Understanding Insurance Policies

Posted on: 18 November 2018

Mixed drinks, liquor, and beer are often thought of as celebratory or relaxing beverages. Your business needs to be aware of the relationship between alcohol consumption and your legal liability to ensure that you are protected against financial loss in a liquor-related lawsuit.

Many states have provisions that allow for the suing of a business whose employees or patrons consume too much alcohol and then cause significant property damage. There are two primary types of liquor liability insurances available on the market today. Investing in one of these policies can help you fully protect your company's assets in the future.

Host Liquor Liability Insurance

The first type of liquor liability insurance available to companies today is known as host liquor liability. This type of insurance is reserved for companies that host events where alcohol will be consumed, but do not directly sell the alcohol to patrons themselves.

Some examples of situations where host liquor liability insurance can protect your company include the serving of beer or wine at a company picnic, employees bringing in alcoholic drinks to share on a Friday afternoon, or offering important clients a glass of champagne after closing a big deal.

Since your company would merely be acting in a host capacity, the coverage offered by a host liquor liability policy would be sufficient. Many general liability insurance policies have host liquor liability clauses built-in, so talk to your insurance agent to see if you need additional coverage.

Liquor Liability Insurance

Companies that have more direct involvement in liquor distribution need a higher level of protection than host liquor liability insurance can provide. If your business is involved in the manufacturing, serving, or selling of alcoholic beverages, then you will need to discuss the benefits of a comprehensive liquor liability insurance policy.

Dram shop laws that are created at the state level can hold businesses legally responsible for the actions of their customers when those customers consume too much alcohol. A comprehensive liquor liability policy will offer your company compensation for attorneys' fees, damages, and settlement offers in the event that you do face a lawsuit related to the property damage caused by one of your intoxicated customers.

Insurance coverage is critical to the success of any business. Be sure that you are fully protected against the legal ramifications of alcohol consumption by your employees or customers by discussing liquor liability insurance options with your insurance agent today. For more information, contact a company like Cache Valley Insurance Inc.