Here are two different scenarios when it comes to salon insurance: For a commission-based salon it is up to the owner to decide their salon’s benefit structure. Each employee that would like to be covered in the group may apply for coverage during the annual enrollment period, or if they are a new hire, they must reach the end of a specified probationary period before the group can cover them.
If the salon is built around an independent contractor (IC) or a self-employed stylist model (SES), it is ultimately up to the stylist to find an individual health insurance policy in the open market.
So which category do you fall under? Are you a salon owner looking into offering insurance to your employees? Or, are you a salon/spa employee looking for insurance options?
SALON TODAY investigated three different salon insurance companies and asked each of them to provide us with information about their businesses and how owners/employees can be covered by heath insurance.
West Bend Mutual Insurance Company offers a special insurance program designed for the cosmetology trade. An “A” rated company by the A.M. Best Company, a full-service credit rating organization dedicated to serving the financial services industries, including the banking and insurance sectors, West Bend will customize a policy to meet a client’s needs.
According to Assistant Vice President NSI P&C Underwriting, Gary Klein, salon owners who are looking for an insurance policy for their salon should work with an insurance agent who ensures they are receiving the three major coverage’s: general liability, professional liability and medical payments with a limit of $5,000 or more.
“With new products coming on the market daily and cultural trends occurring in our society, the cosmetology world is changing quickly. As the industry becomes more complex, typical cookie-cutter policies will no longer adequately protect salons,” says Assistant Vice President NSI P&C Underwriting, Gary Klein. “In the future, I expect to see some insurance carriers retract from this market because they don’t understand, or are fearful of, the changes taking place. Therefore, selecting an insurance company that understands the exposures and needs of the cosmetology trade will become even more important.”
According to M. Shane Miller, President of Sales and Operations of Frances Roberts Salon and Spa Insurance, he believes that owners who provide good benefits, will make their salon look more attractive to new and experienced stylists looking for employment. “People want safety and security now more than ever,” he says. “The parents of the ‘Millennium Generation’ are guiding them to find a salon that offers something other than a training program, fair commission or rental options. They’re being better educated in schools to seek employment that offers a career path, growth systems and benefits.”
Frances Roberts Salon and Spa Insurance covers both self-employed stylists and group insurance for salons and spas. Age, overall health history, location, tobacco use and plan design are all rating factors into the cost of their insurance. On average an individual policy for a female age 25-35 costs $120-180 per month, while a male within the same age range will pay $75-100 per month. Their plans vary state to state, but mostly they recommend the use of a high deductible health care plan that allows the employee, owner or SES the use of a tax advantaged Health Savings Account (HSA). “We want to educate salon owners on the what, how, why and when in regards to health insurance and how it can be integrated in their companies,” says Miller. “At Frances Roberts, we strive for excellence in customer service and education and seek to provide fair and competitive insurance policies and rates.”
Insuranceforsalons.com, is another option owners can consider offering their employees—at no cost to them. This insurance company offers coverage in 45 states and complete coverage is offered seven days later after enrollment. If you are an owner all you have to do is have your staff visit the website, view pricing and enroll themselves. Their plans offer doctor, hospital and emergency needs; discounted rates on dental, chiropractor, vision, vitamins, diabetic supplies; accident and injury coverage; and discounts on prescription drugs. This plan also allows your employees access to over 500,000 practitioners and 5,000 hospitals around the U.S.
For more information on these insurance companies, visit their websites:
West Bend Mutual Insurance Company: Thesilverlining.com
Frances Roberts Salon and Spa Insurance: Francesroberts.com