Exclusions Apply: What Your Liability Insurance Won't Cover (Part 2)

Are you covered for selling at-home hair color or facial kits? Or for a client who refuses to wear PPE? How do we make clients feel safe when salons reopen? Get the answers in Part 2 of our conversation about professional liability insurance with Tracy Donley, the Executive Director of Associated Skin Care Professionals.

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Edited for length and clarity.

EPISODE TRANSCRIPT

JAIME: Welcome back to part two of our series with Tracy Donley of Associated Professionals. In part one, we covered some of the must-know basics about protecting your business and yourself with insurance. If you haven’t listened already, make sure you listen to part one first.

ASHLEY: There’s some great info in part one, and in part two we get into even more detail. Let’s grow together. 

ASHLEY: So as far as most liability insurance policies especially right now I know there’s a bit of a scramble happening with reopening and the different phases of reopening and the recommendations that are coming down from either local health boards or state boards. Your state suggests that everyone wear masks single use capes things like that. A client declines the PPE during their service. What implications does that have for us as service providers and also insureds, and obviously there’s a right to refuse service applicable here, but what coverages could we potentially expect if we do go forward with the service?

TRACY: Since we do not specifically if someone were to contract a disease as a result of saying that they refusing PPE, it wouldn’t be covered regardless. I would just underline the fact that you need to be a professional, and if that means refusing the service to that client, that’s what you have to do. I mean, lives are at stake, you know, I wish that I could get a wax, even though I just used some Ret-A, you know, this is more than that.

JAIME: Because the consequences are so much greater possibly with contracting a communicable disease, if a client signs a waiver or a consent form, does that somehow absolve you from any liability that a family might hold you to after the fact, if for example someone were to be seriously injured or worst possible case they die?

TRACY: I think when in doubt, make sure people are signing things, document what you’re talking about. But like I had mentioned earlier, there’s just never a golden ticket.

ASHLEY: Yeah. That makes sense. I mean, it’s so funny what we see in the Facebook groups and what’s being discussed and the reluctance on behalf of some clients and on behalf of some beauty providers saying, Oh, if that’s what it takes, that I’m not gonna do that, as if that’s a choice. It is a choice. It’s the wrong one.

TRACY: Yeah, it is definitely a choice and, and I think it’s going to be interesting too because getting some of the guidelines from the states, and we’ve been working closely with Colorado here as well as some of the other ones. They’re going to be the bare minimum. They’re going to be the bare minimum of what they expect you to do. And I can tell you from us, even, you know, sharing our ideas and thoughts with the different states. We would expect our members to go far beyond what the states are going to advise people to do. So I think people really need to take their best interests in mind, their families, their clients, cause if it’s just kind of spinning the wheel to see what you get and working in the hopes that you just get lucky and you don’t have to invest in additional means to secure yourself and your clients. I think that’s not a game anybody should really be playing.

JAIME: We’ve talked a lot about state board. To clarify, for the most part, insurance is not a requirement of operating your business unless somehow perhaps your salon owner requires it of you if you’re renting or your landlord who’s leasing you the space requires it of you. Are there efforts being made to make it a requirement, and what do those look like?

TRACY: It is a requirement for the majority of the 50 states as it relates to massage therapy. They are required to have professional liability insurance. Unfortunately, we don’t have a collective group that represents the entire country the way that the massage community does.  Of course we feel that everybody should have insurance. There are a few states that do require it for esthetics as well as cosmetology, but it’s an effort that we would love to try to organize. It’s just, it’s very difficult. It’s been, it’s a daunting task. Let’s just say that.

ASHLEY: Aside from not having adequate insurance, what’s the biggest mistake you see businesses making?

