According to business forecasts for the cosmetology and beauty industry, the global market for hair salons is expected to expand by 1.54% from now until 2033. The forecast for the nail salon market suggests a higher rate of expansion at 5.44%, and the combined value of the hair and nail salon markets would rise to more than $80 billion. This is good news for estheticians and other professionals in the personal care field; they can count on increased demand for their services, thus increasing business opportunities and income potential.0
If you operat0e in the hair, cosmetology, and personal aesthetics sectors, your career and business outlook are certainly positive. You can start exploring opportunities today, but not without proper insurance coverage. The beauty industry is filled with potential risks that could derail your career and business plans if you are not adequately insured. To this effect, let’s review the three most common reasons estheticians and other beauty professionals should be insured:
Table of Contents
A Matter of Regulatory Compliance
Liability insurance is the most commonly obtained by beauty professionals for licensing purposes. Most jurisdictions across the United States verify proof of business liability insurance before they issue individual cosmetology licenses. This verification is often done again with each license renewal. In states such as Florida and Texas, this requirement extends to commercial establishment licenses; so, if you want to open a small hair salon as a solo stylist, you will need proof of liability insurance for the business and yourself.
You can be a cosmetology business owner and manager without individual licensing; however, the stylists, barbers, cosmetologists, and estheticians at your establishment must be licensed. In this case, you should get liability insurance for the salon, and you may also have to get property insurance for the operating permit.
Dealing With Workplace Accidents and Mishaps
Liability insurance protects you from financial repercussions if someone is injured while providing or receiving beauty treatments. Let’s say you are a nail technician on a house call, and you accidentally lacerate a client’s finger; in this case, liability coverage can help pay for medical expenses, and it can extend to yourself, employees, or clients.
Negligence and incompetence lawsuits are common in the cosmetology industry. When clients file civil complaints and lawsuits because beauty treatments damaged their skin or hair, a liability policy can help cover legal defense costs plus medical expenses.
Product Liability and Business Interruption Situations
One of the most prominent product liability lawsuits filed in 2024 was a case against L’Oreal, Revlon, and other manufacturers of chemical hair relaxers linked to certain cancer conditions. Before the plaintiffs filed the class-action lawsuit, some had filed cases against hair salons and stylists, and the legal expenses from those initial complaints were covered by product liability insurance.
Business interruption insurance helps protect your personal or business income when unforeseen circumstances arise. While damages caused by natural disasters such as storms and earthquakes are usually covered by commercial property insurance, business interruption coverage allows you to continue operating despite the losses. Let’s say a fire damages your salon; in this case, the insurance policy can help you recover lost revenue to cover ongoing business expenses such as rent, utilities, and payroll.