Liquor Liability Insurance
If you are in the business of manufacturing, selling, or serving alcohol, then you need to purchase liquor liability insurance as most general liability policies will not provide coverage for the exposures you face. Liquor liability protects your business against loss or damages claimed as a result of a patron of your business becoming intoxicated and injuring themselves or others. Liquor liability coverage may be sold as an add-on to a commercial liability policy or as a separate liability policy.
The premium on this type of policy can be high. It is estimated that only 35% of businesses that should have this coverage actually purchase this coverage, in party this is because of misconceptions that exist in the hospitality industry regarding the industry’s liability risks for intoxicated patrons.
Items to discuss with your agent when looking to purchase a liquor liability policy:
- Assault and Battery Coverage – Most claims against bars and restaurants are the results of altercations. Look for a policy that includes coverage for assault and battery claims.
- Defense Costs – In many cases it isn’t the actual cost of the claim that is devastating, but the legal costs involved in defending the claim. Some policies will deduct the defense costs from the total limit provided by the policy. Look for a policy that pays for defense costs in addition to the policy limit. If one is not available, then take the legal costs in consideration when deciding what your limit amount should be.
- Employees Included – It is not uncommon for employees to drink regardless of the rules. Insurers know this and sometimes exclude employees from coverage. Make sure employees are covered as patrons.
Do keep in mind, liquor liability insurance will not provide coverage for claims when liquor is served in contrary to what the law allows.
Call AmeriAgency for all your business insurance needs at 615-209-9362.