In the January 2012 issue of Skin Inc. magazine, the “Reader’s Ask ...” column featured the question: Where do I start with insurance—what should I be looking for, what should I offer my employees and how do I find reputable companies? Following are additional tips from industry expert Mary Lynne Blaesser of Marine Agency Corporation about how to make the best insurance choices for your spa.
When purchasing insurance for your day spa or salon, being prepared is essential. This is an important financial decision that could preserve or destroy the business that you have worked so hard to establish. Major parts of the risk of any business are liability to others and the loss of critical equipment. Either of these could cause a loss of income that could force you to close your doors. Insurance allows you to transfer these risks to the insurance company, offering you protection and security. The following are the three major types of insurance required to properly protect your business investment:
- Professional liability. Protection from lawsuits arising from services performed.
- Premises/Product liability. Protection from lawsuits arising from the operation of the business and product sales.
- Property coverage. Protection for business contents and building (optional) against losses due to perils such as fire, smoke, lighting, riot, wind, explosion, vandalism, malicious mischief, burglary, theft and other direct causes of physical damage not otherwise excluded by the policy.
Your employees should be included in the professional liability policy for the services they are rendering. If they are independent contractors or booth renters, this must be discussed with your insurance carrier, because they are covered differently by different companies.
Secure coverage in a timely manner
Insurance is needed from the time you sign a lease, purchase a building or provide a service. If you suffer a loss and have no coverage, no insurance agent will be able to help you. Also, certain laws or leases may require insurance before you are able to start your business activities. Begin discussions with your insurance professional before your sign a lease, buy a building or begin services so you will be prepared with the correct coverage when you are ready to proceed.
Also of importance is to keep your insurance up to date. Only you know when you are changing locations, adding services or purchasing new equipment. Be sure to review your information at renewal time.
Work with an insurance professional who knows your industry
The agent you choose will become an important colleague; in order to select the insurance professional to assist you, consider the following suggestions.
- Each business is unique and requires specially tailored coverage.
- Select an agent who knows the industry and has markets available to meet your needs.
- Do some research so that you will be able to ask the right questions, and be sure you get understandable answers before making a decision.
- Learn what insurance coverage is required by your federal and state regulations and professional organizations, as well as the federal/state/local scope of practice for your particular discipline or service so that you are in compliance with the laws and regulations.
- Ask how long the agency has been providing insurance to the industry. The agency should have a good reputation and be accessible to you by phone or e-mail. All agents should be licensed as required by their particular state and have a nonresident license in your state.