How Much Does Business Insurance Cost For Cosmetologists? 2025 Rates

U.S. personal care and cosmetology businesses can expect to pay between $480 and $840 annually for comprehensive business insurance, averaging $40 to $70 per month. The primary cost drivers are the services offered, business size, location, coverage limits, claims history, and experience level.

How Much Does Personal Care & Cosmetology Insurance Cost?

In the U.S., personal care and cosmetology businesses, like salons and spas, usually pay between $480 and $840 per year for a full business insurance package, or about $40 to $70 per month. But the actual cost can be very different depending on your situation.

Every beauty business has its own risks, so there’s no one-price-fits-all. A small home-based nail tech with no employees will pay much less than a busy salon with multiple stylists and high-end equipment. Things like the services you offer (hair coloring, waxing, facials, etc.), your business size, where you’re located, and how much equipment you have all affect your business insurance cost.

For example, salons in areas with more crime or legal claims may pay more for liability coverage. And a spa with expensive machines and chemicals may pay higher property insurance than a basic haircut-only shop.

Here are some of the biggest cost drivers:

• Number of employees (affects workers’ comp and liability)
• Property size and value (affects commercial property coverage)
• Past claims history (insurers charge more if you’ve filed claims)
• Business interruption coverage and other add-ons

Understanding these variables can help you better estimate your insurance needs and prepare for the real costs of protecting your personal care and cosmetology business.

Average Personal Care & Cosmetology Insurance Costs For Coverage Types

When it comes to protecting your personal care and cosmetology business, different types of insurance cover different risks. Understanding the average cost, coverage details, and what influences pricing for each policy type can help you build a more effective insurance plan. Here’s a closer look at the major coverages most personal care & cosmetology businesses need.

• General liability insurance: $40 per month
• Business owner’s policy: $80 per month
• Workers’ compensation insurance: $61 per month
• Commercial auto insurance: $141 per month
• Professional liability insurance: $54 per month

General Liability Insurance

The average cost of general liability insurance for a personal care and cosmetology business is about $40 per month.

General liability covers third-party bodily injury, property damage, and advertising injuries. For example, in a beauty salon, if a client slips on hair clippings that weren’t swept up quickly and injures their back, general liability insurance would help cover the client’s medical bills and any legal fees if they decide to sue the salon.

Typical policy limits are $1 million per occurrence and $2 million aggregate.

Factors that influence the cost of insurance for personal care and cosmetology businesses include the size of the salon or spa, its location, the number of clients served, past insurance claims, and whether high-risk services like chemical treatments, waxing, or microblading are offered.

Here’s a look at the average annual premiums for 10 different states:

Note: These estimates are based on average annual premiums for personal care and cosmetology businesses from both national carriers and regional insurance agencies. They reflect typical coverage limits for small-to-medium operations offering services like hair, nail, makeup, and basic skincare. Actual premiums will vary by location, services offered (e.g., chemical treatments, microblading), claims history, revenue, staff count, and whether additional coverages (like Professional Liability or a Business Owner’s Policy) are bundled with General Liability.

Business Owner’s Policy (BOP)

The average cost of a business owner’s policy (BOP) is about $80 per month for personal care and cosmetology.

A BOP bundles general liability insurance with commercial property insurance. It protects against customer injuries, property damage, and loss or damage to the equipment. For instance, an electrical fire starts in the back room, damaging hair dryers, styling chairs, and part of the building. The BOP would help pay to repair the salon and replace the damaged equipment.

Typical policy limits are $1 million per occurrence and $2 million aggregate for liability, with separate property coverage limits based on the value insured.

Cost factors include the property value, location risk (such as flood or crime rates), business revenue, number of employees, and any optional endorsements like business interruption insurance.

Here’s a look at the average annual premiums for 10 different states:

Note: These estimates are based on typical Business Owner’s Policy (BOP) pricing observed for personal care and cosmetology businesses (combining general liability and commercial property) and reflect averages across small and larger agencies; actual premiums will vary by services offered, location, payroll/employee count, coverage limits, property value, and claims history

Workers’ Compensation Insurance

The average cost of workers’ compensation insurance for a personal care & cosmetology is around $61 per month.

Workers’ comp covers medical bills, rehabilitation, and lost wages for employees injured on the job. For example, a technician gets a wrist injury from repetitive motion while doing manicures. Workers’ compensation insurance would help pay for their medical treatment, physical therapy, and a portion of their lost wages while they take time off to heal.

Policy limits are regulated by each state, but typically include medical costs and a percentage of lost wages without a set cap.

Premiums are influenced by the size of your payroll, the type of work employees perform, your claims history, and any implemented safety programs.

Here’s a look at the average annual premiums for 10 different states:

Note: These estimates are based on average annual Workers’ Compensation premium patterns for personal care and cosmetology businesses, drawing on typical state rate differentials, common employee classifications (e.g., cosmetologist, esthetician, assistant), and ranges seen across both smaller local agencies and larger national carriers. Actual premiums will vary depending on your business’s payroll size, number of employees, services offered, claims history, and insurer underwriting practices.

Commercial Auto Insurance

The average cost of commercial auto insurance for a personal care and cosmetology business is about $141 per month.

Commercial auto insurance covers vehicles owned or used by the business for accidents, theft, vandalism, or damage. For example, a hair salon owner uses a business-owned car to pick up beauty supplies from a distributor. On the way back, the car is stolen from a parking lot. Commercial auto insurance would help cover the loss of the stolen vehicle.

The cost of commercial auto insurance depends on several factors, such as the coverage limits you choose, the types of coverage included (like collision or comprehensive), the value and number of business vehicles, the driving records of employees allowed to drive them, and whether you add endorsements to cover additional drivers or uses.

