Are You Covered?

The ABCs of Business Insurance

By Karrie Osborn

We never expect the worst. “Oh, that could never happen to me.” It’s what so many massage therapists have unfortunately thought about their businesses and the risks they run in not having professional liability insurance. Just as important as ethical conduct and sound marketing practices, securing professional liability insurance is a critical component to running a healthy business. Don’t let your passion for the work, the love of your clients, or your pristine ethics convince you otherwise. Accidents and sue-happy clients can happen to anyone. Just ask Linda Lundy, a 34-year massage veteran from Monterey, California.

Risks Realized

Practicing massage since 1975 and working on more than 45,000 bodies, the 61-year-old Lundy had never received a formal complaint about her work. Instead, she was considered the “queen of nurturing,” having built a practice catering to women dealing with cancer. So when she got a phone call last year saying she’d allegedly “hurt” a client nine months earlier, she was distraught, confused, and saddened.

She doesn’t remember the client—one of many she saw when working for a massage team for a major hotel chain in California—or the circumstances, but she recalls the phone call.

Lundy remembers thinking a thousand thoughts when she first heard she had been named with 15 others in a lawsuit by this client. Denial was probably the first. “How could this be? This is not who I am. This is not what I do.” Luckily, Lundy had professional liability insurance.

The client claimed Lundy had adjusted her neck and that, as a result, she had tingling down her arm. Lundy was mortified. She was certain she had only applied the same neck protocol she gave to all her clients. In her heart, Lundy felt the case was trumped up, especially when she learned that in the suit the client had named just about everyone she’d come in contact with during her hotel stay. “Apparently she didn’t like the room, the price, or the view,” Lundy says. In the end, the hotel refunded all of the guest’s money; yet nine months later, the woman resurfaced with a lawyer asking for more.

Without professional liability insurance, Lundy says she would have had to pay at least $15,000 in legal fees to defend the case. If she had been found liable for the full extent of the claimant’s injury, the result without insurance could easily have been financial ruin. Until this time, Lundy looked at business insurance expenses as just another set of fees required to work in the resort environment where she found herself. “The insurance was obligatory to work at these places,” she says. “I never thought I would have to use it.”

Now, having gone through this experience, Lundy advises other therapists to never work without insurance. “The fee is nothing for the peace of mind,” she says. “It’s essential, given today, with the way people sue over nothing.” And even more so during these desperate economic times. 

Though Lundy’s client hadn’t missed a day of work since the session in question and had previously been seeing a chiropractor for carpal tunnel syndrome, the case was settled for less than it would have taken to defend the suit in court. While disturbed by the claim, Lundy used the incident to reevaluate her business and how she approaches each new client.

“The complaint came as a wake-up call for me,” Lundy says. It prompted her to take another look at her intake process and spurred her to be more conscious of how often she checks in with clients while they’re on the table. She reestablished some boundary issues that had been weakened with time and reinvested herself in her own business. Now her code of ethics hangs prominently in her office and she’s saying no to the business relationships that don’t complement her own business and ethics standards.

It Can Happen to You

Despite the best business ethics and hands-on practices, massage therapists and bodyworkers leave themselves open to financial disaster if they are not protected by professional liability insurance. “Even the most cautious and caring therapist has to understand that accidents can happen to anyone,” says Katie Armitage, executive director at Associated Bodywork & Massage Professionals (ABMP), the largest U.S. massage membership association (and publisher of Massage & Bodywork), which includes professional liability insurance as one of its many member benefits.

Kendra Henderson, owner of LA Body Points in Los Angeles, California, illustrates the point. She took her mobile massage business to a senior health fair last year to market her chair massage services to a new clientele. It was the end of a long day and only one client remained. The 88-year-old “Edelyne” waited on the massage chair while one of Henderson’s therapists was sanitizing her hands. Suddenly, through the corner of her eye, Henderson saw the petite woman falling backward off the chair. While initially appearing unscathed, Edelyne eventually asked for an ambulance, which arrived in short order and whisked her away.

Henderson remembers the sense of dread coupled with concern. Her nightmares repeated the image of the little, elderly woman toppling backward. The only relief Henderson felt was in remembering she was protected by her professional liability insurance.

“Insurance is necessary,” Henderson says adamantly. “Accidents happen in our field, or we can easily get blamed for something that may not have been our fault.” She has a laundry list of examples from friends and colleagues who remind her every day of the potential risks out there, including the massage client who slipped in the shower from the oil on her feet and broke her tibia and fibula. “Accidents can and do happen,” Henderson says.

Armitage says having the right insurance protection can help keep the nightmares at bay. “We have had many claims for tables collapsing, on-site chairs collapsing, clients falling or tripping, even a candle that ignited some alcohol that spilled onto the client and caused extensive burns,” she says. “I don’t plan on having a car accident on the way home today, but it could happen and that’s why we all protect ourselves with insurance. You want to protect your assets and even your future earnings.”