TRACY: Ooh, that’s a good question. I would probably say, definitely though, not having adequate insurances is heart wrenching. When someone comes up to you and tells you their story and you think, wow, you’ve spent so much money on so many other aspects of your business and now you haven’t even protected it and you’re being sued for hundreds of thousands of dollars. I think the other one is probably just documentation, intakes, having thorough communication, really truly realizing that what the services that you’re providing is more than just a feel good service. So you need to be looking at the way that you’re noting what services your clients have been partaking in, and what the results of the services have been. I think it’s really important and that can definitely cover you if something were to happen. The other thing I think that all beauty and wellness practitioners especially as sole practitioners and independent contract workers need to be doing more would definitely be retail sales. I can’t say it enough and if this hasn’t been eyeopening with everything that’s happening with the COVID-19 pandemic is retail sales and how important it is because that can keep you afloat when you can’t be face to face with your clients. It’s so important, especially in skincare and hair care as well, that you’re having proper at-home care. Taking and using professional products to make sure that whatever services you are getting when you were in the treatment room are being maintained at home. So I think the most successful practitioners are going to be the ones who really do grasp retail sales as a big part of what they do.

JAIME: If businesses are expanding their retail sales to include products that are marketed as sanitizers or disinfectants and yet they may not have the appropriate approvals from either the EPA or FDA, does that not put you at risk again with your liability? 

TRACY: Yeah, I think so. And the other thing too is I don’t see a need for any professional, why would a professional be selling a disinfectant or sanitizer? 

JAIME: You haven’t been seeing the same posts I have, Tracy.

TRACY: No, probably not. I think if they’re recommending a product that’s a professional product that has nothing to do with their license. Do you see what I’m saying? For a situation with a manicurist, unless you could share with me, I’m not sure why someone would be recommending a disinfectant or sanitizing product.

JAIME: Much in the same way they would be recommending a product to cure fungal toenails.

ASHLEY: Yes, and even a disinfectant type product that is sprayed on the body.

TRACY: I think in those situations, that’s more of a backbar professional product and the way that I would kind of equate that is that your insurance wouldn’t cover you if you were to sell a chemical peel solution to your client for them to do at home because it’s a backbar product. It’s only for professional use. Same thing is, even too, with a hair dye. You wouldn’t sell backbar hair dye to your client for professional use. It needs to be at-home type products.

ASHLEY: I might need you to repeat that because it seems like a root touch-up kit or, something along those lines like an in between sort of solution that’s not designed for at-home use, professional color coming from your color station, premixed and handed in a no contact handoff to a potential client or to a current client, that’s something that would fall under an exclusion? 

TRACY: Yes. So if something were to occur, they would not be covered for that. So if the client had a reaction to their scalp, they would not be covered. And so if the hairstylist was sued, that would be at their own expense.

JAIME: And we don’t control what our clients do or how they use the product so if they were even to get something on their skin that wasn’t meant to go on their skin or in their eye. I could just see endless possibilities for risk.

TRACY: Yeah, so let’s tell a silly story. Let’s say you said, oh, this new bottle of champagne, pink nail polish is gorgeous. You should buy that. It would be great for you, and then your client buys it and it’s something that you retail in your spa or in your salon, and then the client ends up pouring it all over their legs and spills it, they wouldn’t have a case basically, because they were not using it for its intended use. So if you’re basically saying, okay, here’s this antifungal toenail solution and they are start spraying it on their body versus on their toenail and something bad happens, that’s on them.

ASHLEY: I can even see that extending from, I’ve made a root touch-up kit for my client. They take it home, they apply it, and then they also decide that they want to do their eyebrows at the same time, drips into the eye. You have a much bigger situation and, I think that’s definitely not a bridge too far. 

TRACY: But still creating a root touch-up kit that isn’t packaged for consumers and it’s tapping into whatever your backbar supplies are. That is a no-no. You should not do that.

JAIME: So much of what we do depends on manufacturer instructions and if we were creating those kits, we’re not even supplying the labeling that comes with it.

TRACY: Yeah. So the key to look for is, if any bottles or packaging have for professional use only, they better not be in the hands of your clients.

ASHLEY: I love that because that just makes it very easy to understand and I can already hear this episode rocketing around the Facebook groups. 

TRACY: Oh gosh. 

