Form BP 08 11: Barbers And Beauticians Professional Liability
1. What the form is
The BP 08 11, Barbers And Beauticians Professional Liability endorsement, is a crucial addition to a Businessowners Policy (BOP) for businesses in the cosmetology and barbering industry. Its primary purpose is to add professional liability coverage, also known as errors and omissions (E&O) insurance. This protects the insured business from claims alleging financial loss due to the rendering or failure to render cosmetic, tonsorial (haircutting and styling), or other related services. Essentially, if a barber or beautician makes a mistake during a service that results in bodily injury or property damage to a client, this endorsement is designed to cover the legal defense costs and any settlements or judgments. It's important to note that this coverage is specifically for the professional services provided and is distinct from general liability coverage, which handles claims like slips and falls on the premises.
2. Classes of business it applies to
This endorsement is specifically designed for businesses and professionals offering barbering and beauty services. This includes, but is not limited to:
- Barber Shops: Businesses primarily offering men's haircuts, shaves, beard trims, and related grooming services.
- Beauty Salons/Hair Salons: Establishments providing a range of services such as hair cutting, styling, coloring, perming, and chemical treatments.
- Nail Salons: Businesses focused on manicures, pedicures, and other nail care services.
- Independent Contractors: Licensed barbers or beauticians who may rent a chair or booth within a larger salon or spa and provide their services.
Real-world examples of scenarios where this coverage would apply include:
- A client suffers chemical burns from a hair dyeing process.
- A customer's hair is severely damaged due to an improperly performed permanent wave.
- A client experiences an allergic reaction to a facial product applied during a service.
- A barber accidentally nicks a client during a shave, leading to an infection and medical expenses.
- A nail technician improperly sanitizes equipment, leading to a customer developing a skin infection.
3. Special considerations
There are several important factors to consider when utilizing the BP 08 11 endorsement:
- Licensing and Certification: Policies typically require that all insured individuals performing services maintain valid state licenses or certifications. Claims arising from services rendered by unlicensed individuals may be denied.
- Scope of Services Covered: While many traditional barbering and beauty services are covered, policies are not standardized, and coverage can vary significantly between insurers. It is crucial to carefully review the policy language to understand which specific services are included and excluded.
- Excluded Services: Certain higher-risk services are often excluded or may require specific additional endorsements and underwriting. These can include services like:
- Tattooing and body piercing
- Permanent makeup application
- Medical or quasi-medical procedures (e.g., Botox, liposuction, dermabrasion, laser treatments)
- Body massage (other than facial or scalp)
- Sun-tanning treatments
- Hair removal from moles or warts
- Products Made by the Insured: Coverage typically does not apply to preparations made by the insured. However, it may cover harm connected to the application of preparations bought at the salon and then used by customers at home.
- Relationship to BP 00 03: The BP 08 11 endorsement modifies the standard Businessowners Coverage Form (BP 00 03). The BP 00 03 provides the foundational property and general liability coverages, while the BP 08 11 specifically adds the professional liability component.
- Occurrence vs. Claims-Made: While some policies may be "occurrence" form (covering incidents that happen during the policy period, regardless of when the claim is filed), it's important to verify this, as professional liability can sometimes be written on a "claims-made" basis, which has different reporting requirements.
Real-world example: A salon owner decides to start offering microblading services without checking if their BP 08 11 covers this specific procedure. A client experiences a severe allergic reaction and scarring. If microblading is an excluded service under their policy, the claim would likely be denied, leaving the salon owner responsible for the damages.
4. Key information for agents and underwriters
Agents and underwriters should pay close attention to the following when dealing with the BP 08 11:
- Risk Assessment:
- Services Offered: A thorough understanding of all services provided by the applicant is critical. Higher-risk services (e.g., chemical peels, advanced skin treatments) will warrant closer scrutiny and potentially higher premiums or specific exclusions.
- Experience and Training: The experience level and training of the operators are key underwriting factors. Newer or less experienced staff may represent a higher risk.
- Sanitation and Safety Protocols: Inquire about the salon's sterilization procedures and overall hygiene practices. Poor practices significantly increase the risk of infections and claims.
- Claims History: A history of frequent or severe professional liability claims is a major red flag.
- Use of Products: Determine if the salon sells or uses any products under its own brand name, as this can create additional product liability exposure that may not be fully covered by this endorsement.
- Pricing: Premiums will vary based on the types of services offered, the number of operators, the salon's location, claims history, and the desired limits of liability. Some insurers may have minimum premiums for this endorsement.
- Coverage Gaps:
- Be aware of services that are commonly excluded and discuss these with the insured to ensure they understand any potential gaps in coverage.
- General liability (often included in the base BOP) will not cover professional errors; this endorsement is essential to fill that gap.
- Consider if other coverages are needed, such as Employment Practices Liability Insurance (EPLI) for claims like wrongful termination or harassment, or Cyber Liability for data breaches.
- Underwriting Guidelines:
- Verify that all operators are properly licensed as required by the state.
- Review the applicant's website and service menus to confirm the types of services being offered.
- For businesses offering services beyond basic hair and nail care, a more detailed underwriting process, potentially including supplemental applications, may be necessary.
- The professional liability limit chosen should be adequate for the potential exposures of the business. This limit is typically part of the overall Businessowners Liability limit.
Real-world example for underwriters: An underwriter receives an application for a salon that lists "advanced skin rejuvenation" among its services. This vague description warrants further investigation. The underwriter should request a detailed list of these services to determine if they fall within the scope of the BP 08 11 or if they involve excluded procedures like laser treatments or deep chemical peels, which might require a separate, specialized policy or be declined.