Liquor Liability: Is Your Event Covered?


Festivals, concerts, and events almost always have some bar or alcohol station for guests. Patrons expect to have the option to buy alcohol, so venue operators need to prepare for the risks and dangers that come with serving alcohol.

One of the biggest liability risks that come with serving alcohol is overserving. If a patron at your event is over-served, then drives drunk, and ends up killing or severely hurting someone, you could be held liable. The costs can be hundreds of thousands of dollars or much more if a death is involved.  

Another significant liability issue with the same risk is serving minors.  If minors consume alcohol at your event, then later cause an accident, you could be held liable. They do not need to be over-served; the issue here would be their age. This risk can be tough to control with the common use of fake IDs and patrons sharing drinks.  

Understanding dram shop laws

Dram shop laws originated in 18th Century England, where establishments sold gin by the spoonful or using a “dram.” Dram shop laws govern lawsuits over injuries or deaths caused by people who purchased or were served alcohol from any business.

Every state in the U.S. has dram shop laws. Through dram shop laws, third-party victims of dangerous or drunken behavior can file civil lawsuits against establishments, store clerks, or wait staff that sold alcohol to a minor or intoxicated patron.  

Managing alcohol at your event

There are a lot of proactive strategies you can use to manage alcohol at your event. The essential thing to do is hire properly trained security. An event security team can handle ID checks, control access, and deal with violent individuals. Just the presence of a security team can change unruly behavior. Make sure the security team you hire is fully licensed and trained to deal with events that serve alcohol.

It’s critical to properly train employees on how to identify a minor or an intoxicated person.  However, even the best-trained employee can make mistakes when an event gets busy, and lines are long.

Additional tips include:

  • Hire professional bartenders: Professionally trained bartenders will know how to recognize intoxicated individuals and not over-pour alcohol.
  • Have alternative transportation in place for anyone who has had too much to drink.
  • Limit the number of drinks that any one individual can have.
  • Institute a drink ticket system whereby each adult is issued or sold tickets setting the maximum amount for alcoholic beverages served at the event.
  • Limit the number of hours that the bar is open.
  • Follow state and local guidelines on serving.
  • Make sure to have all proper permits and licenses.

Why liquor liability insurance is essential

The bottom line is if you’re going to serve alcohol at any event or venue, you need liquor liability insurance. This type of coverage protects you in all of the following scenarios:

  • Your employees serve or sell alcohol to a minor.
  • Your employee serves an adult too much alcohol.
  • Your employees consume alcohol while working.
  • Your employees or guests damage property.
  • An intoxicated person is involved in an accident.
  • An intoxicated person injures another person. 
  • An intoxicated person leaves the event, drives drunk, and causes an accident.

Even when you have a well-trained staff, there is always a chance for things to go wrong when alcohol is involved. Special event coverage is designed specifically for the amusement and entertainment industry. It considers things like rented and owned equipment, third-party property damage, general, excess and automobile liability, and liquor liability. 

McGowan Allied Specialty Insurance brings more than 35 years of expertise in risk management solely in the amusement and entertainment industry. 

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