Liquor Liability Concerns and Hospitality Insurance
It could take some time to find just the right insurance broker to handle the special liability insurance needs of clubs, bars, and restaurants. Any business that sells, serves, or allows alcoholic beverages to be consumed on the premises should be concerned about their liability issues. Hospitality insurance, in the form of liquor liability coverage, protects your business should your customers or patrons end up suing your business for damages related to being intoxicated.
Most food service businesses that serve alcoholic beverages carry liquor liability insurance in order to be covered for any possible costs related to claims of liquor-related injuries, assaults, or accidents that occur on and off their business premises. Coverage options may vary, depending on the policy that was purchased.
Most states have “dram shop” laws
Most states have “dram shop” laws that will hold your restaurant or catering business accountable if, for example, one of your employees serves alcohol to someone who is already visibly intoxicated and then proceeds to cause harm to either themselves or others. If an incident occurs where an intoxicated client attacks another patron, or in the event they drive their car and end up having a car accident, any affected party could actually hold your establishment responsible for damages and file a lawsuit.
Having liquor liability insurance ensures that your business will be covered for the legal fees, settlements, and medical costs that your business may face, up to the limits of your existing policy. In order to get an idea of how quickly these type of violations can add up, let’s presume that one of your servers does serve alcohol to an inebriated person who causes an auto accident on his or her way home.
In addition to any property damages and/or physical injuries that result from the wreck, your food business could be found liable for violating state laws pertaining to not having hospitality insurance coverage, serving an intoxicated person more alcohol, or failing to properly train your employees in how to handle inebriated patrons.
Even when your business is found not at fault, lawsuits without merit happen all the time. You’ll still end up having to hire a lawyer to defend your business, and attorney fees alone can be enough to financially desecrate a small business. Speak to an agent about any questions you may have regarding hospitality insurance coverage.