General Liability

General Liability Insurance helps cover the costs of liability claims made against your business for third party personal injury, third party property damage and advertising injury. For example, if a customer slips and falls at your place of business, they could make a claim against your company. Did you know that the average cost of a slip and fall claim is $20,000? Without General Liability Insurance your company may have to pay all the costs related to settling such a claim from your own business and personal assets.

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Most Common Coverages

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 with higher alcohol to food ratios also have significant exposure to assault and battery claims from either employees being overly rough with patrons or patrons assaulting other patrons.

Third Party Bodily Injury

A person may make a bodily injury claim against your business if he injures himself on your business property. For example, a customer is walking through your bar and slips on a spilled drink. He falls and breaks his arm. The customer could make a claim against your business for bodily injury. General Liability Insurance for businesses can help cover the costs of this claim.

Advertising Injury

General Liability can help cover the costs of claims made against your business for advertising injury. For example, one of your ads has music playing in the background. The artist who owns the rights to that music makes a claim against your business for copyright infringement. General Liability Insurance can help cover the costs of the claim made against your business.

Products & Completed Operations Injury

If your company sells a product, your bar could be the subject of a product liability claim. It means that someone could file a claim against you alleging that a product you made or sold is defective, causing injury to that party or damaging his or her property. For example a patron that ordered food at your establishment ended up going to the emergency room for an allergic reaction to peanuts. Products & Completed Operations Insurance can help cover the costs of the claim made against your business.

Property Damage Liability

One of your employees is pressure washing the walkway right outside your establishment and the force caused rocks and debris to damage a customer’s car parked right out front. Having property damage liability due to your employee’s negligence can help cover the costs of a claim made against your business.

Contributing Factors to General Liability Pricing

Sales Ratio

Generally the higher the percentage of alcohol sales related to food sales, the higher the premium and the more likely a carrier going to put a sub-limit on assault & battery coverage.

Type Of Risk

A tavern open from 7am-2am is more likely to pay less a year on their insurance versus a nightclub open 4 days a week open from 10pm-2am. Nightclubs in most cases have no food sales. The higher the alcohol sales the more likely there could be an assault & battery claim.

Entertainment

Pool tables, dart board, live bands, karaoke, DJ’s and a dance floor are all factors into calculating the premium. The less entertainment offered historically speaking, the lower the premium tends to be.

Years In Business

If you are new in business, your premium will tend to be slightly higher than a risk that has a clean loss history with multiple years in business. Having management/ownership experience can help keep the premiums lower.

Loss History

Almost 99% of the time a risk that has 0 claims the last 3 years will pay less than one that has a claim. It is important that if you have had one, that you make sure all the steps in place to prevent that incident from happening again.

Does the venue do background checks on employees, especially bouncers/security?
What training does the serving staff undergo?
Does the venue allow minors? If so, what are the control procedures?
Are there security cameras?
What is the procedure for dealing with intoxicated patrons?

In short, general liability is a complex coverage that is becoming harder and harder to procure, but with a proper insurance broker, you can effectively get the correct coverage for your risk.