Whether you’re hosting a holiday party or a get-together with friends, you’re probably missing one thing: insurance! This is especially true if you’re having some drinks. Serving alcohol to a group of people comes with several liabilities. In this blog, we will discuss everything you need to know about host liquor liability and how to stay safe.
What is host liquor liability?
Host liquor liability, often called social host liability, is an insurance policy that protects you against alcohol consumption-related claims when hosting an event. When you host an event, you are responsible and liable for your guests. This is true whenever you provide or condone alcohol consumption on your property or location rented under your name. At this time, you are considered a “social host” by law.
It’s important to be aware of this when you’re hosting any events in the near future. Before you do so, you should look into purchasing a host liquor liability policy for the following events:
- Wedding
- Birthday party
- Holiday party
- Corporate event
- Stag and doe
- Charity event
- Family reunion
- Potluck or barbecue
- Open house
- Banquet
If you are hosting any type of private event, you’ll need host liquor liability insurance. Playing the role of host for social events can be fun. Despite this, when you serve alcohol, you are taking on the additional responsibility of keeping your guests safe. Neglecting to look after your guests can result in hefty legal expenses, but how do you know if you have the right insurance policy for your needs? Liquor liability insurance also exists — we will explore the differences between it and host liquor liability insurance next.
What is the difference between host liquor liability insurance and liquor liability insurance?
Host liquor liability insurance and liquor liability insurance are the same, right? Actually, this isn’t the case. Despite their similar names, they serve different purposes.
Host liquor liability insurance covers if you are personally hosting an event or are hosting an event for your business where you are serving alcohol. This type of coverage doesn’t apply if you are a business selling alcohol to your customers. When you’re doing this, you need a separate type of coverage.
If you own a business and serve alcohol to your customers during your operating hours, such as a cafe serving wine for an event, liquor liability insurance is what you need. Similar to its counterpart, it provides coverage for bodily injury or property damage that occurs as a result of alcohol consumption. However, it applies every day instead of only when you’re hosting an event.
These two types of insurance coverage are not the same. You need both to serve alcoholic beverages and to reduce the financial burden if something does happen to someone as a result of alcohol consumption. It’s important to note that both are considered a type of additional coverage and you have to purchase them before your event so you aren’t found liable for damages. Now that you know the difference, you might wonder what host liquor liability covers. We’ll explore this next.
What is covered under a host liquor liability policy?
Generally, host liquor liability will cover you if someone makes a claim of personal injury or property damage while consuming alcoholic beverages at your event. Depending on your insurance company and policy, you will be covered for any or all of the following:
- Legal expenses, including attorney fees, if a lawsuit is filed
- The cost of damages if the court finds you to be the liable party
- Settlements, if you and/or the other party decide to settle outside of court
Remember, like other types of insurance claims, you will be partially held responsible. In this case, since alcohol is a contributing factor, this type of event insurance applies to specific incidents. It’s essential to be aware of this because drinking and alcohol-related incidents can cause serious damage if you let them happen. To avoid paying for damages caused by intoxicated guests out of pocket, you’ll need a proper insurance policy. Are these events covered by an existing policy? Keep reading to find out.
Is host liquor liability already covered under any of my existing policies?
Depending on where and why you are hosting your event and what policies you have, you may already be covered for host liquor liability.
If you’re hosting a larger event as a business owner (e.g., a holiday party for employees or a work fundraiser), your commercial general liability policy may include coverage for larger events. Contact your insurance company or broker before the event to confirm. Your insurance company has to know when you host an event and serve alcohol.
In contrast, if you are hosting an event as an individual at your home or a rental location such as a banquet hall, you might have to purchase your own host liquor liability policy. Many venues require you to purchase your own policy to rent their space—your home insurance policy won’t provide coverage for larger-scale events either.
Always ensure anyone serving alcohol at your event in Ontario has Smart Serve. A Smart Serve course teaches people how to recognize signs of intoxication and encourages smart and responsible behaviour around alcohol.
In the end, whether you already have coverage depends on whether you are a business or an individual hosting an event. For example, a company picnic might already be covered, and your personal house party might not. Reach out to your insurance company or broker to confirm if you need to purchase additional coverage before your event. It’s better to be safe than sorry. This might make you wonder how much coverage costs—we will explore this next.
How much does host liquor liability coverage cost?
Similar to any other insurance policy, the cost of liquor liability insurance coverage will vary depending on the person and situation. Rates are based on various factors, including:
- The type of event you are hosting
- Where you are hosting your event
- How many guests are in attendance
- The age of the guests attending
There isn’t a one-size-fits-all price for host liquor liability coverage. Despite this, you need to give your insurance provider as many details as you can about your event to ensure a policy is in place beforehand. It’s a way to protect employees if your event is for work and to get everyone home safely. These are a couple of other reasons to get an insurance policy before you host an event. We will go more into depth about this in the following section.
