Liquor liability insurance protects bars, restaurants, and other businesses that sell and serve alcohol from risks and liabilities caused by intoxicated patrons. Confusion about the regulations governing alcohol-serving establishments and general liability coverage often results in misconceptions about bar insurance. By debunking various misconceptions about this insurance, business owners can prioritize the coverage. Here are some common misconceptions about liquor liability insurance to know about:
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Liquor Liability Insurance Covers Employee Intoxication
Employer liability policies, also known as workers’ compensation insurance, cover employees who may suffer injuries due to workplace accidents. There has to be proof that the employees’ injuries resulted from poor balance, impaired coordination, or other effects of intoxication. Bar insurance also excludes any liability that may have resulted from employee intoxication.
Damages caused by intoxicated employees may result from misconduct like disruptive behavior, negligence, or theft. In reality, liquor liability insurance protects businesses against claims and lawsuits from intoxicated customers. When a legal claim happens, this insurance can offer financial protection by covering settlements, legal fees, or medical expenses.
General Liability Insurance Covers Alcohol-Related Incidents
The risks and liabilities carried by alcohol-related incidents are unique, which prevents general liability insurance from handling them. For an establishment that serves alcohol, to enjoy protection against liabilities from alcohol-related incidents, it needs liquor liability insurance. The non-alcohol business risks that general liability insurance covers include third-party bodily injuries, property damage, and reputational risks. Compared to general liability insurance, liquor liability offers more financial protection, helping alcohol-serving businesses maintain their financial stability.
Liquor Liability Laws Are Similar Everywhere
Legal duties and liabilities that involve alcohol-serving businesses vary across states. Some states mandate coverage for bars, nightclubs, and other related companies, while others do not. Different establishments face varying risks and legal liabilities due to the types of customers they attract, as well as the manner in which they serve alcohol. The requirements for obtaining bar insurance may also vary. Some states may require bars, nightclubs, or other related businesses to have liquor licenses before obtaining this insurance. Other states do not impose additional rules that may affect liquor liability coverage obligations.
Liquor Liability Only Covers Incidents on the Business Premises
If an intoxicated patron’s actions, such as drunk driving or assault, injure another party outside your premises, liquor liability insurance can protect your business. Laws like dram shop laws, which many states enforce for bars, restaurants, and other companies, cover incidents that extend beyond the premises. These laws provide a legal basis for liquor liability insurance, encouraging responsible alcohol service to protect businesses against financial losses. Bar insurance may also include off-premises coverage, including corporate gatherings, weddings, and private parties.
Get Bar Insurance Today
Purchasing liquor liability insurance can protect your business against devastating financial losses that may result from unexpected liabilities or risks. Bars and restaurants must have clear policies that guide alcohol consumption by both employees and customers to minimize liability and enjoy the protection afforded by this insurance. If you’ve ventured into the restaurant industry and need liquor insurance, buy the policy from a reputable agency today.
