I have seen many soy candle makers advertise their candles in this way. As a chandler, I find several things wrong with the practice of using any candle in this way.
1. Dyes in candles are not skin safe. Chandlers do not use skin safe dye in their candles. There are dyes for lotion that are designed to be used in cosmetics and are not harmful to the skin. Dyes for candles are much more powerful dyes and have not been tested for the skin, because they were made for candles not lotion. It takes much more dye to color a candle than to color lotion. At these concentrated levels you may experience some skin irritation .
2. Lotion candles are not made from lotion. I have heard some chandlers say that their candle is made from lotion not wax. There is no such thing as a lotion candle. You can only make a candle from some form of wax. Soy candles are made from soybean wax, which is made from soybean oil. The soy wax that is bought for candle making is not a cosmetic grade of wax. The FDA requires any cosmetic to meet specific requirements to ensure the safety of cosmetic products to the public.
3. Fragrance oils used in candles are not all skin safe. Most candle makers use up to 9% fragrance oil in their candles. Even if a chandler uses skin safe fragrance oil it is only skin safe up to 3%. Having experience making candles, I can tell you that fragrance oil in its pure form can cause a serious chemical burn. It may burn your skin in the same way acid would burn your skin. Therefore, rubbing scented candle wax on your skin may cause irritation to your skin .
4. Never dip your hands into a flaming candle. It is true that soy wax burns cooler than paraffin; however the flame of any candle will burn you severely. "Lotion candles" usually say to extinguish the flame first, but I have seen chandlers demonstrate the use of "lotion candles" at craft shows without extinguishing the flame.
5. If you have children never let them see you dip your hands into a hot candle. Soy wax does burn much cooler than other candles; however a child will not know the difference between a "lotion candle" and a paraffin candle. Hot wax on a child's skin could cause very serious damage. So if you decide to use "lotion candles" please be responsible.
Soy candles are wonderful, but I don't recommend using them as lotion candles. There are several lotions available to you including soy lotion that have skin safe ingredients added to it.