Drunk driving remains a serious public safety problem. The National Highway Traffic Safety Administration (NHTSA) reports that an average of 32 people nationwide die in DUI accidents on a daily basis. The Foundation for Advancing Alcohol Responsibility reports that Florida has a DUI collision rate even higher than the national average.
Drunk driving is a criminal offense. The intoxicated driver bears liability. That being said, other parties—including those that sell or provide alcohol—could also be legally responsible. Insurance coverage mitigates the risk. Here, you will find a comprehensive account of what to know about dram shop laws and liquor liability and insurance in Florida.
What Is Liquor Liability Coverage?
Liquor liability coverage is insurance that protects businesses that sell, serve, or otherwise furnish alcohol from the inherent risks associated with doing so. While the specific terms of a policy always matter, a liquor liability insurance plan can cover a company against bodily injury claims, property damage claims, and the legal costs associated with navigating the settlement process. Some businesses obtain liquor liability coverage as part of a more general, comprehensive insurance policy. Other businesses get their liquor liability coverage from a single, standalone insurance policy.
What Risks Does Liquor Liability Insurance Coverage Mitigate?
Liquor liability coverage can apply to a wide range of common risks that are inherently linked to serving alcohol to patrons/customers. In Florida, a liquor liability policy obtained by a bar, restaurant, event space, store, or other business may cover:
- Assault & Battery: The data is clear: Alcohol consumption is linked to aggression and even violence. As explained by American Addiction Centers, intoxicated people are more likely to end up in a physical altercation. Liquor liability insurance coverage limits the risks a business faces from an assault or battery claim.
- Intoxicated Driving: In Florida, a third party can sometimes be held liable for a DUI accident through a dram shop (commercial establishment that sells alcoholic beverages) lawsuit. Liquor liability coverage can protect businesses against the risk of a dram shop claim after a patron or customer is involved in a DUI crash.
- Property Damage: An intoxicated individual may cause property damage in their inebriated state. A liquor liability policy can protect a business from being held liable for this type of loss.
Understanding Dram Shop Laws
As defined by the Legal Information Institute, a dram shop is a “commercial establishment that sells alcoholic beverages.” Dram shop regulations are legal statutes or common law rules that hold that such a commercial establishment can be held liable for certain accidents—and other incidents—that happen because an intoxicated customer/patron acts in a negligent, reckless, or criminal manner.
In other words, a dram shop law holds that a third-party business—such as a bar—can potentially be held civilly liable for damages caused by a drunk patron or customer. For example, if someone gets drunk at a bar, drives their car while intoxicated, and crashes into an innocent person, the bar may potentially be legally responsible for the damages through a dram shop law claim. Dram shop laws are not solely restricted to car crashes. A business may also bear liability for other negligent conduct by intoxicated patrons—such as a physical assault.
What are the States that Have Dram Shop Laws?
The majority of U.S. states have dram shop laws in place. The key thing to remember about these laws is that they make a commercial establishment that provides alcoholic beverages—bars, clubs, restaurants, event spaces, stores, wineries, breweries, etc.—potentially liable for harm caused by their client. In some cases, social hosts—non-commercial entities—can also be held liable for a dram shop claim.
Dram shop law claims are notoriously complex. These vary significantly from state to state. Some jurisdictions make it far easier than others for a dram shop (a commercial establishment that sells alcoholic beverages) to be held liable for the negligence of its customers or patrons. It is imperative that you look up the dram shop rules in your specific jurisdiction.
How is Florida’s Dram Shop Liability Law Different?
Florida’s dram shop laws are somewhat more narrow than the dram shop laws in many other states. In many jurisdictions, a commercial establishment that sells or provides alcohol can be legally liable if they serve a visibly intoxicated person and that person goes on to cause damage. That is not how the standard works in Florida. Under Florida law (Florida Statutes § 768.125), any party who sells or furnishes alcoholic beverages is actually presumed not to be legally liable for the conduct of patrons. However, there are two significant exceptions to Florida’s dram shop rule:
- Any business or other party that sells or furnishes alcohol to a person who is not of the legal drinking age (under 21) can be held liable through a dram shop law claim; and
- Any business or other party that sells or furnishes alcoholic beverages to a person they know is habitually addicted to alcohol can be held liable through a dram shop law claim.
For example, imagine that a bar in Fort Lauderdale fails to check the identification of its customers. A 19-year-old is able to purchase and consume a large amount of alcohol. The underage person drives home and injures someone else in a pedestrian collision. Under Florida law, that bar can be held legally responsible for the pedestrian’s injuries through a dram shop law claim.
What is the Cost of Liquor Liability Coverage?
