Salon insurance is a category of insurance coverage for salons, barber shops, and spas. The most common form of salon insurance is commercial general liability, which covers third-party bodily injury, property damage and theft on your premises. Salon insurance costs for most small businesses typically run from $350 to $750 per year in premium.
For a free, no obligation quote check out The Hartford. Their team of experts will work with you to find the policy that meets your hair salon’s needs.
Best Hair Salon Insurance Providers
|The Hartford||Hair salons wanting multiple insurance coverage types that can be included in a business owners policy (BOP).|
|Insurance321||Business owners who want access to a marketplace of insurance carriers. Get multiple quotes in as little as four minutes.|
|Hiscox||Quick, easy online applications and quote process for salons & spas|
|Allstate||Salon business owners wanting a large provider with a local agent to help you sign up and work through any claims on your policy.|
When shopping for salon insurance, you will speak with a captive insurance agent or an independent agent, or you may work with a broker. The captive agent represents a single insurer while the independent agent represents multiple insurers, and brokers represent the insured or the customer, not an insurer. Regardless of what you choose, we recommend you get at least three quotes from three different providers before purchasing your policy.
Here are four of the top hair salon insurance providers:
1. The Hartford
The Hartford is a large insurance agency, which can be an advantage, even for small business owners. Large agencies have greater capital funding, which is important for meeting large claims should they arise. The Hartford offers several coverage types, including the popular business owners policy (BOP).
Salon businesses that will need multiple coverage types in a BOP will want to consider The Hartford. They also offer specialized coverages that are not as common for hair salon owners, such as insurance for backup of sewage and drains. If you’re looking for a traditional insurance provider, this is likely your best option.
Insurance321 is an online insurance marketplace that helps hair salon owners find customized insurance policies to meet their business needs. Insurance321 is a good match for salon owners who want simple, yet complete coverage for their business. Receive multiple insurance quotes in as little as four minutes, and get affordable coverage to protect your establishment.
As a small business insurance specialist, Hiscox takes great strides to understand the unique risks faced by specific industries. This knowledge allows Hiscox to provide customized coverage to its clients in the salon and spa industry. Moreover, salon owners can pay their annual premiums in monthly installments at no additional charge. Quotes are available online after you complete a brief, no-obligation application.
Allstate is a large, highly rated insurance company that provides salon insurance coverage for beauty salons, nail shops, and barber shops. They offer commercial general liability and commercial property insurance, and offer the most popular policy type for small businesses, which is the business owners policy (BOP).
Salon business owners wanting a local agent should consider Allstate. Although they are one of the largest U.S. insurance providers, their presence in thousands of communities across the country allows for greater customer service focus at the local level.
How Stylist Insurance Works
Salon insurance is not a specific type of insurance but rather a combination of coverage types specialized for beauty salons. Most salon businesses choose a business owners policy (BOP) for their insurance coverage. The BOP is an insurance policy that typically bundles commercial general liability (CGL), property insurance, and business interruption insurance together into one package for cost efficiency.
The CGL policy covers third-party bodily injury, property damage, medical bills and related legal expenses. You may need other types of insurance to properly cover the risk exposures unique to your business. For example, to protect your own assets, such as the building you own and your supplies, equipment and inventory, you’ll also need commercial property insurance.
Types of Hair Salon Insurance
|Commercial General Liability (CGL)||Third-party claims for bodily injury, property damage, medical payments and personal and advertising injury|
|Professional Liability Insurance (also called Errors & Omissions)||Damages due to mistakes, your negligence or failure to fulfill contractual obligations|
|Business Interruption||Loss of income when a covered claim causes suspension of business operations; often included in a business owners policy (BOP)|
|Commercial Umbrella Insurance||Extended coverage on other insurance types|
|Commercial Property Insurance||Assets owned by the business, such as building, equipment, and inventory|
|Workers Compensation||Work-related injuries, medical bills, wage replacement and more for your employees; required in most states|
|Commercial Vehicle Insurance||Repairs and lawsuits from accidents involving vehicles used by the business|
Hair Salon Insurance Costs
The BOP for salon insurance costs range from $350 to $750 per year for most small businesses. The BOP for a salon commonly includes commercial general liability, commercial property insurance, and business interruption insurance coverages. Businesses that need additional coverage, such as workers compensation, may pay above this range.
