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What is liquor liability insurance?
Businesses that sell and/or serve alcohol may be held financially liable for incidents that involve their intoxicated customers. This can present substantial risks, but Texas businesses can help protect themselves from these risks by purchasing liquor liability insurance.
Liquor liability insurance provides specialized coverage for certain alcohol-related incidents that result in injury or property damage. The insurance can help pay legal fees and settlements.
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What Texas businesses need to carry liquor liability coverage?
Texas is one of the few states that doesn’t require liquor liability coverage in order to legally sell/serve alcohol. Most businesses that sell/serve alcohol should still have it, though.
Not insuring against alcohol-related incidents can leave a business open to substantial risks. Consider the multiple lawsuits that could result from a fight between two intoxicated customers:
- The two intoxicated customers might sue for allowing the other party to become overly inebriated
- Someone nearby might try to step away from the conflict but trip, thus presenting another potential lawsuit if they’re injured
- Any bystanders might claim something such as psychological harm and attempt to sue
Even if the business is found not responsible in all of the lawsuits, merely defending against them can be expensive. Paying settlements only increases the cost (by a lot).
Typical Incidents Covered
What types of incidents does liquor liability coverage extend to?
The exact incidents that a liquor liability policy covers are determined by the terms, conditions and exclusions of the particular policy. Policies may provide coverage for incidents described above and others. For instance, a policy with the right terms might help with lawsuits arising from:
- Basic “slip and fall” accidents involving inebriated customers
- Sexual assault perpetrated by inebriated customers
- Non-sexual assault by a single innebreated customer
- Public fights involving multiple inebriated customers
- DUIs caused by inebriated customers after they leave
- Alcohol poisoning that requires hospitalization
An insurance agent who specializes in liquor liability can give specific examples of what a particular policy might cover.
Are alcohol-related incidents covered by general liability insurance?
General liability insurance typically isn’t a suitable substitute for liquor liability. General liability normally doesn’t cover instances such as sexual assault, non-sexual assault, fights, DUIs and alcohol poisoning. Additionally, general liability often doesn’t cover “slip and fall” accidents when the injured person is intoxicated.
Businesses that sell/serve alcohol usually should carry both liquor liability and general liability. These might be purchased together through a commercial package policy, which likely offers the best rates on each coverage.
How much does liquor liability coverage cost?
The premiums charged for liquor liability policies vary. A business’ annual sales, beverages sold, and past claims history are just a few details that typically impact cost. Coverage nonetheless tends to be affordable, and is certainly less than what a major claim might cost.
An independent insurance agent can help businesses get customized quotes to find out how much coverage will cost them. Independent agents aren’t connected to any one insurance company, and thus can recommend the best available policy regardless of what insurer underwrites it. They also can help compare quotes for policies that only offer the one coverage, and package policies that offer liquor liability alongside other coverages.
How can Texas businesses get liquor liability insurance?
For help purchasing liquor liability insurance in Texas, contact the independent insurance agents at Ramey King Insurance. Our agents will work closely with you to determine your business’ specific deductible and limit needs, and then we’ll get several quotes for policies that meet those criteria. With your assistance, you can have confidence that your business is well protected every time it sells to or serves a customer.
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