Selling liquor in a bar carries with it certain responsibilities for you as the bar owner. You do have a legal obligation not to serve a customer who has already had too much to drink. You may feel that you are very responsible in this regard, but you cannot control what happens when that person decides to leave the bar area. Having liquor liability insurance in place for your bar will protect you if a customer suffers injuries while on your property, whether or not this person is intoxicated. The customer may also cause damage to another patron and you could be held liable for these damages. You cannot afford to be without this type of business insurance.
A typical property insurance policy for a bar does not include liquor liability insurance, even though the main aim of the business is to serve alcoholic beverages. It is, however, sold as an add-on or as a separate insurance policy. Without having this extra coverage in place, you will not be covered in the event that one of the situations described above occurs in the bar and a claim for damages is made against you.
Experts recommend that very few bars have this type or insurance in place because it is very expensive. Along with the increased risk of the possibility of claims arising from the insurance, the insurance providers take a look at your location and the statistics related to damages and injuries resulting from the consumption of alcohol.
When you want to purchase liquor liability insurance, there are certain things you should look for in the policy that you eventually decide to take out. These include:
1. Coverage for Assault and Battery
This coverage will pay the damages sustained if a fight breaks out between patrons of your bar. It will cover the damages to your building and its contents as well as claims for injuries suffered by one or more of the patrons if they deem that the fight was a result of your serving alcohol to the instigator.
2. Cost of Defense
If you are sued for damages, it is a very costly venture to retain the services of a lawyer to defend you in court even if there is no basis for the claims. In a typical $500,000 policy, the value is reduced by $100,000 because insurance providers estimate that this is the amount you would have to pay for legal services.
3. Employee Coverage
Even though you may have rules and regulations about serving alcohol, it is possible that your employees may disregard them. You have to make sure that employees are covered under the policy as patrons so that if they are injured in any way you will still have coverage.
4. Psychological Damages
You may wonder why you would need this type of coverage in a liquor liability insurance policy, but there have been increasing claims in recent years of psychological damage in the form of undue stress in which claimants make charges of damages in a non-physical manner. You do have to make sure you do not limit the amount and type of coverage that you have.
In all cases, your insurance policy will not include coverage for any action that goes against the laws of your state or province with reference to serving alcohol on the premises.