Whether you are just beginning your career as an esthetician or if you are an established professional with years of experience, one question is always in the back of your mind. Is my business protected?
When we refer to the protection of your business, we do not mean protecting your equipment or the building where the spa is located. Of course, it is important as well – but that is a topic for another blog post. In fact, we are referring to a different kind of business protection – protecting your business from the financial consequences of a lawsuit.
Your business is built around lending your services and expertise to your clients. As an esthetician, you handle and use chemicals, wax and sometimes lasers on clients. A simple error whether made by you or insisted upon by a client can lead to devastating results.
Skin burns, eye damage, and scarring are the tip of the iceberg when it comes to your exposures as an esthetician.
This blog post will explore the answer to the questions:
– What are my risks as an esthetician?
– How do I protect myself and my business from a lawsuit?
– What is professional liability insurance?
– And finally, importantly Why do I need esthetician’s professional liability insurance?
To answer these questions, first, let’s take a deeper look at your exposures as an esthetician.
What are my risks as an esthetician?
When you treat someone as an esthetician, whether you do a chemical peel or a waxing treatment, you have your customer’s health in your hands. That’s why the fallout from a mistake or a procedure that went wrong, is much more significant and financially painful for you than that of an office professional for example.
There are two types of estheticians that provide their clients with invaluable services: a salon esthetician and a medical esthetician. A salon esthetician works in a spa or a salon and offers cosmetic services such as skin care services, waxes, treatments, etc. Medical estheticians, on the other hand, work in a medical office or a hospital and are more clinical focused. Their services focus on providing care for patients with post-surgery skin trauma or patients that experience trauma due to illness or accident such as burn trauma or cancer.
Some of the main exposures that you face as a salon esthetician are :
– a chemical peel treatment that results in chemical burns on client’s sensitive skin
– an allergic reaction to a product used during a treatment
– a wax burn that occurred as a result of tender skin
As a medical esthetician, your risks are higher than those of your salon counterpart, since you work with harsher, more potent acids, other chemicals and some procedures that involve laser treatments. Some of the examples of the risks that a medical esthetician faces are –
– a skin rejuvenation treatment has gone wrong
– a laser procedure caused severe skin burns
– a varicose vein treatment caused skin damage
How do I protect myself and my business from a lawsuit?
No matter how good you are at what you do and how careful you are when it comes to the procedures and treatments, you are bound to make a mistake at some point. Maybe you are distracted by a personal issue, lose track of time and leave a product on the client’s skin for too long. Or maybe you have not noticed a client’s tender skin and performed a waxing procedure causing a skin burn. These are only two examples of many very real situations that could and do happen to estheticians all over the world.
After all, you are only human, and errors happen. Sometimes they are not even your fault!
Let’s take the example of a waxing burn. Imagine that the client insisted on finishing the treatment against your recommendation. The skin was tender, and of course, the treatment caused a burn. Even though you recommended to stop the procedure the client could still come after you.
In the end, all these exposures result in an exhausting and financially draining lawsuit.
So how do you protect yourself from that?
Well, unfortunately, no product or service in the world will guarantee that nobody will sue you. However, professional liability insurance will protect you from the financial fallout from such a lawsuit.
What is a professional liability policy and what does it cover?
As the name suggests, a professional liability policy (otherwise known as a malpractice policy), is designed to cover your actions in a professional capacity as a licensed esthetician.
The primary limit of the policy, usually a $1M or a $2M of coverage, will cover the court fees, the cost to investigate and fight the allegations as well as the attorney fees. It will also cover any settlements your attorney reaches with the plaintiff or any judgments against you awarded in the court of law.
We also need to point out that the coverage will kick in whether or not you are found guilty. Even if the lawsuit ends up being a frivolous lawsuit, you will still need to hire a lawyer to fight for you. This cost alone can add up to hundreds of thousands of dollars.
The difference between General Liability and Professional Liability insurance
When someone talks to you about a liability policy, it’s important to verify which policy they are referring to. The two most common liability policies in the insurance world are a general liability policy and a professional liability policy.
We have already discussed what a professional liability policy covers. Let’s talk very briefly about how it is different from a general liability policy.
A general liability insurance coverage is designed to cover you from accidents resulting from a premises liability such a slipping on a wet floor or getting hit by the door as you are walking in. Many think that a general liability policy will also cover you for professional exposures – it will not. In fact, it specifically excludes your work as a licensed professional.
Why do I need a professional liability policy?
A profession of an esthetician, while rewarding, is also inherently risky. You see many clients on a day to day basis. Some clients have sensitive skin, some clients are allergic to certain ingredients found in the products you use, and some are just not happy with the result. No matter the reason, whether merited or not, an esthetician’s business is a lawsuit waiting to happen.
Imagine that you have just been served the summons. Can you afford to hire a lawyer? What about the settlement that is likely to be reached? Or worse, a judgment awarded against you, including punitive damages?
You start your business intending on thriving, helping customers and making your dreams come true. How can you do that if you are forced to file a bankruptcy, lose your home or other assets or even have to give up a portion of your future earnings to defend yourself from a lawsuit?
You need to purchase a professional liability policy to protect yourself and your business from the worst-case scenarios.
Sure, nobody likes to add an extra monthly expense they have to pay, least of all an insurance premium. However, when you think of it, what better use for your money than protecting your current and future lifestyle? Could you afford to really not be covered?
Since we are discussing why you need a professional liability policy, we would be remiss in failing to mention the following – why it’s important to have your own professional liability policy instead of relaxing on the policy of the spa you work in.
Do I need my own professional liability policy?
In general, it’s always recommended to purchase your own professional liability policy. This is the only way that you can ensure that correct coverages are purchased, the policy is in effect, and all the facets of your business are covered.
However, it is always beneficial to understand the coverages that you have (or don’t have) through the spa, salon or a medical office you work at.
– Treatments performed outside of the spa – any treatments performed outside of the spa and not on behalf of the spa will likely be excluded on the salon policy. If you consider taking any clients on the side (and let’s face it these sometimes are your best clients), it’s essential to have your own policy to avoid an uncovered claim.
– Individual coverage – Depending on how the policy is worded, it might not be providing coverage to any individuals named separately in the suit. In other words, the policy only covers the entity itself. So, if an esthetician is named as the defendant in the lawsuit along with the spa she works at, the esthetician might be responsible for her own representation and a share of a settlement.
– The scope of coverage – Is every treatment that you provide covered by the policy? It often happens that insurance is taken out by the owner, but as the business grows and more services are added, the insurance is not updated. Understanding what treatments, the business’s professional policy covers can be the difference between a covered or uncovered claim.
As you can see, a professional liability policy is a critical component of your overall financial health as you embark on the exciting career as an esthetician.
From chemical burns to allergic reactions to laser treatments gone wrong, the chances of something not going as planned are high. You hold your customers’ health in your hands and mistakes happen. Nobody can protect you from a lawsuit. In fact, 1 in 3 estheticians gets sued.
However, a professional liability policy can help you weather the storm by providing coverage in case a lawsuit happens.
Esthetician Professional liability insurance is an essential tool that you can use if the worst happens. Bizinsure can provide you with instant quotes as well as human support on the other side of the screen (or the phone!). Click here to complete a short online form to receive your quotes instantly.