Tips For New Salon Owners
Q: I am leasing some tanning units and the leasing company requires proof of insurance. Can I get coverage for the leased equipment?
A: Yes, but you will need to cover all aspects of your business. You cannot, and should not, just cover the leased equipment. Some other areas to explore include tenant improvement and betterment (TIB), replacement cost and underinsured insurance.
Q: The salon that I bought has computer timers on all the equipment, so I really don't need professional liability.
A: Yes, you definitely need professional liability insurance. Computer timers are excellent but they are only a small part of protecting you from legal defense costs and damages. Clients sue for a variety of reasons such as cracked shields, allergic reactions and photosensitivity. The cost of legal defense alone could be more than the cost of a professional liability policy.
Q. I haven't chosen my salon location yet. What will make a difference?
A: Location makes a big difference. Some salon owners don't realize that when renting in a strip center, there is a considerable difference in premium depending on the construction and age of the building, as well as if it is equipped with fire sprinklers and/or an alarm. How the property is maintained also is an important point. For example, a leaky roof could cause considerable damage and down time resulting in claims. Additionally, there are many areas of the country--such as coastal properties--that are more difficult to insure.
It is equally important to be aware of any lease nuances. Many salon owners are responsible for tenant improvements, signs and glass. Read your lease and discuss these exposures with your insurance agent. Be prepared to provide the name and address of the landlord, as well as any leasing companies that need to be listed on your policy.
Q: Other salon owners have told me that they don't have insurance. Is this a wise choice?
A: Many new salon owners don't understand the need for insurance. With so much to be done before opening a tanning salon, many salon owners push the issue of insurance to the bottom of their to-do list rather than the front.
The upfront investment in a salon is considerable and includes buying or leasing equipment, tenant improvements at the location, decorating, purchasing lotions and other products, just to name a few. Factor into that the legal aspect of signing a lease and the responsibility for customers coming to the business and providing a specialized service such as tanning and you've got an equation for a business headache.
Q: Is there any benefit to becoming a certified tanning professional?
A: Yes! Training programs for operators make a difference in any insurance premium. The quality of the staff and professional certification sets your salon above others, so it is important to choose your insurance carrier wisely.
Universal's program is underwritten by the American International Group (AIG), one of the world's largest commercial insurance and financial services organizations, and is rated A++ (Superior) by A.M. Best Company.
If you have any questions regarding insurance coverage or policies, feel free to contact Universal Insurance Facilities Ltd. c/o Amy Brown, P.O. Box 40079, Phoenix, AZ 85057-0079 or e-mail questions to abrown@vpico.com. For a quick, free, no-obligation quote, call (800) 844-2101.
