Hair & Beauty Salon Insurance (2025)

Accidents can happen in any hair or beauty salon, like client injuries, property damage, or expensive equipment breakdowns. Business insurance helps cover these unexpected costs, saving you from paying out of pocket. With the right coverage, you can focus on your clients and keep your salon running smoothly, no matter what.

Why Do Hair & Beauty Salon Owners Need Insurance?

As a hair or beauty salon owner, you know how important it is to create a safe and professional space for your clients. But even with the best care, accidents can still happen, and without insurance, one small mistake could lead to major costs.

Imagine a client slipping on a wet floor or having an allergic reaction to a product. Or what if a hot tool accidentally burns a customer or damages their belongings? Without proper insurance, you could be left paying out of pocket for medical bills, repairs, or even legal fees.

Insurance acts as a financial safety net, protecting your salon from claims involving bodily injury, property damage, or lawsuits. It helps keep your business running, even when the unexpected happens.

It also builds trust with clients. Many people feel more comfortable knowing their stylist or therapist is insured, it’s a sign of professionalism and responsibility.

What Insurance Do Hair & Beauty Salons Need?

Running a hair or beauty salon involves more risk than many people realize. You’re working closely with clients, using sharp tools, heated equipment, and chemical products, all in a fast-paced environment where accidents can happen. To protect yourself and your business, here’s a breakdown of the most important insurance policies to consider.

General Liability Insurance

What it is: This is the foundational insurance policy for most small businesses. It protects you from third-party claims of bodily injury, property damage, and personal injury.

What it covers: If you accidentally damage a client’s property or someone gets hurt because of your work, general liability pays for legal fees, repairs, or medical bills.

Example: A stylist accidentally knocks over a client’s designer handbag while blow-drying their hair, spilling product all over it. The client demands reimbursement. General liability insurance can cover the cost of replacing the handbag and any legal fees if a lawsuit follows.

Workers’ Compensation Insurance

What it is: This policy covers your employees if they get injured or become ill as a result of their job.

What it covers: Medical bills, lost wages, rehabilitation, and even death benefits. It’s also required by law in most states if you have employees.

Example: One of your salon assistants slips on a wet floor while cleaning up after a treatment and breaks their wrist. Workers’ compensation insurance covers their emergency room visit and helps pay for lost wages while they recover and take time off work.

Workers’ compensation insurance is required for hair and beauty salons with employees in almost every state.

Commercial Auto Insurance

What it is: If you or your employees drive for business purposes, personal auto insurance likely won’t cover accidents. Commercial auto fills that gap.

What it covers: Vehicle damage, injuries, and liability if you’re involved in an accident while driving for work.

Example: One of your salon employees rear-ends another car while driving the company van to a client’s home for an on-site bridal hair and makeup appointment. Commercial auto insurance covers the repair costs for both vehicles and any medical expenses related to the accident.

Hair & Beauty Salons pay an average of $140 per month, or $1,680 per year, for commercial auto insurance.

Business Owner’s Policy (BOP)

What it is: A BOP bundles general liability and commercial property insurance into one policy, often at a lower cost than buying them separately.

What it covers: Property damage to your business location or equipment, along with liability protection.

Example: A fire breaks out in your salon, damaging styling tools, hair products, and important business records like client appointments and payroll files. A business owner’s policy (BOP) helps cover the cost of replacing the damaged equipment and recovering lost income, helping you get your salon back up and running.

Cyber Liability Insurance

What it is: This covers losses related to cyberattacks, data breaches, and other digital risks, particularly important if you store client info online.

What it covers: Legal costs, notification expenses, and credit monitoring for affected clients.

Example: Your salon’s scheduling software is hacked, and sensitive client information like addresses and payment details are leaked. Cyber liability insurance helps cover the costs of managing the breach, including notifying clients, legal fees, and restoring your reputation.

Professional Liability Insurance

What it is: This insurance protects your salon if a client says you made a mistake during a treatment or service that caused them harm or loss.

What it covers: It helps pay for legal fees, settlements, or damages if a client sues you because they’re unhappy with a service, like a bad haircut, allergic reaction, or skin irritation.

Example: If a client claims they had an allergic reaction to a product you used during a facial and decides to take legal action, professional liability insurance helps cover the cost of defending your salon and any settlements you might owe.

