Your salon or spa is a place where clients can go to unwind — the ultimate “treat yourself” destination. But every time you open your doors as an owner, you’re at risk of things going wrong. It’s just the nature of owning a business that interacts with the public!
While you may not want to think about the common risks in a salon or spa business all the time, it’s smart to be aware and eliminate the possibility of risk when you can.
As you read through these example scenarios, go ahead and reflect on your day-to-day operations. Are there any areas where you feel you can strengthen your risk-aversion approach?
Everyday Salon & Spa Risks
Here are some everyday salon and spa scenarios that can lead to costly claims.
1. Slip-and-Fall Accidents
From shampoo suds to essential oil blends, there are many liquid products you and your technicians work with that can potentially spill onto the floor. If these spills aren’t cleaned up immediately, they can cause clients or other third parties to slip, fall, and injure themselves.
Are you located near businesses that serve food and drink? Do you allow clients to bring food and drink into your establishment?
Picture this: a trendy new ice cream shop opens up next to your salon. Your client arrives for her appointment with some family members in tow — one of them enjoying a drippy waffle cone.
You’re too busy to notice the melted ice cream pooling on your reception area floor, and another client makes the mistake of walking through it with low-traction shoes.
One nasty fall and broken wrist later, you’re on the hook to pay for your injured client’s medical bills.
Coverage You Need: General liability insurance
2. Allergic Reactions to Products
Whether you specialize in hair, skin, nails, lashes, or bodywork, you and your technicians work with multiple products as you help clients look and feel their best. These range from chemical developers to infused massage oils.
Multiple clients with varying degrees of sensitivity to a plethora of ingredients creates plenty of opportunity for adverse reactions.
Say you’re welcoming a new massage client for their first session. They mention they’re feeling particularly down because of the cold weather, so you decide to use cinnamon bark oil because of its warming sensation on the skin.
Did you know? Some of the most common essential oil triggers for allergies include:
- Bergamot oil
- Chamomile oil
- Cinnamon bark oil
- Jasmine oil
Your client raves about your service, but a day later, they call to complain about intense contact dermatitis caused by the oil. They had no idea they were allergic — but they can still take legal action against you!
Coverage You Need: Products and completed operations coverage
3. Lapses in Sanitation
One of the biggest salon and spa risks to be mindful of is a lack of proper sanitation. You may have strict procedures in place for disinfecting and sanitizing surfaces and tools, but a simple slip-up can cause clients to contract an infection, illness, or disease.
Here’s a scenario: your nail technicians are dutiful about running all tools through the autoclave after use. But, no one noticed that it was not reaching its intended temperature of 270 degrees because there was still visible steam.
After receiving a manicure from your salon, your client claims that they contracted a viral infection that led to painful swelling and blistering on their fingers. The culprit? Tools that were improperly sanitized.
Coverage You Need: Professional liability insurance
4. Theft of Business Property
According to a recent U.S. Chamber of Commerce survey, 56% of small businesses reported theft — and 53% say that the risk of theft is worsening.
If you sell premium products, use high-quality tools, have electronic equipment, or store cash at your business, thieves could target you as their next victim.
Imagine you’re excited to open for a day of back-to-back appointments only to be greeted by a shattered front door. Your computer, your entertainment system, and all of your inventory stolen.
And of course, without your POS system, you can’t take payments, so you need to put all bookings on hold.
Coverage You Need: Tools and supplies coverage
5. Accidental Fire in Your Rented Space
Another common risk in a salon or spa business? Fire. In 2023, fires in the U.S. caused $23 billion in direct property damage.
Say you’re lighting some lavender-scented candles to create a relaxing atmosphere in your spa. Clients love it — and it helps you get in the zone while you work, too!
But a new staff member who is distributing towels forgets the correct placement. They leave a tall stack of fresh towels too close to a lit candle. When the towels fall over, they catch fire, causing smoke damage to the wall and ceiling.
It was an accident, but your landlord will still hold you responsible for footing the repair bill!