ASHLEY: But in a, in a great way. 

JAIME: Isn’t that the way though that manufacturers protect themselves against claims is that they’re putting on their labels, this is for professional use only. It must be used according to our instructions no matter how ridiculous those instructions seem to some. They have their own product liability issues.

TRACY: Absolutely, and that’s the other thing too. I mean, when you get into a product liability claim, they’re going to go after the product manufacturer as well so like I said before they’re going to look for all the different people to name in the suit as possible so you’re exactly right, Jaime. That’s exactly how they protect themselves.

ASHLEY: As the professional, the way that you protect yourself from that scenario and even remove yourself from that scenario would be to use your products according to the manufacturer’s instructions and no other way. Correct? 

TRACY: Yes. Every time. Yes, yes, yes. 

ASHLEY: What advice would you offer to clients now coming back into a salon setting and wanting to receive a beauty treatment, what onus is on the client end of things with regard to liability and protecting themselves?

TRACY: Well, I think, you know, every time it’s important to do your research, right? And I’m, I’m in this industry, but I’m also a consumer of these services as well. When I go back, which I’m very excited to go back when I do, I am dying for all you amazing artists and people out there.  But I definitely feel like I want to know, I want to feel 100% confident that they have done their work and they’re going above and beyond and I want them to communicate that to me in various ways. I want my pre appointment, my pre-check in, to be more than, hey, it’s your appointment on this day. Just a reminder. See you soon. I want it to be very specific of what I can expect when I get to my appointment. We’ve talked about what those client check-in protocols look like, but I want to know what that’s going to look like and I want to know why they’re doing what they’re doing. I also want them to check in with me. I think even a followup call just to see how I felt during the service would be great too, even if maybe it’s on a phone call, maybe it’s an email or something, but not a survey. I just want to feel that I’m a person that they’ve been thinking about and that’s why they’re taking all these precautions. Not just a paycheck, and they need me desperately, even though I understand. I get it. They may, but I need to just feel like I can trust them.

JAIME: Your enthusiasm for the services should give everyone some encouragement that we’re ready to be welcomed back as long as we’re doing what it takes to protect ourselves as service providers and our clients.

TRACY: Yeah, absolutely. And I can’t say it enough. I can’t wait to see you guys.

ASHLEY: We can’t wait to get back into our businesses as well, but of course we want to do it the right way. We want to do it safely for everyone involved and just with lots of information. So if someone’s listening to this and, they’re not entirely sure about what they should do job one,  what would be some of your recommendations for just checking in with where they stand with their insurance? What riders they might need to add and ways that they can kind of beef up their own safety?

TRACY: Now is the perfect time to really review everything, right? Make sure that your policy is current. Read your policy. Take a look at it. See what it is covering. Find out how much does it cover. Is it covering two million? Is it one million? What does it look like? Do you have enough coverage? Do you know, does your coverage mean that you, if something were to happen, that you do have a deductible? What does that deductible look like? Is that affordable to you? Because I know that there’s a lot of policies, including ours that doesn’t have any deductible whatsoever. I also think that this is a great time to actually even do a safety check beyond I know we’re thinking about just cleaning and disinfecting and just getting all the things in place to make everybody feel happy and safe moving into the new normal or whatever we’re calling it now, but a safety check right now is a great time to do that. So, what does that mean? That means go round and check and maintain your workspace. Inspect your tables or anything that supports your clients. You guys would be shocked on how many incidences and claims we’ve had for people falling off of broken tables, or like screws were loose and the tables collapsed. Or even to mag lamps, the glass falling out and cutting the orbital bone. So really check all your equipment, steamers spraying scalding water on people and burning them. Also too, I would encourage you to just look around and keep your floor, clean up potential hazards or obstacles.   I know you’re probably looking at your counters right now, thinking, okay, let’s declutter. It’s less to clean, but look at your floors too, make sure that that’s sparse and clear as well. Some people also don’t even know how to use a fire extinguisher. So I would say, maintain your fire extinguishers. Make sure that they’re not expired. They have these little labels on them. Check that. Make sure you know how to use your fire extinguisher. I know everyone knows this, but clean up spills immediately and I know you guys will keep doing that. We’ve been talking so much about keeping good files and records on your clients. Go back and look through them. Are they organized? Could you find something if you needed to, if something were to come up on one of your clients? Those are a few things. We also do mention that this is a good time to just check all your heat sources. Make sure all the cords are in good condition. There’s nothing that got ran over by the vacuum cleaner a couple times that looks a little shifty. Yeah. Those are just a few things.  

