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by Barbara A. Morris

Whether you own and operate your hotel's spa center or lease the space to an outside spa-management firm, it's critical that you know what type of insurance is in place to protect against financial loss should the unthinkable occur.
Slips and falls, alleged improper instruction massages in the wet room, fires, broken mirrors and severe weather conditions are just a few of the real-life scenarios that can play havoc with the financial security of a spa operation _ and the hotel or building with which it's associated.

First and foremost, advise insurance experts, take the time to review your hotel spa facility's insurance policy so that you're thoroughly familiar with the exposures that are and are not covered. Ask your insurer or company representative to go over the policy's terms and conditions to avoid unpleasant surprises.

If you lease the spa facility to an outside subcontractor such as a spa-management company, insist on seeing proof of insurance in the form of a "Certificate of Insurance," says Robert J. Kuchefski of Hoffman Insurance Services Inc. (Wellesley, MA), a brokerage firm that covers more than 200 U.S. and Canadian health and spa operations. Likewise, says Kuchefski, know what's excluded on a policy and be sure that the services being offered at your spa are in sync with those exclusions. For example, Kuchefski says policies will often exclude tanning machines. If your facility's policy has such an exclusion, but the spa offer tanning services anyway, watch out.

Experts also caution that if the hotel and spa operator/manager have specific responsibilities associated with the facility, such duties must be carefully delineated, and each party must obtain the necessary insurance coverage. Andrea Publiese, vice president, health, fitness, and spa division, Hughes & Associates (Chalfont, PA), a large agency specializing in insurance for health clubs and spas, outlines the following broad areas of coverage that any spa facility operator _ including hotels with health clubs _ should address before opening the doors for business.

. General Liability responds to a broad range of potential liability exposures to which the spa is subject, such as slips and falls, pool-related injuries, accidents involving bath equipment and massage therapy injuries. Pugliese also notes that the commercial general liability policy will respond to claims related to products sold at your spa facility, such as nutritional supplements, but only if they are not manufactured by the spa.

. Professional Liability coverage would respond to allegations that either the services rendered _ or not rendered _ by a therapist or spa employee resulted in injury.
Cheryl Meyers, senior account executive who heads the spa/health club program at K Insurance, (Ft. Wayne, IN), cites additional coverages: First-party medical benefits (no-fault medical coverage) is triggered by injury to a client whether or not the spa has been proven negligent; and participation medical coverage, also a no-fault product, is triggered by injury arising out of the member's participation in any spa-related activity, such as fitness.

. Property Coverage, especially that which addresses the building, contents and improvements/betterments made to the hotel's spa center, also are important coverages. Meyers notes that because different types of policies will cover or exclude certain perils, the hotel spa facility's operator must carefully evaluate the scope of coverage desired. She cautions, however, that earthquake and flood insurance generally are not included in the property form and must be added on. Other necessary coverage cited by insurance experts familiar with spa centers include the following.

Take the time to review
your hotel spa facility's
insurance policy so
that you're thoroughly
familiar with the
exposures that are and
are not covered.

. Business interruption and Additional expense provides income while a spa is out of operation due to a loss as well as ongoing expenses while the facility is out of operation.

. Personal Injury and Advertising Injury covers allegations of offensive or misleading advertising, or charges of libel or slander arising out of the hotel spa's advertising materials. 4 Theft coverage is triggered by the theft of a guest's belongings while he or she is a client at your hotel-based spa center. Experts note that if you opt not to carry such coverage, you should prominently display signs indicating the facility is not responsible for the personal property of its guests and spa clients.

. Employment-related Practices covers allegations of employee discrimination, wrongful termination and other related incidents.

. Crime Coverage would respond to employee dishonesty, such as pilfering the cash drawer.
Also critical, advises Pugliese, is the importance of insuring to value on the property side. Specifically, she cautions that most policies carry co-insurance clauses that compel the insured to carry an amount of insurance value equal to a certain percentage level _ commonly 80 percent. Failure to carry adequate insurance will result in penalties in the event of a loss and could seriously compromise the final claim payment.

The bottom line, advise experts, is that while not all coverages may be desired, or even appropriate, for a given spa setting, it's critical to become educated about the options available in the marketplace so that the spa director and hotel manager can make informed decisions.

Marine Agency now offers the only insurance package specifically created for Day Spas.

The only package of this kind in existence!

The package
provides both professional and premises liability, and
spa property coverage. Coverage is written on an occurence based form
with an A++ "admitted insurance carrier".

Services covered can be chosen from a broad menu to fit the individual day spa's needs. Property coverage for building and/or convents will be "all risk" replacement cost coverage.

Fur further details, contact the industry professionals at the Marine Agency toll-free at (800) 763-4775.