Liquor Liability: General Liability Coverage Complications

Liquor Liability: General Liability Coverage Complications

Liquor, wine and beer are all great for bringing in money to a restaurant or dining establishment. They make your business a place to go to for celebration or to wind down from a long day. Offering liquor or BYOB service is one of the many ways a restaurant can position itself for a profitable future. Unfortunately, there are some all-too-common events that occur when alcohol is offered within a dining establishment. These issues range from drunk drivers, to overindulgence, to serving minors. All of these events can and will make your business liable, which means you will be on the hook for tens of thousands of dollars in legal fees and more. Will your general liability insurance kick in to cover these costs? Read on to discover why your business would still be at risk.


The Holes in General Liability Insurance

General liability insurance is a must for any business, especially dining establishments. In an environment where there is constant contact with customers and a high occurrence of injuries, general liability insurance is a necessary protection. However, general liability insurance isn’t always enough to safeguard your business. This also is true for BYOB restaurants, as the consumption of the alcohol is still occurring on your premises, thus making your business liable. Here are some of the areas where a lack of specific liquor liability insurance will cost your business:


Damages by Intoxicated Individuals

If a patron is intoxicated on your property, you already are liable for any damage they cause. This is the case whether your establishment is BYOB or if the alcohol was supplied by your restaurant. If the intoxicated person causes a fight and hurts another customer or employee, the injured person can absolutely hold you and your business liable.


Overindulgence Leading to Damages Outside of Your Establishment

Most restaurant owners are surprised to hear that they still can be held liable for the intoxicated customer’s actions after he or she leaves your establishment. If that intoxicated patron leaves, gets in his or her car and causes an accident or property damage, your restaurant will once again be held liable should someone decide to press charges. It does not matter if it is on your property. It just matters that he or she was served on your property.


Charges for Serving Minors

Does your wait staff get a little lazy when it comes to checking IDs? Pretend that your staff serves alcohol to someone under the age of 21, and that patron gets into a car accident or causes some sort of damage. In this situation, your entire establishment could not only be held liable for any damages (as we previously mentioned), but you could also be directly charged with serving a minor, which could escalate into a felony.


How to Mitigate These Risks

Learning about all of these risks may make you want to think twice about allowing alcohol on your premises. However, there definitely are some precautions your business can take that will allow you to serve alcohol responsibly and with mitigated risk.


Cut Off Intoxicated Patrons

If a customer is showing signs of intoxication, such as slow reflexes, slurred or slowed speech, and rapid eye movement, then cut him or her off from consuming more alcohol. Teach your wait staff and/or bartenders to recognize the signs of overindulgence so that they know when to stop serving a customer. This is in everyone’s best interest, including your customer.


Call Taxi or Rideshare Service if Someone is Intoxicated

If someone at your restaurant appears to be intoxicated and is getting his or her car keys out, intervene. See if he or she has someone else who can take him or her home, and offer to order a taxi or rideshare service. If they refuse, you may need to call the police. Explain this is protocol and to keep everyone safe.


Immediately Call the Police if There is a Disturbance

Alcohol often leaves people feeling uninhibited, which unfortunately is a recipe for destruction for some people. If there is a fight or any sort of disturbance, immediately contact local law enforcement to take care of the issue.


Secure Liquor Liability Insurance

Lastly, the best way to protect your business is with liquor liability insurance. Liquor liability coverage protects your business in the areas that are not covered under the umbrella of general liability insurance. If your business offers BYOB, then secure BYOB insurance. Contact RPA today to learn more about how we can help you secure just the right coverages to protect your restaurant business for the long term.