Does My Business Need Liquor Liability Insurance?

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You’ve heard those crazy stories of bartenders getting sued for overserving people alcohol, right? They’re pretty hard to believe, especially when you work in the liquor industry. You might think there’s no way that could happen to you, but that’s probably what those bartenders and restaurant owners thought, too.

Without the aid of insurance, you could be liable. to pay hundreds of thousands of dollars if you were to over-serve alcohol to a patron who later caused someone else bodily harm or property damage. Many businesses are confused about Liquor Liability Insurance., but Insurance Canopy is here to help. We’ll explain what Liquor Liability Insurance is, why you need it, and where you can get it.

Let’s get started.


Liquor Liability Insurance, also known as Dram Shop Insurance, is designed to protect you against third-party claims that you serving alcohol to a minor or clearly intoxicated individual caused someone or something harm. It protects you if you are sued and could help cover the costs of legal aid, court filings, and other associated fees.


The need for liquor liability insurance has become more prevalent in recent years. Here are just a few dram shop law cases that have made headlines.

  • This lawsuit was settled for $4.4 million when lawyers determined the intoxicated individual and the bar who served her were at fault for causing the a brain injury in a child
  • In 2019, a dram shop lawsuit involving the death of a police officer was settled for $2 million after a Florida tavern was found at fault for over serving an individual
  • Lawyers in California secured a $1 million settlement after a restaurant patron drunkenly caused a death while driving under the influence

Would you be able to handle any one of these lawsuits on your own? With the help of liquor liability insurance you would have the tools necessary to face similar situations.


Liquor Liability Insurance has long been referred to as dram shop insurance. The term “dram,” comes from colonial times when a unit of liquid was called a “dram” and a tavern or bar, where individuals purchased alcohol, was called a “dram shop.”

Many states have dram shop laws in place that can hold alcohol servers and even social event hosts liable if a drunk driver or minor were to get into an accident. When a bartender or server is sued, the entire establishment can be named and you’d be glad you had liquor liability insurance. The same goes for scenarios in which you host an event where you serve alcohol and someone at your event gets into an accident and causes damage.


Currently, bartenders, restaurant owners, and other liquor-serving hosts can be held liable for illegally serving alcohol to minors or over intoxicated individuals in 43 states, including the District of Columbia.

Check out this list to see what laws are applicable in your state.


If your business sells, services, or helps provide alcohol to consumers, you need Liquor Liability Insurance coverage. You also need liquor liability insurance if you’re someone who hosts large social gatherings where you’re providing the alcohol, as dram shop laws can extend to you as well.


With Insurance Canopy, liquor liability coverage starts at $35.42 per month. Our policy protects you if you’re sued as a result of property damage or bodily injury caused by an intoxicated person, an accident involving a patron you served, or if a drunken fight in your establishment sends someone to the hospital.


The time to insure your business is now! If your business handles or serves alcohol in any capacity, or if you’re someone who hosts social events where alcohol is served then you need liquor liability insurance.

Liquor liability insurance from Insurance is customizable and available to social event hosts, bartenders, brewery or restaurant owners, and other businesses who serve alcohol. You face any risks when uninsured and need to place the proper safeguards to ensure your business’ success. To learn more about liquor liability insurance, visit Insurance Canopy.

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