies from one salon to another and crashes into someone\u2019s pickup truck, this coverage could kick in.<\/p>
Workers compensation insurance\u00a0is required in most states, even if your esthetician business has only one employee. If your employees get sick or hurt while performing job-related duties, workers comp covers expenses such as lost wages, medical care, and physical therapy.<\/p>
Esthetician insurance costs less than $70 per month for a business owner’s policy,\u00a0according to Insureon. Nearly a third (30%) of beauty and personal care professionals pay less than $50 per month and about half (46%) pay between $50 and $100 per month.<\/p>
Your esthetician insurance costs will vary depending on cost factors such as:<\/p>
Next Insurance offers general liability, professional liability, commercial auto, workers compensation, and commercial property insurance to estheticians in a customizable package with premiums starting as low as $134 per year. Monthly billing options are available.<\/p>
Next is a great choice for estheticians who prefer to transact online, with a highly rated mobile app and online portal you can use to manage your policy, file a claim, and share your digital\u00a0certificate of insurance\u00a0with anyone. There\u2019s even a live chat feature with a U.S.-based support team.\u00a0<\/p>
Next offers three tiers of coverage: Pro Plus, Pro, and Basic. Each tier covers commercial auto, general liability, workers\u2019 compensation, and commercial property insurance, but has different coverage limits, depending on the tier. For example, the Pro Plus tier has the following limits: <\/p>
One downside is that professional liability coverage is claims-made, but general liability coverage is occurrence form. So if a lawsuit is brought against you after your policy expires, you may or may not be covered, depending on the type of lawsuit.<\/p>
The Hartford is ideal for estheticians who want to create a fully customized, comprehensive policy, particularly businesses that have employees. You can get a business owner\u2019s policy, which includes general liability, commercial property, and business income insurance, and add professional liability and product liability coverage to cover a wide range of incidents. You can also get\u00a0workers\u2019 compensation insurance\u00a0if you have employees.<\/p>
Coverage isn\u2019t mobile\u2014you\u2019ll need to specify where you work to get a quote\u2014but you can get a policy that covers you if you travel to clients\u2019 homes. The available limits also vary based on your location and revenue. For example, we found coverage available up to $2 million per occurrence and up to $4 million per year in one location, but up to $2 million per occurrence and up to $3 million per year in another.<\/p>
The Hartford offers both claims-made and occurrence-form policies, depending on the type of coverage. The company also gets high marks for financial strength and customer satisfaction, with an A+ (Superior) financial strength rating from AM Best and very few complaints with the NAIC.<\/p>
A membership to Associated Skin Care Professionals (ASCP) includes professional, general, and product liability coverage as well as educational and marketing resources useful for advancing estheticians\u2019 careers. The policy covers up to $2 million per occurrence and up to $6 million per member per year, one of the highest coverage limits we\u2019ve seen.<\/p>
What\u2019s more, ASCP will also cover any legal fees that go above and beyond those limits. The policy costs $259, and you can add $10,000 in business personal property insurance for an additional $95. The company also offers coverage for advanced esthetic services, such as LPL and CoolSculpting.<\/p>
ASCP policies are\u00a0underwritten\u00a0by Allied Professionals Insurance Company, which has an A- (Excellent) financial strength rating with AM Best.7\u00a0That\u2019s the lowest grade we typically recommend, but AM Best predicts a positive outlook for the company. The company also had only one complaint with the NAIC over the last three years for professional liability insurance.8<\/p>
Reviews about the company on third-party sites are positive as well. ASCP provides occurrence form coverage, so you can remain protected for incidents that occurred while your policy was in effect, even after your policy expires.\u00a0<\/p>
Policies offered by the National Association of Complementary and Alternative Medicines (NACAMS) are underwritten by Arch Specialty Insurance Company, which has an A+ (Superior) financial strength rating with AM Best and far fewer complaints with the National Association of Insurance Commissioners (NAIC) than expected given its size.<\/p>
Additionally, customers rave about the service NACAMS provides policyholders on third-party review sites. NACAMS offers occurrence form coverage, which means you\u2019ll be covered if the incident occurred while the policy was active, even if you file a\u00a0claim\u00a0after the policy expired. However, bear in mind that when your policy expires, so does your coverage in many cases.<\/p>
Though NACAMS does not offer\u00a0business personal property insurance, estheticians who rent their facilities and equipment will be protected with up to $100,000 in coverage if the rental space is damaged and up to $1,000 in coverage for stolen, damaged, or lost rental equipment. An identity protection plan is also included.<\/p>
Plus, you\u2019ll get bonus perks, like discounts on business supplies and a free professional website. Policies are affordable compared to other companies, and monthly billing options are available, as is pricing for students.<\/p>
Beauty & Bodywork Insurance offers the cheapest premiums of the companies we reviewed. Students pay $67 annually while professionals pay $96 annually. For that low price, you get up to $2 million in coverage per occurrence, $3 million\u00a0aggregate\u00a0for general and professional liability claims, and $3 million aggregate for product liability claims.<\/p>
Personal and advertising injury coverage is also included, as is $300,000 in rental damage coverage. You can also add an additional insured for $15. The drawback to the policy is that it\u2019s claims-made, so you\u2019ll only be covered for claims made while the policy is in effect.<\/p>
Beauty & Bodywork Insurance policies are underwritten by Great American Insurance Company, which has an A+ (Superior) financial strength rating with AM Best and far fewer complaints with the NAIC than expected given its size.<\/p>
Beauty & Bodywork Insurance also has excellent customer service reviews on third-party websites. However, the company offers fewer coverage options than insurers like Next or The Hartford.<\/p>
Esthetician insurance policies do not cover every unforeseen incident. Here are several common exclusions:<\/p>
To put together an esthetician insurance policy, you\u2019ll need a good mix of coverage types to meet your industry\u2019s risks. Small business insurance companies include:<\/p>
Here are six things you can do to lower your costs for esthetician insurance.<\/p>