Do Liquor Stores Need Liquor Liability Insurance?

Any entity that serves liquor faces a certain level of risk. Parties who purchase alcohol from your store can cause injury or damage, which could in turn hurt your business. Even if you only sell alcohol rather than serving it, you could still be held liable for an accident, even if you never see the customer actually take a drink. 

What is Liquor Liability Insurance? 

Businesses that provide alcohol usually need liquor liability insurance. It covers the losses a business might face if it sells someone alcohol and that person then causes a costly accident. The policy might pay for the costs to clean up the damage caused, for example. And in particular, liquor stores need this coverage because they provide the substance that could contribute to such accidents.  

An illustrative example might clarify why this coverage is essential. Let’s say someone drives drunk and gets into a head-on collision that injures someone else. The injured person could sue the liquor store. They might claim that because the store sold them the alcohol, the store contributed to the intoxication that caused the accident. Store management might have to reach a settlement with the affected party.  

Still, some liquor store proprietors might argue: My store only sold someone the alcohol. It was their choice that they drank it and harmed someone else. I am not responsible.  

It is not that cut and dry.  

Even if you only sold someone a sealed bottle of alcohol, you still provided them a mechanism for intoxication, which is a liability risk. What if you sold a bottle to someone who went right outside, opened the bottle, and then drank it behind the wheel, for instance? On the way home, they caused that head-on wreck.  

Your actions, however innocent, still might have contributed to the accident. The parties harmed by the wreck might try to sue for this reason. With liquor liability insurance, you can usually get financial help with court fees, settlements and other costs that might arise.  

No matter where or when you sell liquor, it is crucial to make sure you have the right coverage. Liquor liability insurance can protect you against a lawsuit and help you recover your reputation after an accident. Consider adding liquor liability insurance to your business insurance policy and speak with your insurance agent about ways you can save money by bundling important coverages.