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Liquor Liability Insurance: Everything You Need to Know to Protect Your Business

by | Dec 14, 2023 | Liability Insurance | 0 comments

Liquor liability insurance is a type of business insurance that protects you from financial losses if someone is injured or their property is damaged because of an intoxicated person you served alcohol. You need it in Houston because Texas has dram shop laws, which hold businesses liable for the actions of their intoxicated patrons. This means that if someone gets drunk at your bar or restaurant and then causes an accident, you could be sued for damages. Liquor liability insurance can help cover these costs, so you won’t have to pay out of pocket.

Moreover, if an accident ensues from a patron’s drunkenness, businesses may find themselves entangled in legal proceedings, exposing them to potential lawsuits seeking damages. Liquor liability insurance Houston assumes paramount importance in such circumstances, as it serves as a financial safety net, alleviating the burden of out-of-pocket expenses that may arise from legal claims and compensation.

What are the specific risks covered by liquor liability insurance?

Liquor liability insurance encompasses a range of specific risks associated with alcohol service, providing coverage for various scenarios that may arise within an establishment. This coverage extends to incidents involving bodily injury, property damage, legal expenses, and other potential risks.

Bodily Injury: This covers damages arising from physical injuries sustained by someone due to the actions of an intoxicated patron served alcohol by your establishment. This can include injuries from:

  • Fights and assaults: If a drunk patron gets into a fight and injures someone else, your insurance can help cover medical costs, lost wages, and legal fees.
  • Slips and falls: If an intoxicated person trips and falls on your premises, you could be liable for their injuries.
  • Accidents caused by drunk drivers: If someone who was served alcohol at your establishment leaves and causes an accident, your insurance can help cover the costs of injuries and property damage.

Property Damage: This covers damages to property caused by an intoxicated patron. This can include:

  • Damage to your establishment, such as broken windows or furniture.
  • Damage to other people’s property, such as cars or belongings.

Legal Expenses: This covers the costs of defending yourself against lawsuits arising from liquor-related incidents. This can include:

  • Attorney fees
  • Court costs
  • Settlements

Other potential covered risks:

  • Sexual assault and harassment: If an intoxicated patron commits sexual assault or harassment on your premises, your insurance could cover the costs associated with the incident.
  • Intentional acts: Some policies may also cover intentional acts, such as battery, committed by intoxicated patrons.
  • Off-premises events: Some policies may cover events held off-site, such as weddings or private parties, where you are serving alcohol.

How much does liquor liability insurance cost in Houston?

In the domain of insurance for establishments serving alcohol, various factors contribute to the determination of premiums. These encompass the type of establishment, business size, alcohol sales, claims history, coverage limits, deductible choices, location, and the insurance company selected. To obtain precise quotes tailored to individual business needs, it is advisable to engage with a qualified insurance agent, compare quotes from diverse companies, and carefully assess specific risk profiles.

Factors Influencing Premiums:

  • Type of Establishment:
    • Transitioning to the specifics, it is observed that bars and restaurants, in general, incur higher premiums compared to wineries or breweries.
  • Business Size:
    • Correspondingly, premiums escalate for larger establishments characterized by a greater number of employees and heightened sales volumes, reflecting an increased risk profile.
  • Alcohol Sales:
    • An essential determinant is the volume of alcohol sales, where businesses with higher alcohol sales invariably attract higher insurance premiums.
  • Claims History:
    • Passive construction is employed to emphasize that a history of claims leads to an elevation in the insurance premium, underlining the repercussions of past incidents.
  • Coverage Limits:
    • Shifting focus to coverage limits, it is imperative to acknowledge that opting for higher coverage limits directly correlates with an augmentation in insurance premiums.
  • Deductible Choices:
    • Introducing an option for businesses to consider, the passive voice emphasizes that choosing a higher deductible can effectively result in a reduction of the insurance premium.
  • Location:
    • Highlighting the variability in premiums, the passive voice underscores that premiums can fluctuate based on the specific location of the business.
  • Insurance Company Selection:
    • The choice of insurance company emerges as a crucial factor, with different companies offering varying rates for liquor liability coverage.

General Estimates:

  • Providing a snapshot of prevailing trends, small businesses in Houston are reported to pay an average of $55 per month or $659 annually for liquor liability insurance. Meanwhile, larger establishments with elevated risk profiles may face annual costs running into several thousand dollars.

Acquiring Accurate Quotes:

  • Transitioning to actionable steps, the importance of contacting a qualified insurance agent is emphasized. Furthermore, the suggestion to compare quotes from multiple insurance companies is presented as an active measure to obtain the most competitive rates.