Salon Insurance Costs by Coverage Type
|Type of Insurance|
|Commercial General Liability|
|Professional Liability Insurance|
|Commercial Property Insurance|
|Commercial Umbrella Insurance|
|Commercial Vehicle Insurance|
How to Apply for Hair Stylist Insurance
Applying for hair salon insurance can be a simple process if you take a few important steps to prepare. Although the insurance coverage needs of each salon business are similar, some businesses will need more coverage than the basic business owners policy. Depending upon several factors, such as the services and products you offer to clients, the size and revenue of your business, and if you have employees, you may need a more customized insurance package.
Here are three of the most important things to remember when applying for hair salon insurance:
1. Gather Documents You Need Before You Apply
You know your salon business, but you might not know which insurance types you need. To ensure you get the right coverage, be sure to gather all the information that will be needed for the application or initial quote. This will help the insurance agent, broker or underwriter know how to best protect your business against risk exposures common in the salon industry.
These documents will help you prepare to apply for salon insurance:
- Business contact information
- Building lease, if applicable
- Number of employees
- Value of assets, such as chairs, equipment, products and inventory
- Type of potentially hazardous services you offer, such as chemical treatments on hair
- Type and amount of your customers’ personal data you store
- If and how you ship products to customers
- Number of years you’ve personally worked in the industry
- Number of years your business has been in the industry
- Information on other insurance coverage you already have
- Claims history (at least the past three years)
Having the appropriate information ready for your agent or broker will help you get the coverage you need. According to Mary Graf, Graf Insurance:
“Have an open conversation with your insurance broker to discuss your current situation, including staffing, amount you have invested in the salon, such as chairs, inventory, and artwork. This way you can determine what risk exposures you have. Have a copy of your lease ready so you can review the insurance requirements together. Often your broker can help with different coverage options, deductibles, and payment plans that suit your particular operation and for satisfying the requirements of your landlord.”
2. Choose a Provider Who Knows the Salon Business
Salon insurance is industry-specific, which means there are risk exposures and insurance needs that are unique to your business, such as injury or damage caused by hair products that you use. If you work with an insurance agent or broker who knows your business, you’ll have a better chance of getting the right coverage at the best price.
3. Complete the Application
Completing the application sounds like an obvious step in the application process, but what’s important here is that you don’t leave out information, which can cause you to be underinsured or result in rejected claims. For example, if you forgot to mention to your provider that you sell products to customers, you may not be covered for professional liability.
Most Common Types of Salon Insurance Coverage
There are several types of insurance coverage that salon business owners may need, but there are up to three main types required. Many salon business owners can get the basic coverage they need with commercial general liability, but some will also need commercial property insurance. These two coverage types can be bundled into one package called a business owners policy (BOP).
Here are details on the four types of insurance coverage that most salon business owners need:
1. Commercial General Liability
Commercial general liability (CGL) insurance covers third-party bodily injury, property damage, medical payments and even personal and advertising injury. This is the main coverage type every salon business owner needs to buy because claims from third parties are the most common claims. Also, a CGL policy is often required to get a business license.
For example, if a customer slips and falls in your salon, your CGL policy will pay their medical bills or damage. Liability claims can be the greatest financial risk to salon business owners, especially if you own or lease a building.
Some liability claims can result from a simple oversight but can lead to expensive lawsuits. According to Keith M. Fletcher, Simmons and Fletcher, P.C.:
2. Professional Liability Insurance
Professional liability insurance, also called errors and omissions insurance (E&O), protects your business against claims arising from damage caused by your negligence or mistakes in delivering your service to clients. Whether a mistake is your fault or not, professional liability insurance will help pay for lawsuits if clients sue you.
For example, let’s say one of your employees makes a mistake and uses a product on a customer that ends up causing severe scalp burns. The customer is extremely upset and sues you for damages. Professional liability insurance would cover the cost of the lawsuit, even if the damage was purely accidental.
“Many products contain formaldehyde, which can cause severe burns to the scalp. While a simple strand test can prevent a severe perm burn from happening, one act of carelessness by you or an employee could result in your business being bankrupted.”
3. Business Interruption Insurance
Business interruption insurance covers a loss of income to your salon business resulting from a covered event. If your salon is forced to close because of fire or extreme weather, business interruption coverage will cover income that is lost during the closure. This coverage is often included in a business owners policy (BOP).
For example, a fire can do damage to your salon that can cause you to close the doors to your customers for days or weeks. The revenue lost while the damage to your salon is being repaired can be covered by business interruption insurance, whether you own or lease the space. This can be crucial if you have beauty salon business loans that need to paid, regardless of your salon’s financial status.
