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Member Question from Maya: What is the best home-based insurance to get?
55 Plays11 months ago
In episode 11 of the Beauty of Style podcast, hosted by Greg Robins and brought to you by the BeautyCouncil, we delve into an essential topic for home-based beauty professionals: insurance. Our first member question episode features a query from Maya, a listener from the Sunshine Coast, seeking clarity on insurance for her home-based business.
Understanding Insurance Basics
Insurance is a safety net, covering unexpected events like injuries, damages, or lawsuits. While home insurance protects your personal assets and liability, it doesn't extend to professional activities conducted at home.
Why Home Insurance Isn't Enough
Your home insurance is tailored for residential use, covering scenarios like theft or property damage. However, it doesn't cover professional liabilities or accidents that occur during business activities.
The Need for Specific Professional Insurance
For home-based beauty professionals, having a separate professional insurance policy is crucial. This policy should encompass:
- General Liability: Protects against accidents on your premises, like a client slipping on stairs.
- Professional Liability: Covers incidents directly related to the beauty services you provide, such as a client suffering an infection from a treatment.
Additional Coverage Considerations
Consider insurance for your equipment and supplies, especially for high-value items. Be transparent with your insurance agent about the services you offer and any changes to ensure comprehensive coverage.
Choosing the Right Insurance Provider
The Beauty Council recommends trusted providers like Apollo or Zensurance, who understand the unique needs of the beauty industry.
Key Takeaways for Beauty Professionals
- Separate your professional activities from your home insurance.
- Ensure comprehensive coverage for both general and professional liabilities.
- Regularly update your insurance policy to reflect changes in your services.
Insurance is not just about protecting your business; it's about ensuring peace of mind for you and your clients. Listen to the full episode for more insights and tips on securing the right insurance for your home-based beauty business.
Recommended
Transcript
Introduction and Purpose
00:00:00
Speaker
Welcome to the 11th episode of the beauty of style podcast brought to you by the beauty council. I'm your host, Greg Robbins. And today we have a special episode with a member question at the beauty council. We help members solve their problems and connect them with professionals in our hand-picked network. So with that, let's jump into our first member question episode.
Question: Insurance for Home-Based Business
00:00:30
Speaker
Maya here from the Sunshine Coast. Thank you so much for your podcast. I just love it. Anyways, I have a question for you around insurance because I'm not really sure how it works when it comes to working in your own home. So I have a home-based business and I have home insurance and I have liability and all that. But I'm looking into professional insurance so that I'm properly covered. Can you give me some ideas or give us some ideas?
00:00:59
Speaker
as to how we should go about getting the proper insurance so we're covered and we can stay out of trouble. Thanks so much. Looking forward to your reply.
00:01:09
Speaker
Hey Maya from the Sunshine Coast, thank you so much for your question. Love the Sunshine Coast, it's just a beautiful place. Gotta love Ruby Lake in the summertime, if you can. Anyone listening, get up there, jump in, it's beautiful, it's really nice. So your question around insurance, you are not alone. So many of our members call us around a number of things.
Understanding Insurance Basics
00:01:31
Speaker
especially around insurance and health plans but insurance is something that we get a lot of questions around I think is generally misunderstood so great question glad you asked it so let's just really quickly talk about what insurance is in the first place insurance is something that you buy right just like for your car or anything else and it means if someone is injured while you're working on them
00:01:55
Speaker
or somebody decides to sue you for some reason because they don't like your work or something happened, insurance will cover you. If you are not insured, you have no coverage. That means if something breaks or someone gets injured or you get sued, you're on your own. That means you have to pay for everything yourself.
00:02:14
Speaker
So that's what insurance is in the big picture.
Home vs. Business Insurance
00:02:17
Speaker
So around your question, will insurance that you have for your home cover you in a home-based business? The short answer is no. So the reason you have home insurance is specific to
00:02:30
Speaker
the reason that you live in your home. So why do you live in your home? You need a place to live, it's a roof over your head, it's where you sleep at night. And so you buy insurance to cover and protect that part of your asset, right? So you're essentially covering it so if it burns down, they'll put you in a hotel.
00:02:49
Speaker
If it gets struck by lightning or something, they'll fix whatever gets damaged. If a tree falls on the roof, they fix that too. The other thing home insurance usually covers are things like theft. So if someone breaks into your house and steals your stuff, they will replace it. It can also extend out to stuff like your bikes,
00:03:07
Speaker
or things like in your shed, that sort of stuff. Home insurance also comes very often with a liability policy, meaning that if you somehow, something goes wrong and someone gets injured and they sue you, very often your home insurance will protect you. Now you gotta check your policy to be sure about that.
00:03:24
Speaker
But for example, if you don't shovel your driveway properly and somebody's walking down, they slip and fall and bonk their head, they could take you to court and try and sue you for damages, in which case you're gonna need a lawyer. And if the judge awards damages to the person that gets injured, you will have to pay those. If you're not insured, all of that has to come out of your own
Importance of Separate Policies
00:03:45
Speaker
pocket. So that's home insurance. Now the thing is, home insurance is designed specifically for residents living in a home
00:03:54
Speaker
for the purposes of residential use only, that's it. If you're running a professional business out of your home, anybody for that matter, then you need specific insurance to cover you for the things that happen in your professional life. Your home insurance will not cover it and the reason is is because that's not what they're designed to do. When you sign that contract,
00:04:17
Speaker
for your home insurance, you would have just said, I live there, I sleep there, I eat there, that's what I do there. And the insurance company says, great, we're gonna cover you for those things only and nothing else. If you walked in and said, gosh, somebody wants to sue me because I botched their,
00:04:34
Speaker
whatever, their permanent makeup or I burnt their scalp, the insurance company would say, well, you're not covered for that. You're actually not supposed to be doing that sort of thing in your house according to our policy. So you're not covered. So you would be left high and dry. So we've teamed up with a number of insurance companies that can provide you in your home with specific home insurance. And by that,
00:04:58
Speaker
That means coverage that is designed exclusively for nothing other than professional use.
