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Liquor Liability and Your Business

Liquor Liability and Your Business

It is common knowledge that if your business is in the business of providing alcoholic beverages, then you must have a liquor license and purchase liquor liability insurance from your broker. This would be relevant to bars, restaurants, sports facilities and other businesses where liquor is “on the menu”. But what if your business doesn’t typically provide liquor and wants to host an event where liquor is served? Should you allow alcohol at the company picnic? For most businesses, there may be coverage. Let’s examine. Liquor Liability Exclusion The Commercial General Liability Coverage Form (CG 00 01) enumerates a long list of exclusions, including liquor liability. This is how the coverage form reads:               The exclusion says that bodily injury or property damage for which the insured (policyholder) is liable is excluded as it relates to liquor, especially if the business may be held liable for causing intoxication, furnishing alcohol to underage persons or someone who is already intoxicated, or violates any laws with regard to the sale, gift, or distribution of alcoholic beverages. This seems pretty clear. There is no coverage for liquor liability under the policy. But is it completely excluded? Host Liquor Liability You may have heard this term before “host liquor liability”. Does it exist, or is it some mythical creature dreamed up by someone under the influence? It does exist, sort of, but you usually won’t see the words “host liquor liability” on your policy. In fact, the whole premise of host liquor liability is based on the “give back” in the exclusion above. Here is how that looks:...