Are you the owner and operator of a liquor store, distribution center, manufacturing facility, restaurant or pub in Canada? If so, you may be required by law to carry liquor liability insurance, also known as dram shop insurance. This insurance protects businesses that sell, manufacture, distribute or supply alcoholic beverages in Canada from third-party lawsuits and claims associated with intoxication. It is important to note that this insurance does not cover general hazards related to the basic consumption of an alcoholic beverage.
Liquor Liability Insurance Coverage
Liquor liability insurance coverage is not offered to businesses that earn a profit from alcohol while only carrying basic general liability policy. This type of insurance is oftentimes endorsed on to a general liability policy. However, it can also be purchased separately to fill gaps of coverage.
Stand Alone Or Packaged Policy
Liquor liability insurance is often sold as a stand-alone policy. But, some businesses will opt to package this coverage with a general liability policy. As a business owner that sells alcoholic beverages, you probably are aware of the risk of liability claims brought by customers.
Customers who are injured during a liquor-induced altercation or fight will oftentimes file a claim or lawsuit against the bar, pub, restaurant or club. While this does not seem rightly fair that the business be responsible injuries sustained during an alcohol-related brawl, it is a fact of life. Even if the customer injured herself/himself, while intoxicated in your establishment, the business owner could be responsible.
Standard liquor liability insurance will protect your business from financial loss related to these types of injuries. If you do not have this coverage at the time of the incident, you will be forced to pay out-of-pocket for the complainant’s hospital bills and pain and suffering.
Liquor Liability Coverage – Who Needs It?
Businesses that could benefit from liquor liability insurance coverage include:
- Bars
- Pubs
- Clubs
- Caterers
- Restaurants
- Taverns
- Wineries
- Breweries
- Liquor stores
- Grocery stores
It is important to note that liquor liability insurance is not designed to replace a general liability policy. It is highly recommended for any business that sells, manufacturers and distributes alcohol in Canada.
What Is Host Liquor Liability Insurance?
All businesses that serve alcohol are not excluded from liquor liability. The businesses that have an incidental exposure of alcohol should carry a quality host liquor liability policy. This coverage is designed to protect businesses that serve alcohol at company parties.
For example, an employee attending the party becomes intoxicated and chooses to drive home. On the drive home, the employee veers off the road, crashing into a pedestrian. While the company is not the one responsible for supplying or serving the alcohol, it is responsible for the pedestrian’s injuries. This is where general liability insurance coverage will come into play, as it will protect the business from financial loss associated with the alcohol-induced MVA claims.
Now, if the business had been a pub or bar, the general liability insurance coverage will not cover the damages or bodily injuries caused by the alcohol-induced motor vehicle accident. In order for the bar to be fully protected from this claim, they would need to have a liquor liability insurance policy in force at the time of the accident.
How Much Does Liquor Liability Insurance Cost?
The cost of liquor liability insurance is determined by a businesses’ level of exposure, claims history, industry and industry. A company with a poor claims history, located in a high-crime area and operates a restaurant will pay a higher premium than a company located in a low-crime area, has a good claims history and operates a catering business.
Contact Us Today!
To determine your average cost of liquor liability insurance, just complete and submit the quote form on the ProfessionalsCoverage website. Once you receive your free quote, feel free to make a comparison to see which insurer is offering you the best deal – not the lowest premium. The agents at ProfessionalsCoverage are on standby waiting for your call.
