Are you are a hairstylist or other beauty professional? If you rent a booth, then you need a special type of insurance called booth renters’ insurance.
This guide is going to explain exactly what booth rental insurance is. We will go over why it is important, what types of coverages there are, and factors that might affect your costs.
What is Booth Renters’ Insurance?
Some beauty professionals own independent businesses but do not work in salons they own. Instead, they rent a booth (chair) at an established salon owned by another party.
The owner of the salon no doubt has their own insurance policies to protect their business. But those policies do not extend to you, even though you are working at their establishment.
As that is the case, you need to get your own insurance coverage to protect your business. That is what booth renters’ insurance is for.
You might need booth rental insurance if you work as any of the following:
Basically, if you are any type of beauty professional who rents a booth, you need this type of insurance coverage.
What are the Legal Requirements for Booth Rental Insurance?
Most states do not require that you purchase commercial insurance as a booth renter, unless you happen to have employees. If you do, it is legally required that you purchase workers’ compensation.
That being said, most establishments will require you to purchase booth rental insurance before they will allow you to work on the premises.
The exact requirements will vary from one establishment to the next, so you will need to ask the minimum requirements for the business where you want to rent a booth to know what you will need.
Generally, you can expect to have to purchase general liability insurance. Some businesses may have additional requirements as well.
Reasons Why You Need Booth Insurance Coverage
Here are some of the main reasons to purchase booth renter’s insurance:
- Expand your work opportunities. As we just discussed above, you might have to carry a booth rental insurance policy in order to be eligible to work at a lot of salons. So, by taking out a policy, you give yourself a wider selection of establishments where you can offer your services.
- Protect your business. Another important reason to have booth rental insurance is to safeguard your business financials. If you find yourself responsible for medical costs or property damage costs, your policy can help you cover those payments. In some cases, this may prevent your business from capsizing entirely.
- Keep your business running smoothly. Property damage or other issues that lead to interruptions in your business can cost you more money in the form of lost income. But with certain types of coverages, you can offset some of those potential losses and/or repair or replace your equipment to get back up and running as quickly as possible.
- Maintain your relationships with other business owners. Consider a situation where, for example, you accidentally damage the property of the business where you are renting a booth. If you have insurance, it will help you to quickly cover the cost of the damages. This may allow you to maintain good relations with the business and continue to work there. If you do not have insurance, however, you may struggle to pay for the costs, which could harm your relationship with the business owner.
- Protect your reputation. In general, businesses that carry insurance policies are seen to be operating more responsibly and professionally than those that do not. So, if you let others know you are insured, it makes a good impression. This should have a positive impact on your business all around.
Types of Booth Renters’ Insurance
There are a number of different types of booth renters’ insurance policies. Let’s go over some of the most common types now.
- General liability insurance: If you will be getting just one type of booth rental insurance to cover your business, you should make it general liability insurance. This type of policy is sometimes called “slip and fall” coverage. That is because it can pay out when accidents occur, causing someone else to get hurt or have damage to their property. This coverage can also cover damages related to slander or libel.
- Errors and omissions insurance: This type of insurance is also called professional liability insurance, and is among the most popular types of booth rental insurance after general liability insurance. It covers you if a client sues you for issues relating to negligence or what they feel was poor professional advice. This type of coverage might kick in if, for example, you were confident that a customer was not allergic to a particular product, but you were wrong, and they suffered a reaction as a result.
- Commercial property insurance: General liability insurance pays out if another person’s property is damaged during the course of your work. But it does not pay out of it is your property that is damaged. For that, you have to purchase another type of policy called commercial property insurance.
- Equipment breakdown insurance: What if the equipment you use every day to perform your job stops working? There is a specific type of policy you can purchase to pay out in situations like this, called equipment breakdown insurance.
- Business interruption insurance: Sometimes equipment breakdown or another issue could cause a disruption in your business. Maybe, for instance, water damage in the building where you work means that you cannot work for a few days while repairs are being made. Business interruption insurance can help to cover the income you lose through these types of disruptions.
- Product liability insurance: This is a specific type of policy for covering product-related liabilities—like the allergy-related example we provided earlier. It should be part of errors and omissions insurance, but you might be able to purchase a separate policy or extend your coverage to include a higher amount of product liability insurance.
- Stolen/damaged equipment insurance: If any of the equipment you need to perform your work is stolen or damaged, you can cover it with this type of insurance. Note that this is not the same thing as the type of coverage you need for equipment breaking down. Make sure you have both.
- Rental damage insurance: What if you somehow damage the chair you are renting or the area around it? You will be liable for the damages. You can get help covering them if a rental damage insurance policy pays out.
- Cyber liability insurance: If you accept payments directly from customers, you may want to purchase this type of coverage to protect their electronic information. That way, if you are hacked or there is a data breach, you have some protection for your business.
These are just some of the most common types of booth rental insurance. Depending on the nature of your business, you might have to take out additional types of policies as well to fully protect your business.
How Much Does Booth Rental Insurance Cost?
We have seen cost estimates for booth rental insurance that range from under $10 a month to more than $40 a month.
How much it costs to get booth renters’ insurance depends on a variety of factors.
Let’s go over them now.
- Which booth renters’ insurance coverage options you select. Not every professional is going to need every type of policy. Some people who rent a booth might only decide to purchase general liability insurance, and perhaps errors and omissions insurance and some form of coverage for their equipment. Others might decide to buy all the types of coverages we listed above, or even other types that are not listed here. The more types of coverages you purchase, the more expensive your insurance costs will be.
- Coverage amounts. The higher the amount of coverage you select for a policy, the more expensive that policy will be. You could purchase the minimum that is required of you to work at the establishment where you will be renting the booth, or you could purchase a higher amount. Just be aware that if you do, your monthly costs will rise.
- Deductibles. Before an insurance policy will pay out, you have to meet the deductible. This amount has to be paid out of pocket. The higher the deductible, the more money you have to pay before your insurance company pays—but the lower your monthly insurance costs will be. Raising your deductible entails risk, but it is a way to decrease your ongoing costs.
- The nature of your business. The cost to insure a hairstylist or barber business may be different from the cost to insure a manicurist or pedicurist business. These may differ from the cost to insure an esthetician business, and so on. The type of work you do and the equipment you need to cover may raise or lower your insurance price compared to what someone else might have to pay who is working in the booth next to you.
- Where you work. The location where you work could have an impact on the cost of your booth rental insurance. Details involving the establishment itself as well as its geographical area could be relevant in determining pricing. For example, if you work in an area where theft is common, it could cost more to insure your equipment.
- Discounts. Insurance carriers typically offer a range of different types of discounts, some of which you may be qualified to claim. One common example is the discount which you might receive for bundling together more than one insurance policy from a single carrier. When you are requesting quotes, be sure to ask about the kinds of discounts that are available for booth rental insurance.
- Your carrier. Insurance companies use underwriting guidelines to decide which customers to insure and how much to charge for their policies. Those underwriting guidelines are different for each carrier. So, you choice of carrier also will impact your booth renter’s insurance costs, even with all other factors being equal.
There may be other factors that influence the costs for booth rental insurance as well. You can go over these in detail with the insurance experts you speak to as you are evaluating different plans.
Where to Get Booth Rental Insurance?
Now you know more about getting cosmetology liability insurance, hair stylist liability insurance, and other types of booth renters’ insurance.
If you are ready to get the coverage you need to protect your business while renting a booth, click any of the links below to compare quotes from top carriers.