Coverage You Need: Fire legal liability insurance
6. Damage to Client Property
Did you know that once a client leaves your business, you can still be responsible for claims of property damage after the fact? Yep, it happens!
Here’s a scenario: you’ve just perfected the most gorgeous ombre pink on your client’s hair. It’s exactly what they wanted! But as they’re headed home, they get caught in some rain.
Not realizing how damp their hair was, your client sits down on their designer cream-colored sofa, and the pink dye bleeds and stains the surface of their furniture.
Even though you’ve already completed your service, they can sue you for property damage that occurs outside your salon.
Coverage You Need: Products and completed operations coverage
7. Online Promo Blunders
Social media is a great way to stay connected with your clients and promote your business. In fact, 76% of local businesses use these platforms as part of their marketing strategy!
But because it’s so easy to hit “post” and reach an audience of hundreds or thousands, it’s also easy to accidentally share the wrong information.
Say you’ve carefully strategized your upcoming “New Year, New Me” promotion: 20% off all services for the first week of January. You created a Reel to get the word out, but you mistyped the offer amount in the on-screen caption without realizing it.
Now, after a client’s facial and lash extension combo service, they’re demanding a 50% discount — that’s what they saw on Instagram! — and are accusing you of false advertising.
It was an honest mistake, but your client can pursue legal action on the basis of personal injury!
Coverage You Need: Personal and advertising injury coverage
8. Cyber Attacks on Client Data
Nowadays, client management is largely done online — with sensitive information stored in online databases.
You may have excellent security hygiene and focus on protecting your business data, but hackers could be looking bigger picture: a wealth of personal client information conveniently stored in one place!
Picture this: you use a cloud-based booking system, but you miss the notification for a software update with the latest security patches. A cybercriminal exploits this and gains access to all of your clients’ addresses and credit card details.
Not only do your clients lose trust in your business, but some of them decide to bring a suit against you for exposing their data.
Coverage You Need: Cyber liability insurance
9. Client’s Unmet Expectations
Have you ever had a client clearly dislike their results after you completed their services? It’s not the greatest feeling, but with a little honest communication and some zhuzhing, you may be able to get them to leave the chair happy.
But sometimes it doesn’t go so smoothly! Say your client wanted a cool-tone blonde for their upcoming wedding, so you get to work and create a custom color blend. After their hair is cut, colored, and blown out, they say that the color is too orange for their liking — not what they wanted at all.
Claiming emotional distress before their big day, your client decides to blast you on social media and eventually sue you for damages.
Coverage You Need: Professional liability insurance
How to Prevent Injuries in a Beauty Salon
- Prioritize hygiene and sanitation.
- Perform patch tests for products.
- Maintain equipment regularly.
- Ensure staff are properly trained.
- Communicate clearly with clients.
- Follow proper storage practices for products.
Learn about real-life salon insurance claims, plus more tips for risk management.
Insurance for Unforeseen Mishaps
When it comes to managing everyday risks in beauty treatments and beyond, it’s essential to put safety precautions in place. But sometimes accidents are simply unpreventable.
To financially protect the hard work you’ve put into your business, salon and spa insurance is a must-have. Beauty & Bodywork Insurance (BBI) offers excellent-rated coverage at a price that just makes sense. Pay for the number of stations you want to insure and every technician who works them will be automatically covered!
JoAnne Hammer | Program Manager
JoAnne Hammer is the Program Manager for Beauty and Bodywork Insurance. She has held the prestigious Certified Insurance Counselor (CIC) designation since July 2004.
JoAnne understands that starting and operating a business takes a tremendous amount of time, dedication, and financial resources. She believes that insurance is the single best way to protect your investment, business, and personal assets.
JoAnne Hammer is the Program Manager for Beauty and Bodywork Insurance. She has held the prestigious Certified Insurance Counselor (CIC) designation since July 2004.
JoAnne understands that starting and operating a business takes a tremendous amount of time, dedication, and financial resources. She believes that insurance is the single best way to protect your investment, business, and personal assets.