Types of Liability Coverage
00:05:04
Speaker
So that's a separate policy, you pay for it separately, and there are two sort of general aspects to that, insurance. One is called general liability, and then there's professional liability. So the first one is general liability.
00:05:19
Speaker
General liability means if let's say a client walks in, they start walking down your steps. There happens to be a banana peel for some reason on the steps because a child left it there or the railing is loose and they fall down the stairs and let's say they break their arm. Just making up an assumption here. This is just something I'm making up as I go along.
00:05:40
Speaker
They break their arm, but their job actually requires them to use their arm. Maybe your client is a nurse or a doctor or something and she needs her arm to work. So she's going to have to take time off work and suffer what's called a loss. In other words, she won't be able to work and earn money. So she will likely sue you for those losses. In other words, I can't work for six months. That means I'm out $40,000. I'm going to sue you for $40,000.
00:06:06
Speaker
It could be much worse, there could be a head injury or something. So that's general liability. So that usually extends to your premises as it relates to things around your house, let's say your stairs, a slippery floor, maybe hot scalding water in the bathroom, stuff like that. So that's what the general part is. The second piece of the insurance is called professional.
00:06:31
Speaker
Professional insurance relates exclusively to the type of work that you do as a beauty professional on your client. And the reason it's separated is because anybody can slip on a banana peel, anybody can burn their hands on hot scalding water in your bathroom, but only people that you're performing professional beauty services on or grooming services on are going to be injured by those particular services. And those are called professional services or professional liability to cover that.
00:06:59
Speaker
In that case, let's say you are performing a service on the individual, you nick them and you cause a little infection, they go off, maybe they don't treat it, that infection becomes quite serious, turns into something bad and they suffered three weeks in the hospital with some sort of nasty infection or the contract hepatitis or something bad happens.
00:07:22
Speaker
In that case, you could be sued as well because that person would suffer losses in some way, shape, or form. Maybe they couldn't go to work. You know, they had distress as a result. It caused another complication. You name it. So in that case, they would sue you, but that would fall under what's called the professional liability coverage because that particular
00:07:44
Speaker
incident or you know like the effect on the client happened only as a result of the professional services that you were providing them. So that's what that part is.
Business Equipment Coverage
00:07:55
Speaker
There's a third component and even more components your adjuster can know or sorry your insurance agent can always give you recommendations and advice
00:08:02
Speaker
There are things, for example, for coverage of your supplies and your equipment. So let's say someone breaks into your house, walks past all your jewelry, all your gold, and goes straight for your high priced equipment, maybe steals a laser machine, maybe makes off with a $1,000 pair of shears. In that case, a good insurance policy for professional use will cover those losses as well.
00:08:27
Speaker
Now, it gets quite complicated because maybe you do a wedding on a weekend. Maybe you do your neighbor, but not at your house. You take your stuff over to their place and you're no longer in your physical space that you put on the policy. So it's really, really important.
Ensuring Transparency with Agents
00:08:44
Speaker
We always say it's super important to tell your insurance agent exactly how you run your business. Don't hide anything. Don't pretend you don't do something. If you are offering a service today,
00:08:57
Speaker
and then offer another service tomorrow. Make sure you call your agent and tell them that you've included this new service in your lineup. They may or may not adjust your premiums. It could adjust, it could go up, it could go down, it just depends. But what you do not want to be is sitting in court one day and your agent looking over at you and say, I just wish you told me you did that because I would have added it to your policy and you would have been covered. But now I can't cover you.
00:09:22
Speaker
because you didn't tell me, so I don't know. So this is typically the way things unfold in court, and you want to be covered. Trust me, this is where you want to be entirely, you want to sleep well at night, you want to be entirely covered, and you want to have all of that in place. Not only do you want it, but at the end of the day, you know, your clients want it as well.
00:09:43
Speaker
Now if I were going to go and get a service somewhere and there was even a minimal risk of injury to me, I would want my service provider completely covered and here's why.
Building Client Trust with Insurance
00:09:54
Speaker
Because if I chose to sue or make a claim against the provider,
00:10:01
Speaker
Knowing that there's an insurance company standing behind that provider to pay out makes me very comfortable. Thinking that I am going to either ruin their lives or empty their bank account or have them declare bankruptcy because they can't afford to pay me and then I get nothing, that makes me nervous.
00:10:19
Speaker
So that's why you see a lot of trucks driving around for plumbers and electricians that say fully insured and bonded. That means that you know what, if they make something go wrong, they are covered by insurance and you will get your payout if need be. So it works both ways. It protects you and it protects your clients. So I hope that answers your question. Thank you so much for being our very, very first caller and super excited about it.
00:10:44
Speaker
And if you have any other questions as a member, please call
Recommended Insurance Providers
00:10:48
Speaker
in. We're more than happy to connect you with one of our two providers, Apollo or Zen Insurance. They both know the business really well. They'll fix you up with what you need. We recommend them, and they are available to all of our members. Thanks so much.
Listener Engagement and Feedback
00:11:30
Speaker
Got a question you'd like to have answered? It's easy. Just email a voice recording to info at beautycouncil.ca and keep listening to the Business of Style podcast.