The cost of liquor liability insurance in Florida depends on a wide range of different factors. A key factor is the total percentage of your revenue that comes from alcohol sales. Generally, the more alcohol is provided, the higher the cost of coverage. Other factors matter as well, including the policy limit of the insurance plan.
Can I Save Money On Liquor Liability Coverage?
There are often a number of different strategies that businesses can use to save money on their liquor liability insurance coverage. To start, you may be in a position to bundle policies together to get a reduced rate. Some insurance carriers often reduce premiums when policyholders (businesses) put certain practices in place, such as additional training for staff.
Do I Need Alcohol-Related Liability Insurance?
All businesses that sell or furnish alcoholic beverages in Florida can benefit from obtaining the proper liquor liability coverage. Some examples of companies that can benefit include bars, restaurants, nightclubs, event spaces, catering companies, and grocery stores. Ultimately, a business’s coverage needs will always depend on its specific circumstances. It is important to understand and evaluate the risks facing your business to ensure that you have the appropriate liquor liability insurance coverage in place.
Should Liquor Stores Have this Type of Liability Coverage?
Yes—at least in Florida. Some states have specialized provisions and protection in place for liquor stores. For example, in Missouri, it is very difficult to bring a dram shop law claim against a liquor store. However, Florida is not one of these states. In Florida, liquor stores are not treated differently than other types of businesses that sell or furnish alcohol, such as bars or restaurants. In fact, a liquor store may even face heightened liability risk as they are more likely to be in a position to “know” that a person is habitually addicted to alcohol. The bottom line: Liquor stores operating in South Florida can benefit from the financial and legal protections offered by liquor liability coverage.
What to Know About the Mitigation of Liquor Liability Risk?
Mitigation of liquor liability risk is a term that refers to the strategies that businesses can develop and implement to reduce the chances that they will run into legal or financial problems. Here are some of the top liquor liability risk mitigation strategies:
- Develop written procedures. Businesses that have written policies that are legally compliant are in a better position to avoid liability from a dram shop law claim.
- Ensure that all employees are properly trained. In Florida, businesses need to be especially proactive about not selling or furnishing alcohol to underage individuals.
- Obtain the proper insurance coverage. Businesses that have adequate liquor liability insurance coverage are far better protected from financial risks.
Is Host Liability Insurance Distinct From Liquor Liability Insurance?
Yes. The term “host liability insurance” is different than “liquor liability insurance.” However, both types of insurance coverage are broadly related to alcohol. As noted previously, a liquor liability policy is a specialized type of insurance coverage for companies that sell or otherwise furnish alcohol as part of the normal course of their business operations. This includes everything from a bar that makes 100% of its revenue on alcohol sales to a restaurant that makes 20% of its revenue on alcohol sales.
In contrast, host liability insurance is a form of alcohol-related insurance coverage for businesses that do not actually sell or provide alcohol in the ordinary course of their operations. As an example, imagine that a financial services company wants to have a holiday party. At the party, alcoholic beverages will be provided. This business needs host liability coverage. While it is not in the “liquor business,” it is only alcohol consumption on its premises at an event. Host liability insurance will protect it against the risks associated with someone underage or habitually addicted to alcohol causing harm after drinking at the party.
Will a General Liability Policy Cover Liquor Liability Risks?
No—at least not typically. Every business in Florida needs the proper general liability insurance coverage. You should carefully read and review the terms of your general liability policy to determine what risks are and what risks are not covered. Notably, general liability policies offered by commercial insurance companies in Florida almost invariably exclude liquor liability coverage if the policyholder (business) sells or otherwise furnishes alcohol.
A business needs to obtain a specific liquor liability insurance policy. In some cases, that policy can be added on as an additional form of coverage from the same insurer that provided the general business liability policy. In other cases, a South Florida business may wish to get a stand-alone liquor liability insurance policy. Regardless, all companies that sell or otherwise furnish alcohol in Florida need the proper insurance coverage for their specific business operation.
Why Hire BK Law in a Liquor Liability Case?
Bernheim Kelley Battista & Bliss, LLC is a law firm devoted to helping clients get real justice and real results. We put time, resources, and attention into the smallest of details for every case that we take on. Our Florida attorneys have experience with auto accident claims, personal injury claims, and insurance coverage matters, including first-party coverage disputes. No matter the nature of your liquor liability case, we are here to help determine the proper course of action. Your rights and your interests matter. You do not have to navigate the complexities of liquor liability coverage and the insurance claims process yourself.
Schedule a Confidential Consultation With Our Liquor Liability Attorneys Today
At Bernheim Kelley Battista & Bliss, LLC, our Florida lawyers provide personalized, solutions-driven guidance and support to clients. If you have any specific questions or concerns about dram shop laws in Florida or liquor liability coverage more generally, we can help. Give us a call now or connect with us online to set up a confidential, no-obligation initial appointment with an attorney.