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AmWINS is a leading specialty insurance distributor of personal lines products that excels in helping our retail agents and brokers find the right coverage at competitive rates for personal lines accounts of all values and sizes.
As the largest wholesale broker in the U.S., we are uniquely positioned to provide access to best-in-class and exclusive personal lines markets to help differentiate our retail partners. With both admitted and non-admitted markets, as well as national and international carriers, we competitively place risks that can be written as either standalone coverage, or part of a more comprehensive package policy.
Our local underwriters are solely focused on personal lines. We understand the importance of time sensitivity, active communication, and working with our retail partners to find solutions for those harder to place risks and hard to satisfy clients. With dedicated personal lines underwriters across the U.S., our experienced underwriting team has an average industry experience exceeding 10 years.
We can help you insure everything including luxury homes, vacation homes and rentals, vacant homes, condos, valuable articles, autos/collector cars, and recreational marine vehicles. We provide coverage for all types of perils including wind, fire, earthquake, and flood, as well as comprehensive personal liability / umbrella protection to cover your assets.
It’s no secret that liquor liability is a complex coverage. There are numerous variables that underwriters take into consideration when pricing and structuring a policy. The more informed you are about the underwriting thought process for liquor liability risks, the better able you are to position your clients for optimal terms and pricing.
There are several variables to the complexity of liquor liability. First, there are 50 states with 50 different sets of laws governing liquor liability, ranging from strict liability (Alabama) to very little liability (Nevada). Second, there is a wide range of venue types – from restaurants to nightclubs to concerts – which all have specific nuances that need to be addressed. Finally, each specific location has its own unique underwriting concerns that will arise, and it is critical to address them fully when submitting a risk to market.
The principal idea of liquor liability insurance is to protect a licensed purveyor of alcoholic beverages from third party liability. Liabilities for these establishments share some common characteristics. Typically, liability arises when a venue over-serves, serves minors, serves a known drunk, or serves an individual who is involved in a drunk driving incident after he or she was served on premises. Venues also have significant exposure to assault and battery claims from either employees being overly rough with patrons or patrons assaulting other patrons.
There are a host of different factors that go into the rating and pricing of this coverage.
1. Type of Venue
The most basic way of looking at risk factors for different venues is simply to identify what the primary purpose of the venue is – whether it is a restaurant, bar/tavern, nightclub, concert, and so on. If a restaurant’s primary purpose is serving food in a sit-down environment, it is considered to be much less risky than a nightclub with a primary purpose of entertainment and dancing. A bar/tavern may provide a mix of both, which places its risk factor in between a restaurant and a nightclub. Other venues that need a liquor liability policy are concerts, special events, country clubs, and fraternal organizations – essentially, anyone who is charging the general public for liquor.
2. Location of venue
State liquor laws vary dramatically by venue and jurisdiction. States each have their own basic scoring system based on the punitive nature of their dram shop law. Simply put, dram shop laws are laws that impose certain liability standards on the venues that serve alcohol. Tough jurisdictions, such as District of Columbia or Alabama, impose the toughest standards on venues when it comes to proving that they didn’t contribute to a third party bodily injury or property damage claim. Other jurisdictions, such as Nevada or Delaware, are more favorable to venues, and it is very difficult to prove the venue contributed to negligence. It is important to understand the varying dram shop laws associated with each venue as it will better help gauge the customer’s expectations and ability to find adequate coverage.
Individual traits of the risk: What controls are in place? How the operation is run by management?
3. Percentage of liquor sales
Further complicating the realm of liquor liability coverage is the percentage of the alcohol sales; as would be expected, more liquor sales equate to higher premiums. A restaurant with a high percentage of alcohol sales may be classified as more of a bar. A bar with a dance floor plus high liquor sales may be classified as a nightclub. When submitting a risk for liquor liability coverage, it’s important to review the specifics so you know what to expect from underwriters.
4. Individual traits of the risk
Below are some additional variables which underwriters will take into consideration.
In short, liquor liability is a complex coverage that is becoming harder and harder to procure, but with a proper understanding of the type of risk, venue and location, you can more effectively position your client for success with underwriters.
This article was authored by Brian Davidian, leader of AmWINS' national Hospitality practice.