Why do I need host liquor liability insurance?
If you are hosting an event and serving alcoholic beverages, you are responsible for ensuring nothing happens to your guests as a result of alcohol consumption. That means you have a big job if you are hosting an event with a large number of guests. When your guests consume alcohol, it’s your job to keep track of them. In other words, it’s more difficult to party safely because the risk of an accident is much higher. Always have a backup plan, such as hiring designated drivers and knowing when to stop serving alcohol.
It doesn’t matter if you’re a business or an individual hosting an event. If someone gets intoxicated at your event and causes damage to the rented space or after they leave the premises, you, as the host, will be held liable. This isn’t something everyone realizes because there’s often the assumption that you aren’t responsible for the actions of others once they leave. In other words, you have to be extra careful, so keep reading to learn about ways to prevent making an insurance claim next.
How can I prevent making a host liquor liability claim?
If you don’t have a host liquor liability policy, you are taking a risk — purchasing one before your event is important. If you want to avoid making an insurance claim, plan ahead and think of ways to prevent any alcohol-related claims from being filed in the first place. Here are some tips to eliminate and lessen alcohol-based risks:
Have transportation options available
Identify designated drivers upon arrival. Limit their consumption to one drink at most, or do not serve them alcohol at all. Remember that no-fault insurance doesn’t apply when someone is impaired, and share some of our safe driving tips with those driving. You should also remember to have extra cash on hand for taxi and ride-share services. If you are hosting at your home, offer for your guests to stay the night.
Ensure staff are trained
Hiring event staff isn’t uncommon if you have many guests attending your event. That’s why it’s important to know that the people serving alcohol at your event have proper training. This means having a Smart Serve certification in Ontario or the provincial equivalent.
Have food and other drinks available
Offer a wide range of food and non-alcoholic beverages to your guests. By giving your guests something to eat, you can slow alcohol consumption and reduce the chances of intoxication, making your event safer for everyone attending.
Set a limit
Having a few drinks is fine and fun, but limiting how many drinks everyone can have can be helpful. Also, stop serving alcohol at least one hour before the end of your event or when you anticipate guests will be leaving. Start offering tea, coffee or water instead.
Keep an eye on your guests
You shouldn’t let anyone get behind the wheel while intoxicated. After all, as the host, you will be held responsible if someone is involved in an accident after your event. Even third-party liability insurance, accident benefits coverage, and uninsured automobile coverage won’t come into effect when the driver is impaired. If one of your guests is intoxicated, don’t hesitate to ask for their keys.
All you can do is supervise your guests and take as many preventative measures as possible to stop them from damaging property or causing bodily injury. Hosting an event isn’t something you take lightly because it’s a position that comes with a decent amount of responsibility. If you aren’t careful, you could face a lawsuit as a result of intoxication. Next, we will discuss what host liquor liability insurance doesn’t cover.
Does host liquor liability insurance have any exclusions?
Like other types of insurance policies, host liquor liability insurance does come with exclusions. You should reach out to your insurance company to find out if your policy has any terms and conditions. With that said, there are certain restrictions that always apply, which we will discuss below.
When you are hosting an event, you cannot violate provincial liquor laws. This includes serving alcohol to minors because it is illegal. If caught, you can get fines or jail time even if no incident occurs. Host liquor liability insurance won’t provide coverage for such situations.
The other situation for which you won’t get coverage is when you violate any other local liquor laws. Be sure to read up on these before you host your event to avoid having issues with receiving insurance coverage. If you don’t, you’ll be stuck paying the price out of pocket.
Hosting an event in your home is a convenient option to have — just remember to comply with local laws to maintain your coverage. It’s not as common of a practice for businesses because having an event at the office will likely be covered by their insurance policy. However, as an individual, you have to be careful to prevent damage. To keep your home safe from damage, you can check out our home protection tips.
Need insurance? You’ve come to the right place!
When you’re caught up in planning an event, it’s easy to get hung up on the details. That’s why you’ll likely need some guidance when it comes to purchasing an insurance plan. This will put your mind at ease and keep all your guests safe.
Purchasing the right insurance policy for your needs can be challenging. However, if you choose a BrokerLink broker, we will do all the work for you. Your broker will compare quotes from various insurance companies to get you the best price and a policy that suits your specific wants and needs.
To speak with a BrokerLink broker, please call us at one of our locations.
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