4. Commercial Property Insurance
Commercial property insurance covers the assets of your business, such as your salon and the contents within it. Property Insurance may protect your business against losses due to fire, theft, vandalism, and extreme weather. The greatest risk exposure to small businesses with brick-and-mortar locations is theft. This makes property insurance a must for salons in most locations.
Commercial property insurance is required coverage because it helps protect the place where you operate your hair salon and the tools and equipment you use every day, like furniture, styling brushes, curling irons, and computers, whether you own or lease them. It’s important to note that, if you’re working out of your home, your personal insurance likely won’t cover damage to business assets. Therefore, you may need commercial coverage in addition to personal.
Other Types of Hair Stylist Insurance Coverage You May Need
Many salons need coverage types outside of the most common insurance policies like commercial general liability. This will depend on things such as whether or not you own the building where you work, if you have direct employees instead of independent contractors, and if you use a vehicle for your business other than commuting to and from work.
1. Commercial Umbrella Insurance
Commercial umbrella insurance extends the limits on other insurance types. Umbrella insurance coverage is therefore not used to protect against a specific risk exposure, like other insurance types such as general liability or commercial property insurance. Instead, it adds coverage wherever you need it, with limits being expanded in increments of $500,000 or $1 million.
Umbrella insurance is needed when the standard liability limits on other policies, such as $1 million, is not sufficient coverage to protect against the typical risks involved with salons and related businesses. Since the needs for this coverage can be difficult to measure, business owners should speak with their provider for guidance.
2. Workers Compensation Insurance
Workers compensation insurance provides benefits to stylists, assistants, receptionists and other employees of your hair salon or beauty shop for work-related injuries or illnesses. Coverage includes medical bills, wages from lost work time, and more. Workers comp is required in most states if you have one or more employees.
Since most salons, beauty shops and barber shops have employees, workers compensation is required coverage for the owners. The cost of coverage depends upon risk exposures, the number of employees working for you, and the state where you work. However, most small businesses in service-related industries pay an average of 1 percent of wages per employee for annual workers compensation premiums.
3. Commercial Auto Insurance
If you use a vehicle in your work, whether it is owned by you or the business, and it is involved in an accident, commercial auto insurance will cover you for repairs and related lawsuits. This insurance can also include protection against an uninsured or underinsured driver. In general, you should have a commercial vehicle insurance policy if you or your employees use a vehicle for business purposes other than for commuting to and from work.
For example, if you use your own car to visit clients for house calls or to pick up beauty supplies for your hair salon, you’ll need commercial auto coverage. It’s important to note that commercial coverage for your business is not typically included in a personal auto insurance policy.
Who Needs Hair Stylist Insurance
Every business owner in the salon industry needs at least some degree of insurance protection. In fact, some coverage will be required by lenders, landlords, or local municipalities. This is primarily because you work with the public, which opens yourself and your business to a range of risk exposures.
These three types of business owners will need hair stylist insurance:
1. Salon Owners
Hair stylist insurance for salon owners will include commercial general liability and commercial property insurance, which can be combined into a business owners policy (BOP). If the salon owner has employees, most states will require them to have workers compensation coverage. Many salon owners also get professional liability insurance to cover lawsuits arising from mistakes or negligence.
2. Hair Stylists Renting Chairs in a Salon
Hair salon professionals renting a chair, sometimes referred to as booth renters, will need commercial general liability at a minimum. To cover equipment, tools and supplies, they may also need commercial property insurance. The most popular insurance type for booth renters is a business owners policy (BOP), which combines both general liability and property insurance into one package.
3. Home-Based Business Owners
If you run your salon business out of your home, don’t assume that your personal homeowners insurance will cover you. The primary type of salon insurance for home-based business owners is commercial general liability, which covers you if a customer slips and falls on your property. Talk to your insurance representative about other coverage types you may need.
According to James Lynch, Chief Actuary and Vice President of Research and Education at the Insurance Information Institute (III):
“Generally, the most cost effective and efficient way to provide property and liability insurance for a small business is with a BOP specifically tailored to your needs. The business owner usually gets a discount for bundling the coverages, as the insurer saves money on marketing and administrative costs. Also, you won’t have to look up different policy numbers or deal with several different insurers. Everything is in one place to add convenience and increase efficiency.”
There are many different types of salon businesses, which means that each business will have unique insurance needs and respective risk exposures that need to be protected with the appropriate policy type. To get a better idea of what insurance types you need, it’s important to speak with an insurance representative and get a quote from a top insurance provider.
The Hartford has a team of experts who will work with you to identify your needs and make sure your salon is covered. Get your free, no obligation quote online in minutes.