Bars and restaurants must have liquor liability to protect them against alcohol-related losses. But what about other establishments or entities who only serve alcohol occasionally? Host Liquor Liability coverage is designed to cover your liquor liability as a host serving liquor at a party or other event. Most of the time host liquor liability is included on your General Liability policy.
Protection During Social Events
Host Liquor insurance provides coverage for claims arising from alcohol-related losses stemming from serving alcoholic beverages at a social event or BYOB situation. Its intended purpose is to protect the host of such events.
Let’s say you are hosting a company picnic celebrating a successful quarter. You provide delicious food from local establishments plus beer and wine. Everyone has a great time, and the party lasts for several hours. However, like all good things, the party must end, and everyone heads home. Unfortunately, on the way home one of your employees accidentally runs a red light striking another vehicle. The other driver is injured and decides to sue you for the resulting medical bills claiming you are responsible for over-serving your employee causing the accident.
Fortunately for you, you will have coverage under your general liability policy for the ensuing lawsuit.
Exclusions Regarding Liquor Liability
You will find the Host Liquor coverage is under Coverage A of the ISO General Liability coverage form. Coverage A refers to damages against the insured because of bodily injury or property damage. However, there is a liquor liability exclusion under this coverage to be aware of. The exclusion drops coverage for bodily harm or property damage for which any insured may be responsible for due to any of the following:
- Provided alcoholic beverages to someone under the legal drinking age or “under the influence”
- Caused or contributed to someone’s intoxication
- Violated an ordinance, regulation or statute pertaining to the distribution, sale, use or gift of alcoholic beverages
Under a General Liability policy there is Liquor Liability exclusion pertaining to insureds that are in the business of distributing, manufacturing, selling, serving or furnishing alcoholic beverages. It is aimed at establishments like taverns, wineries, bars, and breweries, whose primary operations involve manufacturing, selling or serving alcoholic beverages.
Businesses not in the business of making, selling or serving liquor are outside of the liquor exclusion. It’s also important to understand if you allow a BYOB situation, that you will have coverage under Host Liquor Liability.
Understanding the ins and outs of coverages for businesses that provide alcohol can be tricky. But it is imperative you know where your business falls on this spectrum.
For more information about Host Liquor Liability insurance and how it applies to you, please give our insurance experts a call. They will be able to answer any questions you may have and guide you towards the best course of action for your situation.