JAIME: I have a question about the products themselves. We know that OSHA covers workers, and in workplaces where they’re employees, but do you recommend that members also create for themselves, even if they are working alone, the same types of resources that OSHA would recommend or actually they require it, of workplaces, for example, the binder of safety data sheets?

TRACY: 100% I mean I think any time that you are creating something that is methodical like that, I think that you’re more likely to follow it. You’re holding yourself accountable. I think it’s a great idea. And then I think if something, God forbid a claim did happen, that’s another piece that you can say, but look these are all my protocols that I follow.

ASHLEY: That’s such a great point because protocols will definitely be changing moving forward knowing that we’ll have to spend more time to tear down and disinfect our stations and just the extra time that being even more cautious than normal would require and so having that information available to you. I would even share that with my clients, to be quite honest, to show them exactly what’s happening and the rundown of what they can expect when they walk in versus what happens once they leave.

TRACY: I feel like having as much transparency as you can with your clients right now is only going to instill so much more confidence in you as a professional and taking care of them.

JAIME: As a membership organization, what kinds of resources are you offering around protocols and all the things that we’ve talked about so far?

TRACY: Thanks for asking. We recently just put together a back-to-practice resource and it’s, not very pretty. Let me just say that right now. Our team of marketers are working on making it pretty, but what I can tell you is that it is extremely thorough and we have a back-to-practice for massage, hairstylists and barbers, manicurists as well as estheticians, and it’s specific to you guys. It is all compiled with a team of nine editors and researchers from all types of resources within the industry and outside the industry. They’ve talked to doctors and epidemiologists, and really outlined ideas for you to be as safe as possible as well as talking to the clients. But you’ll notice that in the introduction, we don’t feel as an organization that it is 100% safe to go back to practice, but we understand that you may need to go back to practice and so that’s why we’ve compiled all these details. 

JAIME: Do we need to be members to access those resources?

TRACY: No, you don’t, and that’s one of the great things. So for this back-to-practice, you definitely don’t have to be a member. Also on the homepage of all the sites, I believe, and there’s going to be one coming soon for hair and nails, we’ve put together a special issue of one of our magazines. It’s the COVID issue and it talks a lot in detail. Now things are changing rapidly and it feels like each week is two years, things happen so fast. We’re trying to keep things up to date as possible, and nonmembers can just go to the homepage and click COVID and that will have all the newest things on there as well which will include, as we discussed, those intake forms and waivers and things once those are available.

JAIME: We’ll have all of those links in our show notes so our listeners can find that easily, Tracy. Thank you so much for providing that.

TRACY: Great. Good, good, good. And outside of the COVID-19 we really try to encourage continuing education on a regular basis from the experts, and also too, we have lots of tips and techniques, whether it’s about how to build your business or even do a new service that you might be interested in so, we’re doing videos all the time.

ASHLEY:  What other benefits do Associated Professionals’ sister organizations offer to their members besides liability insurance, which I know it’s a big one, but you guys do so much else, I want to hear about what else they can expect.

