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Water and Other Slippery Slopes
Written by: Susan Preston
Day Spas in America are doing well. They are able to combine services and offer the busy woman or man more than one option for their beauty treatments. This industry has turned out to be somewhat recession proof as one of the last expenses people give up are services or products that make them feel better about themselves.
The day spa industry has become more sophisticated over the last few years. Along with an increase in the amount of services a day spa offers goes an increase in potential liability. While a small beauty salon that mainly cuts hair and maybe has one manicurist might not have much liability, a larger facility with tanning units, saunas, lasers, permanent cosmetics, massage and Brazilian waxing will have more liability. The exposures have changed over the last few years along with what people are suing for. A day spa should never be without liability insurance as many have been caught by surprise by what they are being accused of.
If the day spa has a water source, there is a potential for claims as it is amazing how klutzy Americans are. If there is water on the floor, people are likely to trip and fall, and a lawsuit is likely to ensue. This includes in showers, pools and coming in and out of saunas and steam rooms. We recently saw a risk where a woman had died sitting in a hot tub when the manager “forgot” about her. The insurance company paid hundreds of thousands of dollars in the settlement. We have had doors slam on clients coming out of steam rooms. In one case an Achilles heel was broken. Not good. Spas with water sources need high limits of liability.
Brazilian waxing procedures have become popular and increasingly requested. This has given rise to a new category of claims – communicable disease. Many people who get this procedure are likely to have acquired the disease from some other source which most of us can imagine. However that won’t stop the lawsuits from coming. Often the waxing procedure will make the symptoms worse, which is why the claimant assumes they did not have the disease from another source. In a lawsuit, they often can’t prove the waxing lead to the communicable disease, but by then the spa is already out thousands of dollars in legal fees. It is recommended spas get communicable disease insurance to cover the costs of the legal fees arising from this type of situation. More insurers are making this coverage available.
Another source of communicable disease claims is from manicures and pedicures. A fungal infection is a communicable disease, so if the insurance policy excludes it, there will be no coverage. This is one of the biggest exposures a nail salon will have.
In our stressed out society, massage services have represented a tremendous growth opportunity over the past few years. Most of us enjoy a nice hour massage to relax our muscles and relieve stress. This is a wonderful thing except that it increasingly leads to allegations of sexual abuse. Historically this would be from a man working on a woman, but those days are gone. We see claims from woman to woman, woman to man and man to man. The only way around this is to buy insurance for these sorts of instances. Again it is often difficult to prove the allegations, but that does not stop the lawsuits. If there is no insurance for this type of allegation, the spa owner will have to hire an attorney at hundreds of dollars/hour to help them defend themselves.
One of the big advantages of having insurance for these kinds of things is that the burden is on the insurance company to find an attorney who can assist the individual business owner if they are sued. Attorneys who work for insurance companies are often better able to help than random attorneys because they have some experience in the particular class of business – in this case general or professional liability for spas. Also the business owner then does not have to come up with an upfront retainer.
If the person doing the waxing procedure or the massage service is an independent contractor, they might or might not get sued. The entity who almost always gets sued is the business name on the door. Stating the person who did the service is an independent contractor is rarely a defense in law. The spa owner should either insure the independents or require they have their own insurance and name the spa as additional insured. The problem with separate insurance is it should include endorsements such as communicable disease and sexual abuse and many independent contractor policies won’t offer those coverages.
Adequate insurance for these items is usually not expensive so avoid the slippery slope of self insuring these critical exposures.