Liquor Liability Insurance
What Is Liquor Liability Insurance?
Liquor liability insurance protects businesses that sell or serve alcohol from claims caused by intoxicated customers. It covers bodily injury, property damage, and legal costs if an overserved guest causes harm to others or damages property.
This coverage is commonly required to obtain or keep a liquor license and helps protect businesses from lawsuits related to over-serving alcohol1.
What Liquor Liability Insurance Covers
Liquor liability insurance typically covers:
Physical injury to others
Repair or replace damaged property
Replace or repair destroyed property
Liquor Liability also provides protections in these situations:
- Drunk driving incidents
- Legal and medical expenses if an over-served guest causes a car accident
- Assault and battery
- Injuries from fights or physical altercations involving intoxicated patrons
- Legal defense costs
- Attorney fees, investigations, settlements, and court judgments
Does Your Business Need Liquor Liability Insurance?
This type of coverage is important for any business that sells, serves, or provides alcohol, including:
- Catering companies and mobile bartenders
- Event venues, hotels, and banquet halls
- Special events such as festivals, parties, and private functions
Why Is It Important
Liquor liability insurance protects businesses in several key ways:
- Required for licensing
- Many states and local authorities require it to obtain a liquor license
- Reduces financial risk
- Alcohol increases the risk of accidents, injuries, and lawsuits
- Protects business assets
- Covers costly legal defense, settlements, and damages that could otherwise threaten your business
How Much Does Liquor Liability Insurance Cost?
The costs vary widely based on your business type and risk level. Annual premiums typically range from $200 to $10,000 or more. Businesses that serve alcohol for on-site consumption usually pay more than those that sell sealed alcohol for off-site use.
Some small businesses may find liquor liability policies starting around $25 to $45 per month, while bars, taverns, and event-based venues often pay significantly more.
Typical Insurance Costs by Business Type
Estimated annual costs include2:
- Liquor stores
- Around $200 to $500 per year
- Restaurants
- About $500 to $4,000 per year
- Bars and taverns
- Roughly $2,000 to $10,000 per year
- Caterers
- Typically $500 to $1,500 per year
Factors That Affect Cost
- Alcohol sales volume
- Higher alcohol sales increase exposure to claims and raise premiums.
- Business operations
- Late operating hours
- Live music or entertainment
- Pool tables or similar attractions
- Lack of server training
- Presence of security or trained staff
- Location
- Stricter state or local alcohol laws
- Higher claim frequency
- Higher legal and settlement costs
- Claims history
- Prior alcohol-related incidents increase risk and lead to higher renewal premiums
- C0verage
- Choosing higher limits leads to higher premiums
Liquor Liability Insurance Quote
Your Gild Insurance Agent is here to understand your business and find the right coverage tailored to your needs.
For a free, online quote in minutes, try out Gildber! The fast, hassle-free option for a business insurance.
Frequently Asked Questions
What is liquor liability insurance?
Liquor liability insurance helps protect businesses that serve, sell, or provide alcohol if a customer causes injury or property damage after drinking. It can help cover legal defense costs, settlements, and claims tied to alcohol-related incidents.
Who needs liquor liability insurance?
Businesses that sell, serve, or allow alcohol often need this type of insurance. This includes bars, restaurants, breweries, wineries, event venues, caterers, and businesses that host events where alcohol is served.
Does general liability insurance cover liquor-related incidents?
General liability insurance typically excludes claims related to alcohol service. Liquor liability insurance is designed to fill that gap and provide coverage when alcohol is involved in a claim.
How much does liquor liability insurance cost?
The cost depends on factors like your business type, alcohol sales volume, hours of service, location, and claims history. Coverage limits and risk level also play a role in pricing.
