Bars and restaurants are often small businesses, typically owned by one or two people that do not have stacks of cash in the bank to cover the damages that can result from an accident caused by alcohol overconsumption. Bar and restaurant owners rely on the monthly income from their businesses to pay their bills and don’t have enough capital should they get sued over an alcohol-related incident. Bars and restaurants are typically set up as limited liability corporations (LLCs) to protect their owners from any personal liability. But is that enough?
The Texas Dram Shop Act was passed in 1987, which holds drinking establishments liable for injuries resulting from the overconsumption of alcohol. Without a liquor liability requirement, you can see how inherently problematic this is for business owners. Since that time, there have been other bills put forth by Texas legislators to require alcohol providers to carry liquor liability insurance. The most recent bill was Bill 409, which was offered for consideration by the legislature back in 2015. Due to intense industry opposition and despite the glaring need for it to be passed, the bill failed to be enacted into law.
Well, what does this mean for liquor liability insurance? It’s currently not required by the state of Texas.
If It’s Not Required, Why Do I Need Liquor Liability Insurance?
It is critical that you invest in this type of insurance before a problem arises, or you and your business could be in serious trouble. You could face a lawsuit related to alcohol overconsumption – from damage to the physical property to injuries of the customer. We strongly recommend you purchase a liquor liability insurance policy to protect your establishment, assets, and hard work. Liquor liability policies vary in cost, from basic policies that run about $500 to more advanced policies that can be in the thousands of dollars in premiums each year. The policy amount purchased often depends on several factors, such as the size of the establishment, location of the establishment, type of business, and how much alcohol is sold each year.
Simply stated, if your business serves alcohol and you don’t have an appropriate policy, you’re putting your establishment and yourself at risk each day. Many bars and restaurants, especially the smaller, family-owned ones, don’t have the financial means to pay out of pocket for things like unforeseen attorney fees, court costs, and potential damages that someone on the wrong end of an alcohol-induced incident could cause. Lawsuits are notorious for dragging out, causing fees to add up, costing your business tens of thousands of dollars when it’s all said and done. It’s not worth the risk. Protect your livelihood with a policy.
Prepare for the unexpected. Food & Beverage Insurance Agency is there not just as your agent but as your PARTNER so that you will be ready for the unexpected when it does occur – because accidents and mishaps do happen. Contact us today!
