• Distributors that offer alcoholic beverages
• Bars, pubs, and taverns
• Commercial property
Over intoxication can lead to poor judgments and accidents, which sometimes involve personal injury or property damage. In Vermont, if an establishment is found responsible for enabling a customer to become so drunk that they cause injury or damage, the establishment might be held financially responsible for the incident and sued. Liquor liability insurance helps protect businesses from this potential risk.
Liquor liability insurance is a narrowly defined form of commercial liability insurance. It helps protect businesses that sell alcohol from liability lawsuits arising from alcohol-related incidents that their customers are involved in. Policies generally cover both property damage and personal injury claims, and they normally help pay both legal defense fees and settlement amounts of covered lawsuits.
Businesses that sell alcohol directly to consumers ought to check customers’ IDs regardless of how robust a business’ liquor liability coverage is. Not only is it illegal to sell alcohol to minors, but doing so can negate all liquor liability protections that a policy provides. Many policies have clauses that clearly state their protections will be voided if alcohol is sold to someone who’s underage. Checking IDs is an efficient way to ensure all customers are of legal age to drink before selling them an adult beverage.
Most businesses that are involved in the making, distribution or sale of alcohol in Vermont should have liquor liability coverages. This includes:
Even hosts of large events where alcohol will be served, such as someone who will have a wedding or graduation party at home, may want to purchase a liquor liability policy, as they may be held liable for the actions of drunk guests. (If hosts have a personal liability or umbrella policy that offers coverage for alcohol served at private events, obtaining additional protection through a liquor liability policy may not be necessary.)
The reason why businesses that sell alcohol typically should have a liquor liability coverage is simple: They may be held financially responsible for injuries or damage that an intoxicated customer causes or suffers. In many cases, an intoxicated individual is held responsible for their actions -- but the business that enabled them to become drunk often is targeted as well.
Even if a business is found innocent of any wrongdoing and, therefore, isn’t ordered to pay a settlement, defending a company in court can be expensive. A single lawsuit could bankrupt a business if it didn’t have an insurance policy to help cover legal expenses.
Liquor liability insurance policies are sometimes available through commercial package policies and business owners policies, and they sometimes have to be purchased as separate, stand-alone policies. For help checking these options, businesses in Vermont can contact an independent insurance agent who specializes in business insurance. A commercial insurance agent will be able to help a business request quotes and compare different policies' coverages so that businesses can choose the one that provides the best protection for them.