TRACY: Well, this is kind of my favorite part because I work so closely on all these benefits. Of course, our member magazines. So you get a print version if you’re a member. You can access a digital one if you’re not a member, but they’re all award-winning publications. They’re beautiful. The writers are amazing. The contributors are amazing. The artwork is gorgeous. So those are six times a year. We have Skin Deep magazine. We have Massage and Bodywork magazine, and a brand new one that’s going to be coming out here very shortly. It’s called Indie Stylist and that is for hairstylists, barbers, and manicurists. That’ll be coming out soon. We also have lots of other things. So for instance on the ASCP side we have a career toolkit and it’s beautiful. It’s like two different portals. One is for an employee. One is for someone who is a business owner who wants to start a business, and it does this really fun little career quiz at the beginning, kind of like a Cosmo quiz telling you what you’re more suited for, and then it leads you to that portal where it has resources, whether it’s podcasts, like audio files, video files, articles. It also has tons of calculators. So let’s say you are starting your business. It asks you questions just like TurboTax would about what type of business you’re starting and it’ll take you down all the roads depending on what type of business it is, that you need to be able to answer before you start your business. It also will help you figure out what your compensation is, whether you’re an employee or you are an owner based on services that you’ll be providing and setting up your menu. Like, I just encourage everybody to go check it out, and that’s a member-only benefit. Then also too, we offer a free website and matching URL as well as the builder templates, so you don’t have to go to Squarespace if you don’t want to. It’s part of member benefits. And then we have all the corresponding marketing collateral that matches it so all your gift certificates, your reminder cards, any of those types of things. We have pre-made memes so there’s enough memes for a year so that you could put a social media meme out once a week and it’s all done for you so that you’re staying in touch with your clients. That’s for the people who just need it to be really, really easy. But we have tons of things. You know, we do discounts. We are always reaching out to our members to hear their stories. We want it to be collaborative. We do things like esthy of the year. We’re going to be doing more things like that for the nail artists and manicurists as well as for the hairstylists and barbers so stay tuned for that. I just recently took over those associations so it’s going to be on fire soon. You guys all have so much stuff. It’s going to be crazy. That’s just me rambling a few things off.

JAIME: There’s so much that I think that some of our listeners might be thinking, well, that’s gotta be expensive. Could you just touch on how incredibly affordable all that is, plus the insurance protection?

TRACY: Yeah, of course. So for all of the associations, ABMP, AHP, ANP, they’re only $199 for the year, so that’s all your insurance, a support system, just a dial away, like a phone call away or a chat away, any question that you may have and then all this marketing collateral. Now esthetics for ASCP, that’s a little more expensive. That’s $259 per year. You guys do some riskier services, but it’s still a great deal. And here’s the other thing, and I don’t even think I told Jaime and Ashley this yet, but guess what? Any of your listeners, we’re going to give you guys $20 off, if they use a very special URL and I will give that to you guys within the show notes.

JAIME: So appreciate that. I teach an entire class about salon safety, and I think in reflecting on what I say, if there were one thing to spend your money on, as a salon owner or as an individual service provider, this has got to be number one, whether it’s a requirement or not. If you’re in business, you must, you must protect it. You’ve been so generous with your time and certainly have made this entire topic of insurance digestible for all of us.

TRACY: Well, good stuff. And when in doubt, refer out, is what they always say. And if you ever have questions, just call member services. And even if you’re a member, or you’re not a member, and we’ll help you. We’ll walk you through it.

ASHLEY: Well, thank you so much for your time today and I know that this is going to be one of our most listened series of episodes. If you’re listening to part two, make sure you go back and listen to part one.    

TRACY: Well, thank you so much ladies. It’s been a blast. 

JAIME: Tracy, we can’t thank you enough for your generosity and all this information you’ve shared with us today and a special offer you’ve made for our listeners to get discounted insurance through Associated Professionals. We’ll be sure to have those links in our notes.

ASHLEY: Please subscribe, rate, and review Outgrowth on your favorite podcast platform. It helps us reach more listeners like you.

JAIME: We love to hear from you. Make sure that you contact us through our email at   outgrowthpodcast@gmail.com. As always, you can follow us and comment on recent episodes on Instagram at @outgrowthpodcast.

ASHLEY: Until next week.

JAIME: Stay safe.

ASHLEY: Bye.

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