Together, these policies form a comprehensive insurance plan for hair & beauty salon businesses. While not every business needs all of them, understanding your risks and matching them with the right coverage ensures your operation stays protected, whether you’re a small salon owner or manage a growing team.

Hair & Beauty Salon Insurance Requirements

Hair and beauty salons may not have federal laws that require specific insurance, but state and local rules can vary depending on where you operate and how your business runs.

Workers’ Compensation Insurance: In most states, if your salon has employees, you must carry workers’ comp insurance. This covers medical bills and lost wages if someone gets hurt or sick from work. Some states don’t require this for most private businesses, but it’s still a smart idea to protect your team and your salon.

Commercial Auto Insurance: If your salon owns vehicles used for business, like a van for mobile services, most states require commercial auto insurance. In some states, this coverage is mandatory for business vehicles.

General Liability Insurance: This insurance isn’t legally required but is often needed to win contracts and protect your salon. It covers claims if someone is hurt or their property is damaged while at your salon. Many landlords and clients ask for proof of this insurance before working with you.

Professional Liability Insurance: Also called Errors & Omissions insurance, this protects your salon if a client claims you made a mistake during a service, like a bad haircut, allergic reaction, or skin irritation. It helps cover legal fees and any settlements if you are sued.

Always check with your local city or county offices to find out the exact rules and insurance needs for your salon’s location.

How Much Does Hair & Beauty Salon Insurance Cost?

Insurance costs for hair and beauty salons can vary widely, depending on the size and type of your business. On average, general liability insurance may cost between $1000 and $1,700 per year, with solo salon owners or booth renters usually paying on the lower end of that range.

If you run a larger salon with multiple employees, offer specialized services, or own expensive equipment, your insurance needs will be greater, meaning your annual premiums could exceed $1,500, especially if you add coverage like workers’ compensation, professional liability, or commercial property insurance.

Several factors affect your business insurance cost, including: your business location, number of employees, types of services you offer (e.g., basic cuts vs. chemical treatments or skincare), and claims history.

While it may be tempting to go with the cheapest option, it’s important to choose a plan that truly protects your business from its most likely risks.

How Is Your Hair & Beauty Salon Insurance Cost Calculated?

Insurance companies look at several things to figure out how much your salon insurance will cost. These are based on the unique risks of your business.

One of the biggest factors is how big your salon is. If you’re a solo stylist, you’ll usually pay less than someone who owns a full salon with several employees.

The services you offer also matter. If your salon does higher-risk treatments, like chemical peels, hair bleaching, or laser services, your insurance rate may be higher compared to basic cuts and styling.

Where your salon is located makes a difference too. Insurance costs can change depending on your state, city, or even ZIP code.

Other things that affect the cost include: value of your tools and equipment, the type and amount of coverage you choose, business structure (like LLC or sole proprietor).

Each of these details helps insurance companies decide how much risk they’re taking, and how much you’ll pay. The better they understand your salon’s setup, the more accurately they can price your policy.

Tips To Lower Your Hair & Beauty Salon Insurance Costs

Insurance costs can add up quickly for a hair & beauty salon, but there are practical ways to keep your premiums manageable without skimping on coverage. The key is to understand which factors you can control and take proactive steps to minimize risk.

• Bundle your policies. Combine general liability, property insurance, and other coverages into a business owner’s policy (BOP) to qualify for a multi-policy discount.
• Consider Hired And Non-Owned Auto (HNOA) Coverage. If you or your employees use personal vehicles for work, HNOA can be more cost-effective than a full commercial auto policy.
• Keep A Clean Claims History. Avoiding claims through proper training and safety procedures can lower your risk profile and lead to reduced premiums over time.
• Invest In Workplace Safety. Implementing safety protocols and training for employees helps reduce the chances of injury claims and can lower workers’ compensation costs.
• Raise Your Deductible. Opting for a higher deductible can lower your monthly premium, but be sure your business can absorb the extra out-of-pocket cost in case of a claim.
• Review Your Coverage Annually. Adjust your policies as your business evolves to avoid paying for coverage you no longer need.
• Compare Quotes From Multiple Insurers. Rates vary widely, so shopping through Insuranceopedia can help you find the best deal for your current needs.

Taking a strategic approach to your insurance planning can make a real difference in your bottom line. With a little research and regular review, you can stay protected and cost-efficient at the same time.

Following these steps helps ensure you’re properly insured and set up to handle risks confidently and professionally.