Protecting your business from liquor liability claims is essential if you sell, serve, or allow the consumption of alcohol on your premises. Here’s a comprehensive approach:
- Obtain Liquor Liability Insurance
- Specialized Coverage: Ensure you have liquor liability insurance separate from general liability insurance.
- Adequate Limits: Work with an insurance broker to determine the appropriate coverage limits for your risk level.
- State Requirements: Some states mandate this insurance—make sure you meet or exceed the legal requirements.
- Comply With Local, State, and Federal Laws
- Licensing: Keep all liquor licenses current and valid.
- Age Verification: Strictly enforce ID checks to avoid serving underage patrons.
- Hours of Sale: Adhere to regulated hours for alcohol sales and service.
- Train Your Staff
- Responsible Beverage Service Training:
- Use programs like TIPS (Training for Intervention Procedures) or ServSafe Alcohol.
- Focus on recognizing signs of intoxication and how to refuse service safely.
- Document Training: Keep records of staff certifications and refresher courses.
- Establish and Enforce Clear Policies
- Service Policies: Write clear guidelines about when and how alcohol is served.
- Refusal of Service: Empower staff to say no and back them up when they do.
- Incident Reporting: Require documentation of all alcohol-related incidents.
- Monitor Patron Behavior
- Visible Intoxication: Don’t serve anyone visibly intoxicated—it’s a common trigger for lawsuits.
- Security Presence: Have trained personnel, especially for events or peak hours.
- Limit Promotions: Avoid promotions that encourage excessive drinking (e.g., “all-you-can-drink” deals).
- Use Technology Wisely
- Surveillance Systems: Install cameras to monitor service areas and entrances.
- ID Scanners: Use ID scanning tools to verify age and identify fake IDs.
- Know Your Legal Defenses
- Dram Shop Laws: Understand your state’s dram shop laws, which hold businesses liable for serving intoxicated or underage persons who later cause harm.
- Comparative Negligence: Know if you can argue that the customer or a third party was partially responsible.
- Consult Legal and Risk Experts
- Regular Legal Review: Have a legal expert review your policies and procedures periodically.
- Risk Assessment: Work with a risk manager or insurance advisor to identify vulnerabilities.