How to protect your beauty business against rising insurance costs
The beauty industry has seen a significant rise in the cost of insurance premiums over the past few years and there are several reasons for this – an increase in the number of aesthetic-type treatments being carried out, the un-regulation of those treatments leading to unqualified or inexperienced staff carrying out those treatments, and a huge increase in claims.
The traditional beauty salon is fast disappearing in terms of the type of treatments being offered to clients. Not many businesses can now compete just by offering standard treatments like nails, waxing and facials.
To make an impact and profit, more salons are turning to high value offerings such as laser-based treatments, IPL and fat reduction. Although these treatments can be hugely profitable, they leave the salon open to more things going wrong and the level of professionalism and care to the client increases significantly.
Although change is coming, as it needs to, the proper legal requirements for staff carrying out these treatments has not been in place and this has led to inexperienced and unqualified people carrying out invasive and potentially dangerous procedures on clients.
This in turn has led to a huge increase in claims and has seen the insurance companies look to protect against these by raising premiums and making certain treatments extra add-ons to policies.
This had led to the no win no fee solicitors looking at the beauty industry as an easy target and moving forward, I think we will see more of these firms advertising and promoting their services to clients visiting our salons and clinics. Some have even set-up dedicated departments that deal exclusively with claims against businesses within our sector.
But, how do we go about trying to lessen the impact on our businesses individually?
There are several measures you can take to ensure you protect yourself, not only from rising premiums but also from claims being made against you:
- Ensure staff are fully trained for the treatments they carry out, that their knowledge is up to date, and that they are fully qualified not to just the current legal requirements but also to any future legislation changes
- Make sure all your machinery and equipment is regularly serviced and that you keep up-to-date logs of usage. You should also record the machine serial numbers
- Ensure your premises are fully secure and that you carry out regular assessments in terms of health and safety and fire responsibilities
- Deal with client issues promptly and try to come to a swift resolution. If possible, get this recorded in writing with a client signature
- Ensure your consultation process is watertight as it is one of the most important parts of a client’s treatment. You should carry a consultation out every single time and make sure the client signs to confirm the answers they have given, stating that they are happy to have the treatment. A lot of salon software companies are starting to include a consultation process in their systems.
- Shop around. Don’t be afraid to switch insurance providers as you need to ensure you get the best deal for you and your business. Having a blanket insurance policy often means you’re not covered properly or as well as you think. Most good insurance companies can build a bespoke policy these days.
Paul Beatty is managing director of Beauty and Man at the Gate in Holton-Le-Clay, which won the 2018 North East Large Salon of the Year Professional Beauty Regional Award.