Category: Service Businesses
NAICS CODE: 812111 Barber Shops
Description of Operations:
Barber shops cut, trim, and style hair for men or women, as well as cut, trim, and style moustaches and beards. There is normally little equipment and no chemical applications other than styling and grooming aids. Services may be offered on a walk-in basis, by appointment only, or both.
Barber shops are subject to province licensing and regulations to reduce possible spread of disease. Shops may employ barbers or may rent space to barbers who are independent contractors. The status of the barbers must be determined since it may impact how coverages apply.
Property exposure consists of a small office and the customer service area. Ignition sources include electrical equipment, heating and air conditioning. If the barber shop is in a converted dwelling, wiring should be checked to verify that it is up to code. Housekeeping has a significant impact, since hair trimmings are flammable. While most grooming aids are not flammable, some hairsprays and ointments may contain alcohol. Ownership of personal property may need to be addressed. Professional equipment such as scissors and electric clippers is quite costly, and is commonly owned by the employee or independent contractor.
Crime exposures are generally limited to theft of money by employees and others if large amounts of cash are on hand.
Inland marine exposures are from valuable papers and records for customers and suppliers. If employees provide their own tools, there may be an employees tools and equipment exposure. If the barber goes to the client’s premises to perform services, there may be goods off premises or in transit.
Occupiers’ Liability exposure is moderate due to public access to the premises. Aisles must be adequate and free of hair clippings and debris with flooring in good condition, no frayed or worn spots on carpet and no cracks or holes in flooring. The number of exits must be sufficient, and be well marked, with backup lighting in case of power failure. Injuries to barbers who are independent contractors are part of the Occupiers’ Liability exposure instead of workers compensation.
Parking lots and sidewalks need to be in good repair with snow and ice removed, and generally level and free of exposure to slips and falls. Security of visitors in parking areas is often deemed the responsibility of the owner or operator of the premises. Factors affecting the risks include exterior lighting, fencing, and any other security measures in place.
Product liability exposure exists if the shop sells shampoo and other items to customers. Of particular concern are any products that are non-standard, independently produced, or proprietary.
Professional liability exposure is usually not a high concern due to the limited services provided in a barber shop. Because of the large number of customers served, a significant, although easily avoided risk, is the transmission of diseases and vermin such as lice. The absence of simple hygienic practises like hand washing and disinfecting solutions for combs and brushes may indicate a morale hazard. Understanding the contractual relationship between the shop and the stylists is important as it has an impact on who is covered.
Automobile exposure is generally limited to hired and Non-owned liability.
Workers compensation exposure is generally limited to minor cuts and scratches from scissors and clippers. Repetitive motion injuries are common. Leg and back injuries may result from standing long hours without resting. Shops with more than one chair might qualify as multiple sole proprietorships, rather than businesses with employees. The contractual relationship helps determine workers compensation exposure, although regulatory definitions of employee may supersede the contract terms.
Minimum recommended coverages for Barber shops:
Business Personal Property, Business Income with Extra Expense, Employee Dishonesty, Valuable Papers and Records, General Liability, Professional Liability, Umbrella Liability, Hired and Non-owned Auto Liability, Workers Compensation
Other coverages to consider for Barber shops :
Building, Employees Tools and Equipment, Employment Practises Liability, Employee Benefits Liability