November 16, 2020
Serving alcohol is a common practice for restaurants, bars, catering companies, entertainment venues and similar establishments. While providing a wide array of beverage options is important, serving alcohol in particular can create a variety of risks for business owners.
For instance, if a patron of your business becomes intoxicated and injures a third party or causes property damage, you could be held liable for the damages. In order to protect your business from serious financial and reputational losses, it’s important to consider purchasing liquor liability insurance.
WHAT IS LIQUOR LIABILITY?
The term liquor liability refers to an organization’s legal and financial responsibility for the actions of individuals who consume alcohol at their establishment. Under liquor liability laws, a business can be found liable for both the bodily injury and property damage caused by a person they improperly served alcohol to.
WHAT IS LIQUOR LIABILITY INSURANCE?
Liquor liability insurance is designed to protect any business that sells or serves alcoholic beverages. Specifically, this type of insurance covers damages that result from things like fights, careless behavior or automobile accidents caused by individuals who have consumed alcohol.
Liquor liability is important, as it protects you should your clients or patrons sue your business for damages related to their intoxication—something a general liability policy won’t cover.
Most businesses carry a general liability policy, which covers claims against your business for bodily injury, property damage or personal injury. While these policies often include host liquor liability coverage, they only provide protection related to the incidental service of alcohol. While host liquor liability may protect you if you are simply serving alcohol at a company party, it does not offer the coverage you need if you sell alcohol as part of your business.
What’s more, the majority of states require establishments that serve, sell or assist in the purchase of alcohol to carry liquor liability insurance. As such, it’s important to know what to look for in a policy.
SERVE YOUR PATRONS RESPONSIBLY
When serving liquor, the best way to protect your business from potential claims is through proper risk management and liquor liability insurance. These policies can be complex, and it’s important to discuss the nature of your operations with a qualified insurance broker. Contact Reliance Partners today to learn more.