Armitage says even the most well-loved therapists can’t control how their clients are feeling on a particular day. “We have seen longtime clients turn on their therapist when they truly believe they’ve been injured in some way. Nothing is guaranteed.”

Shopping for Insurance

Much of the existing marketing hype makes picking the right insurance confusing. Armitage says when shopping around for professional liability insurance, consider some key things.

“First, make sure the policy is occurrence form, that it includes general liability, and has a per member, per year aggregate limit that is not a shared member aggregate,” she says.

Occurrence-form policies are the best option for your liability needs, because they will protect you, even if you are no longer insured. History shows that many claims aren’t filed until the statute of limitations has nearly run out (two years after the incident in most states). So, for example, if your insurance was effective in July 2007, but you let it lapse a year later, went out of business, or changed insurance providers, you would still be covered for any incidents occurring in July 2007 with an occurrence policy. If, however, you had a claims-made policy, you would not be covered in this example. Claims-made policies require that claims be made while the policy is still in effect. If your claims-made policy expired, and someone filed a claim against you, you would have no coverage, even though you were insured at the time of the incident. Claims-made policies are less expensive, but under the adage of you get what you pay for, they also provide considerably less coverage.

General liability is another important piece of your insurance portfolio and is often included as part of your professional liability coverage. Make sure it is. Whereas professional liability covers the work you do, general liability covers the “slip and fall” scenarios. Armitage says ABMP, for example, offers the profession’s best value in liability coverage, including professional liability, general liability, and product liability (in the event clients have an adverse reaction to any of the products you use on them). Many policies offered for massage therapists may have one, but not all of these important pieces.

When shopping for insurance, know what aggregate means. This is typically defined as the total coverage limits allowed under your policy. Some insureds share their policy limits with other members, effectively reducing the policy’s total limits. Armitage says ABMP has the highest aggregate coverages available—$3 million for professional liability, $3 million for general liability, and $3 million for product liability. This coverage is per member, per year, not a shared total like other associations offer.

Massage therapists would also be wise to consider business personal property insurance, which protects for loss of business equipment as the result of fire, theft, flooding, etc.

While these are all crucial things to watch for when researching insurance options, Armitage says don’t forget the smaller details. Does the company charge for additional insured endorsements (AIEs), which are often required by your landlord or employer? Many do. Is there legal defense coverage for covered losses? Does the provider cover all the kinds of modalities you utilize? For example, because of the risk of burning clients with over-warmed stones, hot stone massage is excluded from many professional liability policies. Are all your therapies covered?

A Safety Net

Massage therapy students are some of the first to inquire about the necessity of having professional liability insurance. Armitage says liability insurance protects students from incidents or claims that may occur as a result of their massage program. Do you work in your school’s student clinic as part of your massage education or participate in school-sponsored massage events? Then you are likely liable if someone is harmed during the course of those events and names you as a responsible party. The school’s insurance would most likely cover only the school and its assets from such claims, not individual students. Armitage says ABMP has seen claims in this category reach upward of $500,000. Check with your school to see if you’re protected.

Therapists who work for an employer make up another category often unsure of their liability protection. “Many employers mistakenly think that their employees and contractors are covered by their business policy, when, in fact, the policy does not provide for employees’ individual coverage. And if you are covered under an employer’s policy, you may not have access to their legal defense provision.” Employer’s policies will only apply to services performed on their premises and won’t provide coverage anywhere else. Armitage says it’s a good idea for therapists to maintain their own professional liability insurance to be assured they are fully covered.

Nobody plans on having disaster strike, but things happen. Building a safety net for those unforeseeable times is a sound business practice. Take a look at your business insurance protection and see if the net you’ve built will keep you safe for if, and when, you fall.


 Karrie Osborn is contributing editor for Massage & Bodywork magazine. Contact her at




Protecting Your Business

In addition to professional liability insurance (with general liability and product coverage) and business personal property insurance, there are other coverages you might consider to protect your livelihood.


Property Insurance

If you own the building that houses your business or school, you will want to insure it for the full replacement cost of the building, not the market value or purchase price. Replacement coverage replaces covered losses with new materials without deducting for depreciation.

Business Income

When a covered event prohibits you from doing business as usual and creates a loss of business, some policies cover actual loss of income for up to 12 months.


Business Auto

If your business owns any vehicles, insure them for liability and physical damage.


Workers Compensation

If you have employees, most states mandate that you carry workers compensation coverage. This protects your business if an employee is injured on the job and covers their lost wages and medical expenses as a result of that injury.


Employment Practices Liability

This protects you from claims arising from violations of state and federal
employment laws.



Shopping for Insurance

Questions to Ask About the Policy

•Is this occurrence-form or claims-made coverage?


•Is this a shared member aggregate or are the aggregates per member, per year?


•What does the policy provide? Professional liability, general liability, product liability, or all of the above?


•Is there a charge for adding additional insured endorsements (AIEs)?


•Does it cover all the treatments and therapies I provide?


• What is not covered?


• Are defense costs included?


•What other benefits does the association or insurance provider offer?