When you operate a medical spa, it’s crucial to be ready for unexpected incidents that could affect your business. From accidental injury or property damage to lawsuits brought by clients who are dissatisfied with your professional services, there are a number of hazards that could be costly and time-consuming for your business. Purchasing business insurance can protect your business from the financial consequences of a costly lawsuit or accident, giving you peace of mind.

What insurance coverage do I need for my medical spa?

There are many types of insurance coverage to consider, but these policies are particularly relevant to medical spas: 

Professional Liability Insurance

Professional liability insurance is an essential coverage for medical spas, as they perform many sensitive health care and beauty treatments, such as dermal fillers, laser hair removal, Botox, microdermabrasion, and other procedures that could harm clients. If a client is accidentally injured by your services or unhappy with the results of a procedure, you could find yourself dealing with a lengthy, expensive lawsuit—even in situations where you did nothing wrong. Professional liability insurance can provide financial protection if you are sued as a result of alleged failures, negligence, or errors in your professional services.

Example:

• One of your clients suffers dermatological burns and scarring after a laser skin treatment. The client sues, alleging that you were negligent. Your professional liability insurance would cover the lawsuit and any resulting settlement.

General Liability Insurance

General liability insurance is a key coverage type that most businesses must obtain, and it’s especially important for medical spas since they are regularly visited by members of the public. General liability insurance covers incidents of accidental third-party property damage and bodily injury. Accidents such as clients slipping and falling are common and difficult to completely prevent. If you inadvertently damage a client’s property or they suffer an accidental injury on your premises, you could be held liable for damages. In these situations, general liability insurance can step in to cover you for any medical costs, legal fees, or damages in the event of a third-party injury or lawsuit. 

General liability insurance can also include a personal and advertising injury component, which provides coverage for a number of non-physical injuries, including libel, slander, and copyright infringement.

Examples:

• Bodily injury: A client visits your medical spa to receive dermal fillers, and he trips over a lamp cord in your office and falls, breaking his elbow. Your general liability insurance would cover his medical expenses as well as your legal costs if he sues. 
• Personal and advertising injury: Your company publishes a blog about cosmetic treatments. One of the posts makes several disparaging statements that a competitor believes are about their services. The competitor sues you for defamation. Your general liability insurance would cover the lawsuit and any resulting settlements. 

Product Liability Insurance

It’s common for medical spas to recommend and sell products, including skin care and hair care items, cosmetics, and even vitamins or supplements. This creates increased liability for your business—if your products end up causing injury to a customer, you may be sued. Product liability insurance can step in to protect your company against claims of bodily injury or property damage caused by products you sell. Product liability insurance will provide funds to cover your legal fees and any resulting settlements if your company is sued due to damage or injury caused by a product you sold. 

Example:

• Your medical spa carries a line of high SPF sunscreen. When a client purchases the product and uses it, he suffers a severe allergic reaction. If the client sues, your product liability insurance would cover your legal fees and pay any settlement that results.

Commercial Property Insurance

Medical spas rely heavily on their locations and use valuable, specialized equipment and tools. An unexpected disaster that destroys key property can cause a major financial burden for your company, and it could be difficult to recover without the help of commercial property insurance. This coverage can provide funds to replace or repair your business property if it is destroyed or damaged by a covered peril such as fire, explosion, storm, vandalism, and more.

Commercial property insurance covers the following:

• Buildings belonging to or leased by your company
• Contents of the building, including furniture, equipment, and supplies
• Property of others while it is under your care, custody, or control

Example:

• A severe hailstorm damages the roof of your medical spa, causing leaks. Commercial property insurance would pay for repairs. 

Business Interruption Insurance

Medical spas perform specialized services and cannot easily continue working from an alternate location if a disaster damages their property. This is why business interruption insurance is an important coverage for medical spas to consider. Also called business income insurance, this coverage will reimburse your business for lost income and operating expenses if you are forced to temporarily close due to property damage from a covered peril. Commonly covered perils include fire, lightning, windstorm, hail, explosion, and vandalism. Business interruption insurance can be added to your commercial property or business owner’s policy.

Example:

• A short in a refrigerator unit causes a fire to break out in your office. It’s not possible to perform services at your location for a month while repairs take place. Business interruption insurance can cover rent payments, employee salaries, and lost profits while you are unable to operate your business.

Workers’ Compensation Insurance

If employees are injured or fall ill as a result of their work, workers’ compensation insurance will provide financial and medical benefits. Employees of medical spas could suffer a variety of injuries, from repetitive strain injuries to slips and falls, injuries from scissors, needles, or other sharp objects, and exposure to chemicals. 

Workers’ comp will pay for medical expenses, lost income, and rehabilitation for injured workers, and it can also provide death benefits and funds to cover funeral costs in the case of a work-related death. Workers’ comp coverage is legally required for companies with employees in most states, and penalties can be severe if you do not have adequate coverage.

Example:

• One of your employees slips on the stairs and falls, breaking several ribs and requiring medical attention. Workers’ compensation insurance would cover her medical fees and a portion of lost income if she’s unable to work for a time. 

Additional Coverages

• A business owner’s policy (BOP) may be a good choice for qualified small and midsize medical spa businesses. This type of policy combines general liability, property, business income, and extra expense coverage into a single package, helping you acquire a wide range of coverage. The cost of a BOP is typically lower than buying each insurance policy separately.
• Employment practices liability insurance (EPLI) protects your business against lawsuits by prospective, current, or former employees accusing your business of wrongful treatment such as discrimination, harassment, or other employment-related issues.
• Cyber liability insurance covers your business against liability and property losses caused by cyberattacks such as hacks, data breaches, denial of service attacks, and viruses. If your medical spa stores sensitive customer information like health records or credit card information, this may be a prudent coverage to consider.

Pricing and Quotes

Pricing for medical spa insurance will vary based on the type of insurance coverage and the risk profile of your business. Insurers consider factors such as:

• Business size
• Industry
• Location
• Number of employees
• Claims history

Businesses with higher risks will have higher premiums than those deemed lower risk. For example, a medical spa with a history of frequent claims will face higher premiums. Premiums also rise as you increase the limits of insurance. Different insurance companies have different models for rating risks, so it is worth comparing pricing across different insurers.

In order to get an accurate estimate on pricing, it’s best to get a quote from a reputable insurance company. Below we’ve highlighted a few of our trusted partners who offer coverage for medical spas:

Provider	General Liability	Professional Liability	Business Owner's Policy
Embroker	??	??	??
CoverageSmith	??	??	??
CoverWallet	??	??	??
Hiscox	??	??	??
Thimble	??	??	??

Final Word

When you operate a medical spa, you are exposed to serious hazards that could cause major financial difficulties for your business. Accidental client injuries, a disaster that damages your property, or a lawsuit brought by a client unhappy with your services are all potential risks that could devastate your business. Although you can reduce the likelihood of an incident by enforcing good working practices, there’s always a possibility that an accident could occur. This is why it’s important to protect your company with a wide range of business insurance. This coverage can provide financial protection that will enable your business to function normally even after a costly disaster or lawsuit.