What Types of Barber Insurance Do You Need?
Every guy relies on their barber for the perfect fade, buzz cut, line-up, crew cut, and every possible haircut. But as a barber, there’s so much more to your day-to-day life than trimming beards and dying hair. You must also interact with customers, keep your shop pristine, and maintain equipment like chairs and clippers. That means having the right insurance policies to cover unexpected barber woes. So, what types of barber insurance do you need? Follow along as we explain why all barbers should have business insurance, which types of policies are most useful, and what to look for in insurance.
Why Barbers Need Business Insurance – Types of Barber Insurance
By “need,” we don’t necessarily mean it’s “mandatory.” The only time barbers need an insurance policy is if the city, state, landlord, or property owner requires it to run a barbering business legally.
But here’s why you should — at the very least — highly consider it:
The Unexpected Can (and Will) Happen
Many new barbers question whether a monthly insurance premium is worth it between high start-up costs, pricey equipment, and employee wages. The short answer to this question is a resounding “Yes!”
- Best-case scenario: You invest in an overarching business owner’s policy (BOP) that you never use. It’s there as a safety net when something unexpectedly goes wrong.
- Worst-case scenario: The policy kicks in and provides coverage when an unhappy customer files a lawsuit. Or you have financial recourse if you become injured on the job or need to replace a damaged chair.
- Worst worst-case scenario (AKA: no policy): A slip-and-fall accident, personal injury claim (i.e., nicks and burns), damaged equipment, or debilitating injury bankrupts your shop or leaves you scrambling for a new career path.
Lawsuits & Damages Can Run You Dry
America is a sue-happy nation with a low bar for filing and over 40 million lawsuits filed yearly. As unfortunate as it is, a client has every right to sue you for an emotionally damaging haircut (odd but true) or severe injury suffered at your shop. Legal defenses alone could cost you upwards of $50,000 out-of-pocket, while a settlement could sink you millions of dollars into debt.
Of course, that’s if you haven’t purchased insurance. The right barber insurance policies could cover the cost of legal fees, stolen or damaged equipment, and income or medical costs if you become injured.
All Barbers Should Consider These Insurance Policies – Types of Barber Insurance
“Barber insurance coverage” sounds extremely vague — because it is. There’s no single type of barber insurance that covers everything under the sun.
Underneath this wide-reaching umbrella is insurance policies like these:
General Liability Insurance
The broadest standalone policy of all — perfect for new shop owners or recent barber school grads — is the classic general liability insurance. General liability coverage covers up to several million when a client files a claim for bodily injury or personal property damage inside your barbershop’s four walls.
These policies come in handy if a client files a claim after:
- Slipping on a wet floor or unswept hair tuft
- Tripping over a blow dryer or clipper cord
- Spraining an ankle on a loose tile
- Dropping products on themselves from a high shelf
- Suffering dyed, stained, bleached, cut, or damaged belongings
General liability insurance will also apply if a client becomes injured simply by being in your barbershop.
Product Liability Insurance
This next type of barber policy shields you from damages truly out of your control — product liability insurance. Many barbershops sell hair care products from major retailers to supplement their revenue. But what happens if these shampoos, conditioners, styling clays, hair removal creams, or beard balms cause injury or damage? Without a product liability insurance policy, you (or your shop) would foot the bill for these claims. Some policies also cover burns, rashes, or allergic reactions from products you apply in-shop.
Professional Barber Liability Insurance
Professional liability insurance — also known as E&O (errors and omissions) or malpractice insurance is ranked high on the list of must-have policies for barbers. Even for barbers with decades of experience and thousands of satisfied clients, honest mistakes are inevitable.
Professional liability insurance would cover legal defenses, settlements, and damages for truly unintentional mishaps, like:
- Getting chemicals or hair in their eye
- Suffering a cut while you buzz their neck
- Incurring a burn from a dryer or chemical burns from hair treatments
- Developing a rash or infection from unsanitized equipment or a nick
- Suffering emotional damage from an incident
The “catch” is that these policies only cover claims and damages caused by negligence (or carelessness), not medical bills or bodily injury like general liability insurance would.
Workers’ Compensation Insurance
Stylists, barbers, and hairdressers are — for the most part — independent contractors (or self-employed). But while the freedom to set your rates and schedule has perks, you also forfeit the luxuries of being an employee. One of the most significant sacrifices is the traditional workers’ compensation policy. If you become injured during your daily shop duties, you’ll pick up the tab for your medical bills and risk the financial loss of each missed workday.
Self-employed workers’ compensation insurance recoups those losses caused by on-the-job accidents or illnesses. That includes burns, slip and fall injuries, respiratory problems from chemical exposure, or infections.
Commercial Property Insurance
Are you a barbershop owner? If so, commercial property insurance will protect your investment and livelihood in the case of an unexpected disaster. Business property insurance covers the physical building — whether you rent or own — and its inventory and equipment.
These policies cover physical repairs, equipment replacements, and lost income in the case of:
- Burst pipes or leaks
- Natural disasters (tornadoes, storms, hurricanes)
- Theft or vandalism
- Lightning strikes
Like all business insurance policies, commercial property insurance only goes so far. So it won’t cover intentional or error-based property damage, like a dye spill that permanently stains the shop floors.
