Alcohol sales are an important part of the hospitality landscape, with alcohol-serving restaurants reporting far greater profit margins. The challenges in obtaining a liquor license are more than overcome by the financial benefits associated with liquor sales. Owners need to understand, however, that restaurants and food service operations that serve alcohol face unique liability risks. Utah restaurant insurance is only one part of a broad risk management strategy; understanding the factors associated with liquor liability can help to protect your operation’s financial assets.
Risks Associated with Liquor Sales
Utah restaurant insurance, specifically those policies that offer liquor liability coverage, help to provide financial protection against the liability claims associated with alcohol sales. Restaurant owners facing legal claims against an establishment that sold alcohol to someone who was later hurt or caused property damage can be financially devastating without this critical insurance coverage. Common alcohol-related risks include:
- Serving alcohol to a patron who later gets into his or her car and is involved in a collision.
- Claims of serving alcohol to patrons who are already visibly intoxicated.
- Restaurant guests who become injured on the premises or when leaving the establishment who claim their intoxication was a factor in the injury.
- Intoxicated patrons starting a fight or altercation that leads to property damage or personal injury of another.
- Claims of serving underaged individuals.
- Incidents caused by employees drinking on the job.
In Utah, food service establishments may not be fully covered by their Utah restaurant insurance or general liability policies. In these cases, specialized liquor liability insurance is of the utmost importance.
Dram Shop Laws
Most states in the U.S. have regulations known as “dram shop laws” that can result in your restaurant business being liable for injuries, property damage, or death if a patron is served alcohol by your establishment. In the state of Utah, restaurant owners can be held liable for the actions of an intoxicated person if that restaurant provides alcohol, and that individual was visibly intoxicated. Under a dram shop claim, a patron can seek damages against a restaurant for financial losses like:
- Medical expenses
- Lost wages
- Pain and suffering
- Property damage or loss
- Legal expenses
- Financial penalties resulting from an incident related to the purchase or consumption of alcohol on restaurant premises.
Liquor liability insurance provides comprehensive protection against these claims, protecting restaurant owners, their staff, and their financial assets. This insurance supplements Utah restaurant insurance or may be added as an endorsement to a general or restaurant liability policy. It may also be obtained as a standalone policy in many cases. In some states, restaurant owners are required to obtain liquor liability insurance as part of the alcohol sales/service licensing process. In simple terms, restaurant owners that serve, manufacture, or sell alcohol as part of their operations need the valuable coverage provided by liquor liability insurance.
About BTC Insurance Services
Founded in 2011, BTC Insurance Services has proudly served Utah businesses with comprehensive and custom-tailored insurance coverages for a decade. We pride ourselves on fostering long-term client relationships with a personalized and hands-on approach, and have established a reputation built on quality and transparency. For more information about our products and services, we invite you to contact one of our reputable agents today at (855) 944-3457, or send us a message here.
