The Risks of Serving Alcohol to Underage Patrons
As colleges and universities gear up for the start of the new academic year, bars and restaurants should revisit their measures to protect against serving alcohol to underage patrons. For many establishments, the new school year may bring with it some employee turnover and the need to train new hires in the firm’s liquor protocols, as well as to reinforce them with existing employees.
Even though liquor liability laws vary by state, the consequences for a restaurant or bar of any incident involving an alcohol violation can be devastating. From fines and penalties, to the loss of a liquor license, major lawsuits and enduring damage to reputation, liquor-related exposures are among the most serious threats to a restaurant or bar’s success and survival.
Contributory Comparative Negligence
Notably, in some states, such as Alabama, any establishment that even serves a patron an alcoholic beverage can be fully liable under the legal concept of “contributory comparative negligence” for any related harm to the patron or damages. In effect, regardless of whether or not the patron even consumed the alcohol he or she was served, the establishment may be 100 percent liable for economic damage, bodily injury or loss of life caused or sustained by the patron.
Complying with State Certification Requirements
To protect themselves against these risks, restaurants and bars of all sizes should make sure that every one of their employees involved in serving alcohol completes all required training and receives a state-mandated alcohol-serving training certificate.
Employee Training and Communication Is Crucial
To reinforce state-mandated certification, restaurants and bars should detail their alcohol serving policies in employee handbooks, manuals and communications, and provide regular staff training on their protocols. All employees should fully recognize and embrace the high priority the establishment places on these protocols, take ownership of their related responsibilities, and know what to do if a patron appears inebriated or raises issues when alcohol is denied.
Liquor Liability Insurance Provides Critical Protection
Owners and financial managers should work with their insurance advisors to determine whether and how their existing insurance policies address liquor liability. In most cases, restaurants and bars will need to purchase separate liquor liability coverage. Premium costs vary by state, size and location of the establishment, loss history and other factors.
Given the size and scope of the risk, most establishments should carry liquor liability insurance limits of at least $1 million per occurrence with $1 million or $2 million aggregate coverage. All liquor liability insurance policies require full compliance with state laws, including documenting that all those involved in serving alcohol complete state-mandated alcohol-server training certification.
Contact Restaurant Programs of America for Risk Management Assistance
For assistance in assessing and managing all aspects of your establishment’s liquor liability risks, contact Restaurant Programs of America at (866) 324-1099.
by J.J. Ayala
Senior Account Executive
RPA Insurance Services, LLC