Business Income Insurance
Business income coverage or interruption insurance will cover financial losses resulting from a temporary barbershop shutdown. If you need to close the shop for a few weeks or months to repair a storm-torn wall or replace damaged chairs (for example), these policies will replace the lost income and cover temporary relocation costs.
Commercial Auto Insurance
Commercial auto insurance is a must for shop-less barbers who work on the go. This type of car insurance will cover vehicle repairs and medical bills for collisions while picking up products from a retailer or driving to an off-site appointment.
Business Owner’s Policy (BOP)
We’ll be the first to say it: barber insurance can be extremely confusing, mainly if you haven’t studied all of the insurance industry’s jargon. But there is a way to simplify the entire concept. A business owner’s policy (or BOP) bundles the major business insurances into a single policy — liability, commercial property, and sometimes income. These package deals cover everything from bodily injury and personal damages to theft and natural disasters, making it the most comprehensive policy for barbers and hairstylists. If you choose a single insurance policy for your barbering career, a business owner’s policy is the way to go.
Learn more with this complete guide: Who Needs Self-Employed Business Insurance?
What to Look For In Business Insurance Policies – Types of Barber Insurance
Going the insurance route puts you ahead of the game and gives you a much-needed safety net when worst comes to worst.
Your policy will answer the claims if a customer slips on unswept hair or suffers a scalp burn during a dye job. The same goes for flood damage that slows business for weeks or a break-in that clears out your entire inventory.
But not every insurance agency has your best interest at heart, and it’s easy to fall into the trap of choosing the cheapest policy instead of the best one.
Here’s what to look for in business insurance policies for your barber career:
Affordable Premium Amount
Affordability is the #1 factor worth weighing when choosing any business insurance policy. There’s no sense in short-changing yourself and choosing a policy that doesn’t offer enough coverage to save a few dollars. Yet, your monthly or annual premium shouldn’t significantly cut your profit margins or business growth either.
An “affordable” insurance cost will depend on your estimated payroll and revenue, previous claims, offered services, and geographical location. Before settling on one, we recommend getting barber insurance quotes from several insurance providers.
Covers Everything You Need It To
An insurance policy is only beneficial if it provides ample coverage in the face of a lawsuit, a filed claim, bodily injury, medical costs, lost wages, damages, and more. Think about which types of policies apply to your business. For instance, commercial property insurance would be wise if you live in a tornado alley or a high-crime area. Meanwhile, a mobile barber should invest in a commercial auto insurance policy for peace of mind. The fine print is just as important. An ultra-cheap barber insurance policy that excludes toupees, unexplained inventory losses, or significant appliance breakdowns may not be helpful in some areas. Insurance company underwriters may also inflate premiums if your service line-up includes harsh chemicals that can cause health issues.
Per-Employee Cost (If Applicable)
Do you plan to expand your shop and eventually hire employees? If you answered “yes,” you’ll also need to consider the per-employee barber insurance cost for the business policy. Remember that many states require special policies, such as workers’ compensation for barbershops and hair salons with full-time or part-time employees.
A barber insurance policy may have a $2 million limit for professional and general liability, which is more than enough to handle legal costs and settlements for a well-run and ethical barbershop. However, don’t forget to review the coverage for stolen or damaged equipment and other “smaller” benefits. If your policy only covers $1,000 for equipment damages and costs $2,000 to repair broken mirrors, chairs, and clippers after a storm, you’ll have to cover a decent amount out of pocket.
Want to take your barber business freelance? Check out: How to Set Up a Business as a Freelance Barber
Things to Avoid When Investing in Barber Business Insurance – Types of Barber Insurance
There are also a few red flags that are surprisingly easy to fall for when investing in barber insurance.
Keep an eye out for these two traps:
Ghost policies are incredibly common in the self-employed world, where a shop owner may require you to purchase your own workers’ comp policy. These corner-cutting insurance policies are for solo contractors looking to fill that requirement on paper. Unfortunately, ghost policies don’t provide any legitimate coverage in the case of injury or illness on the clock.
Super Cheap Policies
Unless your state, city, or landlord requires a minimum barber insurance coverage, you can technically purchase the cheapest policies. Unfortunately, the cheaper the policy, the more exclusions it may have and the less coverage it’ll provide. There’s no point in spending $200 a year on a policy that doesn’t cover chemicals, wax, razors, or buzzers.
These policies will not kick in when you need them, and you’ll also be on the hook for settlements, legal defenses, medical costs, and more. Or the policy may not cover everything. For example, the average product liability claim in 2015 was $35,000. A policy with a $10,000 limit on product liability claims would be useless in this scenario.
Conclusion – Types of Barber Insurance
If you consider yourself a small business owner as a barber, you need barber insurance to protect your reputation and income. You may groan at spending 1% of your revenue on insurance costs alone. But without a barbershop insurance policy to step in and protect you, you could lose your business or be forced into bankruptcy.
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