Alcohol Related Accidents and Insurance

Regards to drinking related accidents and insurance, there are two major kinds of policies. First, Liquor Liability Insurance for stores or restaurant owners who serve alcohol. Second, SR-22 filing in an auto insurance for those who have DUI.

According to statistics from the U.S. Department of Transportation, there are about 16,000 accidents involving drunk driving.
Despite the high number of deaths and property loss in alcohol related accidents, many restaurants and businesses that serve or sell alcohol still seem to be unaware of the need for Liquor Liability Insurance. A business owner in LA was sued for selling alcohol to a minor who ended up in an auto accident. The business owner was held responsible and was ordered to pay $1 million in compensation.

The “Dram Shop” states that bars and restaurants can be held accountable if they serve alcohol to a minor or visibly intoxicated customer who causes an accident and harms others. According to a recent report by the Texas Restaurant Association, only 135 restaurants, or 45% of the 300 restaurants surveyed, had Liquor Liability Insurance. Considering that the survey was based on large-scale restaurants affiliated with the Restaurant Association, it would be no surprise to find small restaurants that sell alcohol overlooking the risk of liquor liability.

Insurance is all about establishing a reliable foundation for your business by preparing for accidents before they happen. Even with new restaurants and liquor stores on the rise, many seem to be unfamiliar of the type of protection that liquor liability provides and underestimate the importance obtaining one.

Liquor Liability is a type of business insurance that provides coverage for business that sell, serve or distribute alcohol.  It can help cover third party bodily injury and property damage that an intoxicated person causes after you sold or served alcohol. Examples of such accidents are DUI and assault and battery.

Businesses that need Liquor Liability Insurance include liquor wholesalers, restaurants, bars, taverns, nightclubs, entertainment establishments, convenience stores, beer specialty stores, and wine specialty stores. For small businesses, Liquor Liability coverage is usually available as an endorsement that you can add on to your current business general liability and property insurance. As for large-scale restaurants and beer wine stores, a separate Liquor Liability insurance plan can be purchased.  Most Liquor Liability Insurance covers $300,000 to $2,000,000 per case.

Another insurance term associated with alcohol related accidents is SR-22. If you receive a ticket or have an accident due to drunk driving, you will be asked to file an SR-22 from the DMV or another institution. Also known as “Certificate of Financial Responsibility” an SR-22 proves that you have auto coverage that meets the minimum limits required by state law. This document cannot be issued by an insurance agency and can only be issued by insurance companies recognized by the state. In case the insured cancels or no renews their auto policy, the insurance company that filed the SR-22 must immediately report a SR-26 to the DMV. Which will then be followed with the suspension of your driver’s license or fines.