Liquor liability insurance protects your business or your event against loss or damages claimed as a result of a guest or patron becoming intoxicated and injuring themselves or others. If your business manufactures, sells, serves, or facilitates the uses or purchase of alcohol, then your business may need this coverage. If your event will include alcoholic beverages, you may need the protection this coverage provides.
Liquor liability coverage may be sold as an add-on to a commercial liability policy or as a separate liability policy. But, if you do not purchase this extra coverage your standard liability policy DOES NOT protect you against these kinds of claims.
It is estimated by experts that only 35% of businesses that should have this coverage actually purchase this coverage. Part of this is because of misconceptions that exist in the hospitality industry regarding the industry's liability risks for intoxicated patrons. If you are hosting an event such as a wedding, birthday party or other occasion that includes alcohol, you may be exposed to liability claims.