Any business that serves alcohol has a legal obligation to do so responsibly. In turn, you can be held accountable if a patron is injured or causes harm to someone else after becoming intoxicated at your establishment. Fortunately, liquor liability insurance exists to provide financial protection in situations such as this. However, these types of policies can be confusing, and many business owners need clarification when exploring their coverage options. Here are the answers to some of the most common questions that arise during the shopping process.

What to Know About Liquor Liability Insurance

Why is liquor liability insurance necessary?

Regardless of how cautious you and your staff are, there is a significant risk involved in providing guests alcohol. As a business owner, you have a duty to keep all your patrons safe, even those who have consumed too much alcohol. The only way to protect your business from potential losses due to a liability claim caused by intoxication is with liquor liability insurance.

Who needs it?

If you operate an establishment in Alabama that serves alcohol in any capacity, you’re required to obtain proof of liquor liability insurance before you can apply for a liquor license. This includes bars, restaurants, hotels, and nightclubs. If you allow guests to bring their own liquor and drink at your business or serve alcohol at a company party you’re hosting, you may also need coverage.

What does it cover?

A liquor liability policy will help pay property damages and medical expenses for any injuries arising out of a patron’s intoxication. It will also cover your legal fees if your business is sued. In most cases, coverage will include incidents such as drunken driving, alcohol poisoning, and slip and falls, but you’ll likely need to buy specific coverage for assaults.

How do these policies work?

Liquor liability insurance can be added as an endorsement to a general liability or business owner’s policy or purchased as a standalone policy. There is a per-incident limit and per-policy limit on how much the insurer will pay out in the event of a claim. The per-incident limit refers to the maximum amount that will be paid out on each claim. The per-policy limit is for all incidents that occur in a year.

If you have further questions about liquor liability insurance or need help securing the right amount of coverage, turn to Absolute Insurance Agency in Foley, AL. They offer reliable products from various financially sound companies and will assist you in finding the most suitable solution for your establishment. Backed by over 30 years of combined industry experience, this team of agents is dedicated to providing local business owners with quality protection at affordable prices. Call (251) 942-6837 to request a quote, or visit them online for more information on their services.