Does it matter if I am running my Pilates Studio as a sole trader?

Risks for sole traders from a liability perspective (asset protection):

There are some wonderful things about running a Pilates Studio as a sole trader. Business accounts are simple, and you can focus your energies on Pilates technique, class choreography, and your clientele. It is easy to set-up and maintain from a small business perspective.

However, there are also risks involved. Running a Pilates Studio as a sole trader exposes you to unlimited personal liability – meaning you are solely and completely responsible for any debts of your business. Personal assets in your name such as property may be used to pay your business debts, and this includes any jointly owned assets.

To minimise risk you must either consider setting up a company or trust for the business and/or you must acquire appropriate insurance. Many insurance options are now available for Pilates teachers – shop around to get the best deal and appropriate cover for your studio, and speak to Jess at Sinclair + May for clarification as to what you are signing up for.

It is also a good idea to invest in ongoing accredited training for yourself as a teacher so that you stay relevant in the competitive Pilates market, and also to maintain safe practice, perfect your teaching technique, and reduce the chances of a negligence claim being brought against you.

Part of your risk management should be to have an up to date First Aid Certificate and a suitable First Aid kit on the premises.

Professional indemnity insurance:

In a Pilates’ studio the unfortunate reality is that there could be an injury during class or a private lesson. If this occurs, there is a risk a claim could be brought against you.  Professional indemnity insurance can cover you if you do something (or fail to do something) whilst carrying out your professional duties as a Pilates’ teacher or studio owner.  The coverage will depend on the terms of the insurance policy, and you should always read the terms and conditions of the policy, as well as any exclusions and schedule to the insurance policy, very carefully.

An insurance policy can also provide cover for injuries caused by equipment on your premises. If you hold appropriate insurance, it can cover claims for damages, as well as the legal costs to defend the claim. Again, it will be important to consider the terms and exclusions of the policy, as well as any monetary limits.

If you employ other teachers at your studio as employees, ensure they are covered by your professional indemnity insurance. If you employ other teachers as contractors, it is important to ensure they hold suitable insurance as sole-traders.

Public liability insurance:

Public liability insurance can provide cover for claims of personal injury or property damage that a client suffers or claims to have suffered as a result of your Pilates’ class – and can cover unexpected incidents that occur within and outside your studio.

Product liability insurance:

This is often included in insurance packages offered to Pilates’ professionals, and will be useful if you intend to sell any Pilates’ equipment. It can cover damage or injury caused due to the failure of a product you are selling.

If you would like to protect your assets further:

If you would like to minimise your personal risk,  there are other business options available to Pilates’ Studio owners – and it doesn’t have to cost a fortune or take up lots of precious time.

To get in touch with one of our lawyers, you can book a free 15 minute chat here.

This is general advice only. Liability limited by a scheme approved under Professional Standards Legislation. 

Published Feb 21, 2018

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