When you're a business owner, you want to make sure that your customers have the best experience possible. That's why we're here to help you learn about liquor liability insurance.

Liquor liability insurance protects against lawsuits related to serving alcohol. If an overserved customer injures themselves or someone else and decides to sue you for damages, liquor liability insurance can help cover those costs.

What is Liquor Liability Insurance?

Businesses that sell, serve or distribute alcohol are protected by liquor liability insurance. This kind of commercial insurance can help pay for claims of physical harm or property damage caused by an intoxicated customer after being served alcohol. It's available as a standalone policy or as an endorsement to a general liability policy.

If your company is sued, liquor liability insurance can offer coverage for:

• Legal fees

• Judgments or agreements

• The expense of repairs to fix property damage

• Medical expenses for treating injuries

What Does Liquor Liability Insurance Cover?

Liquor liability insurance can cover court costs, settlements, and medical expenses if your company sells or serves alcohol to a clearly intoxicated person who later causes harm or damage.

Injuries to Third Parties

Liquor liability insurance can help cover emergency medical costs or court costs if a customer who was intoxicated at your establishment hurts someone else.

Legal Fees

In the event of a lawsuit stemming from an incident involving an overserved customer, liquor liability insurance can help with:

• Court fees
• Lawyer's fees
• Settlements

Property Damage to Other Parties

If someone who became intoxicated at your establishment damages another person's property, your liquor liability insurance may be able to pay for the repairs or replacement.

Assault and Battery Claims

Your business needs can be accommodated with liquor liability insurance. To defend against allegations that a bouncer hurt a patron or to ensure coverage against staff who consume alcohol while on the job, a bar owner may choose to add assault and battery coverage. Additionally, you can obtain coverage for particular acts of aggression, allegations of mental injuries, and more.

What Does Liquor Liability Insurance Not Cover?

Even if an intoxicated customer damages your own business property, liquor liability insurance won't pay for it. You need commercial property insurance for your company's own assets, such as your building, stock, and equipment. Liquor liability also doesn't replace general liability, which handles claims unrelated to alcohol, like a customer slipping on a wet floor.

Who Needs Liquor Liability Coverage?

If your company produces, sells, distributes, or serves alcohol to customers, you likely need liquor liability insurance. Businesses that commonly require this coverage include:

• Restaurants
• Bars and taverns
• Caterers
• Breweries and wineries
• Grocery stores
• Liquor stores

Liquor liability can't replace a general liability policy, so businesses in these categories need to carry both. Coverage is especially important if your company is located in a state with dram shop laws, which allow businesses to be held accountable if they sell or serve alcohol to intoxicated people who then harm themselves or cause property damage.

How Much Does Liquor Liability Insurance Cost?

The price of liquor liability insurance generally depends on the percentage of your sales that come from alcohol. As a result, a bar will probably pay more than a restaurant or grocery store.

The simplest way to learn what your company's coverage will cost is to request a quote, since insurers calculate pricing using several variables that may apply to your business:

Industry

Some sectors are riskier than others, which can result in higher insurance costs.

Location

The state in which your company is located can affect the cost of coverage.

Coverage limits

Your premiums increase as your coverage limit increases. Be aware that some jurisdictions may require businesses to carry a minimum level of liquor liability coverage.

Alcohol sales

Your rate may vary depending on how much alcohol your company sells each year.

What To Look For When Purchasing Liquor Liability Coverage?

When purchasing liquor liability insurance, several factors are worth considering. The first is how much coverage you'll need, which depends on the size of your business and how much alcohol you serve in an average day. Some businesses need more coverage than others because they face higher risk when serving alcohol.

Another consideration is which insurer will handle claims made against you if something happens at your establishment. A good way to find companies that offer this coverage at an affordable price is to talk with local agents who write liquor liability policies for businesses like yours.

How To Get The Best Liquor Liability Insurance?

Many commercial insurance providers offer liquor liability insurance, so it's wise to compare quotes from several. Your small business insurer for other types of coverage is an excellent place to start.

A general liability policy usually allows you to add liquor liability as an endorsement. You can also obtain it separately, or as an addition to a business owners policy (BOP).

Ask for an estimate from insurers that provide coverage for small businesses. To get an estimate, you can consult our professionals at Hotchkiss Insurance. We have offices in Houston, Dallas, San Antonio, and Fort Worth.

Does General Liability Insurance Include Liquor Liability?

No. A typical general liability insurance policy doesn't include liquor liability coverage by default. Instead, you must include it as a recommendation.

What’s The Difference Between Host Liquor Liability And Liquor Liability Coverage?

Liquor liability insurance covers establishments that sell or serve alcoholic beverages. Host liquor liability covers businesses that allow guests to consume alcohol on their property but don't sell it, such as a company that hosts an event where alcohol is available. Host liquor liability is often covered under a company's general liability insurance, while liquor liability for businesses that sell alcohol can be added as an endorsement or purchased separately.

It Doesn't Have To Be Complicated

Liquor liability insurance is a must-have for any bar or restaurant, because it protects against a wide range of liabilities tied to serving alcohol. If you own or manage a business that serves alcohol, make sure you have the right amount of coverage in place, so that if something goes wrong at your establishment, you're protected from the liability that may follow.