What Types of Insurance Does a Tanning Salon Need?

Customers who want to maintain a tan or jumpstart a new one often go to a tanning salon. Many salons offer memberships, encouraging customers to come frequently and consistently. Because salons have frequent visitors, they have several risk exposures and need good insurance coverage to protect them from financial hardships should an incident occur. 

Related: Guide to starting a tanning salon

What Are Some Risks for a Tanning Salon?

Since tanning salons have regular daily customers, they have an increased risk of liabilities. Some of the main risk concerns include the following:

• Failing to provide safe, professional services
• Fire damage
• On-site customer injuries
• Sudden loss of business

Failing to Provide Safe, Professional Services

Training is vital to protect customers from suffering unnecessary injuries on tanning beds. Malfunctioning beds and UV radiation overexposure put customers at risk of severe burns or skin injuries. Mainly, these incidents occur from insufficient employee training and poor customer education on potential dangers.

Other injuries occur from negligence, whether intentional or not. For example, poor cleaning and sanitization procedures put customers at risk of illness or infection. Additionally, improperly diluted cleaning products can also cause illness or skin irritation. Further, spray tanning has risks. For example, the solution may trigger life-threatening allergic reactions, or errors may cause an unwanted outcome. 

Fire Damage

Tanning salons have an increased risk of a building fire, mainly due to the tanning beds and candles used for aromatherapy. A building ill-equipped to handle the electricity draw risks starting a fire. Additionally, overheating tanning beds pose a safety risk to customers, but they can also ignite a fire if flammable objects are too close. Other common fire hazards include faulty wiring, malfunctioning equipment, and smoking.

A tanning salon’s fire load is also a concern. Once a fire begins in a tanning salon, the salon has numerous flammable items that contribute to a damaging, fast-spreading fire. For example, furniture, towels, tanning oils, spray tanners, aerosols, and trash contribute to a heavy fire load.

On-Site Customer Injuries

Aside from tanning equipment injuries, customers also have a general risk of injuries while on the salon’s premises. Like most businesses with on-site patrons, slips, trips, and falls are the primary injury concern. Slippery floors and cluttered walkways contribute to the slip and fall risk. In addition, salons that offer saunas or steam rooms will have an increased risk of slip injuries on wet floors.

Tanning beds that malfunction or overheat are a safety concern as they can cause burns or shock injuries. Also, lacking safety procedures or education on the dangers of UV radiation may lead to skin and eye injury.

Sudden Loss of Business

Tanning salons rely on regular clients to maintain profits, so any loss causing closure or relocation means a loss of clients and revenue. Although much of a tanning salon’s equipment is easily replaceable, finding an adequate location presents challenges. For example, finding a substitute location with the correct electrical requirements may take time and require bringing the building up to code.

What Types of Insurance Should a Tanning Salon Consider?

There’s an insurance policy for just about every risk, so which ones should a tanning salon have? To cover the more significant risks, tanning salons should consider the following policies:

• Professional liability insurance
• Property insurance
• General liability insurance
• Business interruption insurance
• Workers’ compensation insurance

Professional Liability Insurance

Professional liability offers protection for bodily injury or property damage lawsuits that result from errors, negligence, and failing to provide a promised service (i.e., safe and effective tanning). In addition, professional liability covers claims costs such as medical bills, property damage repairs, advertising injury, and legal defense costs.

Unfortunately, an employee’s negligence or lack of training can cause physical harm to clients. As a result, tanning salons benefit from a professional liability policy to protect them from burn injury or skin damage lawsuits.

Commercial Property Insurance

Property insurance covers the tanning salon building and business-owned items (i.e., inventory, furniture, supplies, and the tanning beds themselves) for physical damage or loss. This line of coverage often limits which hazards are covered in the policy. For instance, some of the more common hazards include the following:

• Fire
• Wind 
• Hail
• Vandalism
• Theft
• Water from leaking pipes 

The policy covers both the structure and business-owned items up to an agreed policy limit and usually includes a deductible. The structure’s coverage limit is based on a combined total value, including its size, condition, and customization. Likewise, business-owned items are also covered based on value. However, the insurance policy stipulates whether the items are covered on a replacement cost basis or an actual cash value basis.

General Liability Insurance

A general liability policy for premises and operations covers bodily injury or property damage claims. More specifically, general liability coverage takes care of claims from on-site injuries or injuries from the business’s operations but not from the salon’s professional services, which a professional liability policy covers.

Salon liability insurance is helpful to protect from injury claims resulting from slips and falls. Additionally, if a malfunctioning or overheated tanning bed burns or shocks clients, this liability policy covers the claim, including the following expenses:

• Medical payments
• Property damage repairs
• Legal defense costs
• Judgments
• Settlements

A general liability policy and a professional liability policy have similar coverages. Ideally, both policies should be provided through the same insurance company, removing potential disputes over claim coverage responsibility. 

Business Interruption Insurance

Business interruption insurance offers financial protection when the business unexpectedly closes following a loss. For example, a large building fire that causes a closure or destroys the salon’s equipment means the salon will lose income until it can resume normal operations. During these closures, the business is still required to make payments on loans, rent, bills, and employee wages. 

Fortunately, a business interruption policy covers financial loss while the business’s income has been interrupted. For instance, a business interruption policy covers 

• Lost income
• Employee wages 
• Payment on regular loans and bills
• Costs associated with a temporary relocation

Essentially, a business interruption policy prevents blips in the regular income flow if a loss occurs. This type of coverage is generally offered for 30 days; however, extended coverage (sometimes up to a year) is available through some insurance companies. 

Workers’ Compensation Insurance

A pawn shop with employees will benefit from a workers’ compensation policy because it pays for expenses following an employee’s injury. Without this crucial insurance coverage (which is required in most states), the owner could be held responsible for the medical costs and lost income of the injured employee. 

A workers’ compensation policy offers employees coverage for expenses involving:

• Lost income
• Medical expenses
• Ongoing rehabilitation care
• Disability income
• Court costs
• Funeral expenses

A shop with regular maintenance and cleaning can prevent most injuries. However, if an incident occurs, the workers’ compensation policy covers the employee’s expenses and protects the business from lawsuits.

How Much Does Tanning Insurance Cost?

Each tanning salon will have a customized insurance package meeting its individual needs. For example, a tanning salon that rents space instead of owning it needs far less property insurance coverage than a salon with owned space. Because insurance needs are variable, insurance costs will differ depending on the salon’s specific needs. 

Coverage amounts and risk exposure are two main elements that affect insurance costs. Some of the factors altering coverage amounts and the level of risk exposure include

• The size and condition of business-owned structures
• The number of employees on the payroll
• Employee training or certification
• The condition and quality of tanning equipment
• Customer training and injury prevention
• Any past or current insurance claims or lawsuits

There is a lot of detail that goes into an insurance quote. Still, a good insurance carrier will patiently walk you through it, offering adequate coverage and hopefully a discount or two. Ultimately, the best way to ensure you get the best price for the right amount of coverage is to contact multiple insurance companies for a quote and then compare your options to find the best fit for the tanning salon.