Here's what most salon and spa owners don't realize until it's too late: one slip on a wet floor can cost you everything. A client trips over a hair dryer cord, breaks their ankle, and suddenly you're facing a lawsuit that could drain your savings and shutter your business. That's where general liability insurance comes in. It's not just another expense on your overhead list—it's the shield that protects your dream from turning into a financial nightmare.
Whether you're running a boutique hair salon, a full-service day spa, or a nail studio, general liability insurance covers the accidents that happen in your space—bodily injuries when someone gets hurt and property damage when you or your staff accidentally break something valuable. The good news? It's more affordable than you think, and it's often the only thing standing between you and a bankruptcy-level lawsuit.
What General Liability Actually Covers in Your Salon
General liability insurance handles two main categories of claims: bodily injury and property damage. Let's get specific about what that means in a salon or spa setting.
Bodily injury coverage kicks in when someone gets hurt on your premises. The most common scenario? Slip-and-fall accidents. A client walks to the shampoo bowl, doesn't notice the wet tile, and goes down hard. These claims are surprisingly frequent in salons where water, hair products, and smooth floors create the perfect storm. In 2025, a real salon in Texas faced a claim when a client tripped over a hair dryer cord left stretched across the walkway and broke her foot. That claim cost $911. Another salon in Georgia dealt with a $51,958 payout when a perm rod slipped during treatment and struck a client's eye, requiring medical attention.
Property damage coverage protects you when you accidentally damage someone else's belongings. Think about all the expensive items your clients bring into your salon—designer handbags, smartphones, laptops, leather jackets. Water from the shampoo station ruins an iPhone. Spilled acetone stains a client's $800 purse. A misplaced curling iron burns a leather jacket. These aren't hypothetical scenarios—they're real claims that salons file regularly. One facialist doing an in-home treatment accidentally knocked over a client's laptop and needed insurance to cover the replacement cost.
Your general liability policy also covers legal defense costs, which can pile up fast even if you win the case. If a client sues you claiming they were injured in your salon, your insurance pays for attorneys, court fees, and settlements up to your policy limits. This is critical because legal defense alone can cost tens of thousands of dollars, even for frivolous lawsuits.
Standard Coverage Limits and What They Mean
The industry standard for salon and spa general liability is $1 million per occurrence and $2 million aggregate. Here's what those numbers actually mean in plain English.
Per occurrence means your insurance will pay up to $1 million for any single incident. If a client slips and breaks their wrist, and the medical bills plus lawsuit total $75,000, your insurance covers it. If that same incident somehow results in $1.2 million in damages, your insurance pays the first $1 million and you're on the hook for the remaining $200,000.
Aggregate means the total amount your insurance will pay for all claims during your policy period, which is usually one year. If you have three separate incidents in a year that cost $800,000, $600,000, and $700,000, you've hit $2.1 million total. Your insurance pays the first $2 million, and you pay the remaining $100,000 out of pocket.
Most landlords require exactly these limits—$1 million per occurrence and $2 million aggregate—before they'll hand over the keys to your retail space. Banks often require the same coverage for SBA loans. Premium clients and shopping centers sometimes require higher limits, especially medical spas which often carry $1 million per claim and $3 million aggregate for professional liability on top of their general liability coverage.
What General Liability Doesn't Cover
This is important: general liability does not cover professional mistakes with your actual services. If you burn a client's scalp with bleach that's too strong, or they have an allergic reaction to a facial product, or you cut their ear with scissors during a haircut—those are professional liability claims, not general liability claims. You need a separate professional liability policy (also called errors and omissions insurance) to cover service-related injuries.
General liability also doesn't cover your own equipment or inventory. If someone breaks into your salon and steals your styling chairs and product inventory, that's a commercial property insurance claim. If your building catches fire and destroys everything inside, general liability won't help you—you need property coverage for that. And if an employee gets hurt on the job, that's workers' compensation, which is legally required in most states once you have employees.
How Much You'll Actually Pay
General liability insurance for salons is surprisingly affordable. The national average in 2026 is about $67 per month, which works out to around $800 annually. But plenty of salon owners pay less. Thirty-five percent of personal care businesses pay under $30 per month for general liability, and 79% pay less than $60 monthly. Some specialized insurance providers offer salon coverage starting as low as $31 per month.
Your actual premium depends on several factors. Medical spas typically pay more—around $52 monthly—because they offer higher-risk services like injectables and laser treatments. Basic hair salons and styling professionals average closer to $35 per month. Location matters too. If you're in California or New York, expect to pay about $75 to $78 monthly compared to the $67 national average, partly because lawsuit settlements tend to be higher in those states.
Other factors that affect your rate include your claims history (previous lawsuits drive up premiums), your location's crime rate, how many employees you have, the value of equipment you use, and how many harsh chemicals you work with daily. Salons that do a lot of chemical services like color, perms, and keratin treatments typically pay slightly more than a simple blowout bar.
Why You Need Proof of Insurance
General liability isn't legally required by the government, but it's practically required by everyone you do business with. Your landlord will demand a certificate of insurance before approving your lease, and that certificate needs to list them as an Additional Insured. This means if a client sues both you and the property owner over an accident in your salon, your insurance protects both parties.
Banks require proof of insurance for business loans, especially SBA loans. They want to know their investment is protected if something goes wrong. Premium retail partners and salon suite landlords won't sign contracts without seeing proof of coverage, often demanding limits above the standard $2 million. And if you're bidding on corporate contracts—like providing salon services at a resort or spa—you'll need insurance to even get in the door.
Getting Started with Coverage
Shopping for general liability insurance is straightforward. Start by gathering basic information about your business: your annual revenue, number of employees, square footage of your space, types of services you offer, and whether you work with any particularly high-risk treatments. Most insurers can quote you within minutes once they have these details.
Many salon owners bundle general liability with other coverage types in a Business Owner's Policy (BOP), which typically includes general liability, commercial property insurance, and business interruption coverage for one discounted premium. A complete BOP for a salon averages around $99 monthly. If you have employees, you'll also need workers' compensation insurance, which is legally required in most states. A full insurance package covering general liability, property, professional liability, and workers' comp runs about $2,900 annually for a salon with two employees.
Don't wait until you sign a lease or land a big client to get covered. Insurance companies can issue policies quickly, but you don't want to be scrambling at the last minute. Get quotes from multiple providers who specialize in salon insurance—they understand your specific risks better than general business insurers and often offer better rates. Once you're covered, keep your certificate of insurance handy and update your Additional Insured endorsements whenever you sign new contracts or move locations.
