Marketing

From Mickey Mouse to medi-spas

Boomers' quest for the fountain of youth drives demand for coverage

By Phil Zinkewicz

Since the 1950s, marketers have been targeting the Baby Boom generation to promote their wares—everything from coonskin caps and Hula Hoops to hybrid cars and Harleys. Future historians might be able to discover what products were hot in any given year by looking at how old Baby Boomers were at that time.

Now the first Boomers are reaching retirement age and, unless they have a magic picture in their attics a la Dorian Gray, they are looking for products that will keep them younger—or at least make them look younger. It’s not surprising, then, that the beauty services industry is growing rapidly and is dramatically expanding its menu of products and services for aging Boomers.

Just ask Lyla Byers, lead under­writer for the beauty services insurance program at NIPC (National Insurance Professionals Corporation), a division of Risk Placement Services, which is in turn a wholly owned subsidiary of Arthur J. Gallagher Co. NIPC represents more than 200 insurance carriers and accepts niche market business like beauty services from more than 7,000 independent agencies and brokerages across the country.

“The beauty industry has continually been one of the fastest growing industries,” Byers says. “In the last decade, the anti-aging trend and demand for high-technology skin care services have grown by leaps and bounds. This demand has created a strong need for highly trained professionals, and they need insurance.”

The scope of NIPC’s beauty services package is indicative of this trend. It includes manicurists, beauticians and barbers, wax hair removal, eyelash enhancement/extensions, body wraps, massage, ear piercing, tanning, airbrushing, saunas and steam rooms, facials, facial peels including microdermabrasion, electrolysis, light and oxygen devices, photofacial/skin rejuvenation and MCA/needling, which is a collagen actuation treatment.

NIPC also offers coverage for providers of tattoo services, according to Byers. These services include permanent makeup, henna and temporary tattoos, decorative tattoos, and pigment tattoo removal. The NIPC package also covers body piercing, hair removal, hair stimulation and a host of other services.

Welcome to the medi-spa

An increasingly popular venue for the delivery of anti-aging procedures is the medi-spa. These facilities are treatment centers that offer a variety of cosmetic procedures, some where medical professionals must be present, along with non-medical treatments. Medi-spa offerings can include laser services, derma fillers, Botox®, hair removal, massages and aesthetic services.

“Medi-spas combine beauty services and medical procedures, thus providing consumers with a less invasive, more affordable alternative to cosmetic surgery,” says Byers. “Professional liability insurance and malpractice coverage are available to beauty/tattoo/piercing medi-spa technicians as well as medical professionals. Many of the more advanced medi-spa services are required to be performed at a medical facility by a medical profes­sional or under the supervision of a medical professional, depending on the state where the facility is located and licensed.”

Byers says that the medi-spa concept has received a positive response from independent agents and brokers attending exhibits at trade shows. Agents see this as a great marketing tool, she says, and commission levels are 12.5%.

Equally enthusiastic about the medi-spa concept is Joseph Schneider, professional liability manager and branch manager in Plymouth Meeting, Pennsylvania, for Jimcor Agencies, a New Jersey-based MGA and E&S wholesaler. Schneider is also a PLUS Mid-Atlantic Chapter committee member.

Medi-spas fall into three main categories, according to Schneider. Services are offered at beauty salons and doctors’ offices as well as at stand-alone med-spa facilities. “The services include Botox injections, electrolysis, collagen treatments—anything that requires medical supervision,” says Schneider. “The concept first appeared about the year 2000. It was almost immediately accepted by the Baby Boom generation, which wants to stay young in appearance. At Jimcor, our focus is on the professionals at medi-spas. The services are either performed by a medical director or by a technician under the tutelage of a medical director.”

In addition to providing markets and coverages for agents and brokers who have medi-spa clients, Jimcor also assists those producers in educating their clients. “We give agents advice on what should be done to reduce the possibility of injury,” Schneider says. “We have medical experts on our staff who can work with agents to help the client. We tell the agent to provide the client with a disclosure agreement regarding the risks they are undertaking and what can go wrong. We also offer a form to educate the client on what should be done in terms of after-care treatment if something does go wrong.”

Both Byers and Schneider agree that medi-spas will continue to increase in popularity and offer significant growth potential for independent agents and brokers.