Liquor Liabilities – The Risks

Have you ever been to a company event and noticed a guest that has been served too many drinks? Have you ever wondered who would be responsible if this patron hurt him or herself, or caused harm to someone else due to intoxication? Most commercial liability insurance packages exclude liquor liability coverage, which can leave your company vulnerable to claims of over serving at a business event. Before hosting an event and choosing to serve alcohol, you should not only determine whether or not your organization has the proper liquor liability coverage, but also consider ways to reduce the risk of over serving.

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A business that does not serve alcohol as a part of their day-to-day operations, but decides to throw an event with alcohol, will need to review its policy for liquor liability coverage. Serving alcohol will most likely not be covered under your general commercial liability policy. Therefore, your business should consider adding the host liquor liability coverage endorsement onto your policy. This endorsement will protect your business if someone or something at your event is injured or damaged as a result of intoxication. This endorsement, however, will not provide coverage if your company violates the law, such as serving alcohol to a minor. A discussion with an insurance professional about the event will help provide your company with the necessary coverage needed and can further educate you on the policy exclusions.

In addition to the host liquor liability coverage, your business should consider taking proper precautions to reduce the risk of injury due to alcohol. The following precautions are ways to prevent injury as a result of overconsumption:

  • Serve food to prevent guests from drinking on an empty stomach
  •  Put up signs to drink responsibly
  • Do not serve to minors
  • Obtain the proper licenses and permits
  • Hire professional bartenders that can recognize intoxicated patrons
  • Hire security for the event
  • Provide volunteers to give rides for guests who have been drinking

The best way of preventing claims is to decrease the risk exposure from the start. If an accident does occur, your liquor liability coverage can protect your company against a claim.

Lamb Financial Group is a New York insurance broker specializing in serving nonprofits and other social services organizations. By speaking with an insurance professional from Lamb Financial Group, you can find the appropriate coverage needed for your organization’s event.

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