What is Liquor Liability Insurance?

Many adults enjoy consuming alcoholic beverages at bars, restaurants, and other establishments. However, as a business owner, serving alcohol poses a risk to your company, as you take on a degree of legal responsibility for your patrons. If an inebriated guest causes an injury, death, or other damages, your business could be sued. Liquor liability insurance helps to provide financial protections for New York establishments that serve alcohol.

Liquor Liability Insurance New York

What are the New York Laws?

Many states across the country, including NY, have “Dram Shop” laws. These laws apply to restaurants, bars, liquor stores, and any other business that serves or sells alcohol. By these laws, if you serve an obviously intoxicated person, and that person goes on to cause injury, death, or other harm, your business is legally liable and can be made to pay damages.

Despite these laws, NY does not require businesses that distribute alcohol to carry liability insurance. However, industry experts strongly recommend businesses invest in this important coverage. If your business is involved in a wrongful death lawsuit, or one involving permanent disability, you could be on the line for tens or hundreds of thousands of dollars, or even into the millions. Few businesses can afford this kind of expense.

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What Does Liquor Liability Insurance Cover?

When you purchase liquor liability insurance, you are getting broad protections against the many potential situations that can arise when alcohol is consumed. Bars, restaurants, taverns, country clubs, liquor stores, and other businesses are eligible to purchase these policies, which can include payments for defense and court and legal fees, as well as damages and settlements.

For complete protection, your policy should include coverage for:

  • Drunk driving accidents, including injuries, deaths, and property damage
  • Assault and battery coverage for patrons who engage in a physical fight
  • Sexual assault and harassment coverage
  • Slips, falls, and other personal injuries
  • Personal injury coverage
  • Property damage coverage
  • Coverage for employees who may drink on the job

While these policies can be expensive, the damages that you could be responsible for could seriously jeopardize your business. Many policies offer premium discounts for employee training programs and other safety measures, as well as for a history of safety.

Liquor Liability Insurance New York

Are There Policy Restrictions?

Even the most comprehensive liquor liability policy will not cover all situations. Be sure to review all coverage forms with your insurance agent or broker and understand what you are buying, if there is a certain exclusion that is concerning to you continue negotiating for better terms and conditions. 

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If your New York business serves or distributes alcohol, you are expected to encourage legal and responsible alcohol consumption. Training employees on checking identification, signs of inebriation, and how to deal with unruly patrons can greatly reduce the risk of damages due to intoxication. However, if such damages, injuries, or deaths occur, your business could be held liable. Liquor liability insurance can help cover many of the costs associated with these lawsuits, protecting your business.

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