Here’s a look at the average annual premiums for 10 different states:

Note: Estimates reflect blended annual commercial auto premiums for personal care and cosmetology businesses that operate small service vehicles (vans, sedans, light trucks) and combine pricing trends from both small and large agencies; they account for regional risk differences, typical vehicle usage for client visits and product runs, and common liability limits. Actual premiums will vary based on fleet size, driving records, coverage selections, and insurer underwriting practices

Professional Liability Insurance

The average cost of professional liability insurance for a personal care and cosmetology business is about $54 per month.

Professional liability insurance helps protect personal care and beauty professionals if a client claims your services caused harm due to a mistake or negligence. For example, a client claims that a facial treatment caused a skin reaction and sues the esthetician. Professional liability insurance would help cover the legal costs and any settlement.

Typical policy limits are $1 million per occurrence and $1 million aggregate.

The cost factors include the type of services you offer, location, experience and training, employee count, and business size.

Here’s a look at the average annual premiums for 10 different states:

Note: These estimates are based on typical annual premiums offered by both small and large insurance agencies and reflect state-level market conditions for personal care and cosmetology businesses. Actual premiums will vary depending on factors such as business size, number of practitioners, claims history, chosen coverage limits, endorsements, and regional underwriting practices.

Personal Care and Cosmetology Business Insurance Costs By Provider

Personal care and cosmetology business insurance costs will vary greatly depending on the insurance carrier. Use the table below to find average costs across different providers.

Note: These estimates are based on average annual premiums for personal care and cosmetology businesses, considering both small and larger agencies and typical coverages such as general liability, professional liability, business owner’s policies, property, and workers’ compensation. Actual premiums will vary depending on services offered, location, number of employees, claims history, and coverage limits.

What Factors Impact Your Personal Care & Cosmetology Business Insurance Costs?

Personal care & cosmetology business insurance premiums are carefully calculated by underwriters based on your business’s risk profile. Factors like the services you offer, your location, the number of clients you serve, your claims history, and even the equipment or products you use all play a role in determining your insurance cost.

Type Of Services Offered

Different beauty services carry different levels of risk. A salon offering basic haircuts and styling will usually pay less than a spa offering chemical peels, laser treatments, or microblading. Riskier services often mean higher insurance costs.

Use Of Chemicals And Tools

If your business uses strong chemicals (like hair dyes or skin treatment products) or expensive equipment (like lasers or facial machines), your insurance premium may be higher. These increase the chance of injuries, allergic reactions, or equipment damage.

Location

If your salon or spa is in an area with high crime, frequent lawsuits, or natural disasters (like floods or storms), your property and liability insurance will likely cost more. A quiet, low-risk neighborhood may help lower your rates.

Size Of Your Business

Larger salons with more employees, treatment rooms, or high customer traffic usually pay more for insurance. More staff means higher workers’ comp costs, and more space and equipment mean higher property coverage.

Value Of Property And Equipment

If your salon has high-end furniture, tools, or machines (like massage chairs, styling stations, or laser equipment), it will cost more to insure. Many businesses add extra protection like equipment breakdown or theft coverage.

Claims History

If you’ve had many insurance claims in the past, like client injuries, allergic reactions, or property damage, insurers may charge you more. A clean claims record can help you get discounts.

Policy Limits And Deductibles

Choosing higher coverage limits gives your business more protection but raises your premium. If you choose a higher deductible (what you pay before insurance kicks in), your monthly cost can go down, but you’ll pay more out of pocket if something happens.

How To Lower Your Personal Care & Cosmetology Insurance Costs

Running a personal care and cosmetology business can be expensive, but your insurance bill doesn’t have to break the bank. While you can’t eliminate the need for coverage, you can take smart steps to reduce your premiums without sacrificing protection. Here are some practical ways to lower your personal care & cosmetology business insurance costs:

1. Bundle Your Policies

One of the easiest ways to save is by bundling multiple policies. Most insurers offer a Business Owner’s Policy (BOP) that combines general liability and property insurance at a lower rate than if you bought them separately. If you also need workers’ compensation, bundling both through the same provider can lead to additional discounts. Not only does this simplify your paperwork, but it also makes your coverage more cost-efficient.

2. Ask About Discounts

Insurance companies often reward businesses that commit to a policy long-term. Ask your provider if they offer multi-year discounts for signing a two- or three-year agreement instead of renewing annually. You might also qualify for lower rates if you pay your premium in full instead of in monthly installments.

3. Implement Safety Measures

Accidents in personal care and cosmetology businesses can be costly for both you and your insurance company. Taking steps to keep your salon or spa safe can help reduce the chance of customer or employee injuries, and may lower your insurance premiums over time. For example, using non-slip mats around shampoo stations, placing wet floor signs after mopping, keeping walkways clear of cords and clutter, and regularly maintaining styling tools and electrical equipment can all reduce your general liability risk.

4. Create A Safe Working Environment

A strong safety program can help lower workers’ compensation costs for personal care and cosmetology businesses. This means training your staff on proper tool handling, sanitizing procedures, safe lifting techniques (like when moving heavy equipment or supply boxes), fire safety, and making sure emergency exits are clearly marked and accessible. When employees know how to work safely, there are fewer accidents and injuries.

5. Adjust Your Deductible

Your deductible is the amount you pay out of pocket before insurance coverage kicks in. Choosing a higher deductible can significantly reduce your monthly premiums. Just make sure you can comfortably cover that amount if a claim arises.

By taking these steps, you not only save money but also make your personal care business a safer, and more resilient business.