Bartending can be profitable, but it can also be risky. If a customer becomes intoxicated, then has an accident, you could end up facing a lawsuit. If you're an employee at a bar, the bar's insurance may protect you. If you work as a private bartender, you'll have to pay for your own bartender insurance.
TL;DR (Too Long; Didn't Read)
To buy bartender insurance, talk to other private bartenders about their coverage. Your regular insurer may offer a policy, or suggest an insurer that will.
Insurance for Private Bartending
A mobile or private bartender is a freelancer. They hire themselves out to catering companies, event planners and wedding planners who need someone to serve drinks for a one-time event. Private bartenders also work in hotels and bars when someone's sick and the bar needs a pinch-hitter.
As a private bartender, you're a one-person business, responsible for your own insurance coverage. Your customer may have the best event insurance but they'll still expect you to have liquor liability coverage of your own.
Understanding Dramshop Laws
Under the "dramshop laws" in many states, bars and bartenders may be legally liable if an accident can be blamed on them serving a customer too much alcohol. First-party dramshop cases involve customers who drink too much, then have or cause an accident. Some states don't allow these lawsuits under the assumption your customer should have known better than to drink more than they could handle.
In a third-party case, the party suing you is the victim of the drinker: their car was hit, they were hit, the drunk person assaulted them or crashed into their house. To win in court, the plaintiff typically has to show that the damages trace back to the first party's alcohol consumption and that you were negligent in not cutting your customer off. If the customer is underage, though, you're in serious trouble under any circumstances.
Your exact legal liability varies with the situation and with the laws of your state. Even if the plaintiff has no case, you could end up spending a lot of time and money defeating the lawsuit. If you lose, you may have to pay fines or damages or lose your bartending license.
What Bartender Insurance Does
Liquor liability insurance, also known as bartender insurance or mobile bar insurance, covers your expenses if you're sued. Depending on the policy and the circumstances, that may include legal fees, settlements, medical costs and damages. Coverage can run up to several hundred thousand dollars or even over $1 million, if you need and can afford it.
Read over the policy so you know what exemptions in coverage it may have.
- A given policy may not apply if you're working in some states.
- Some policies exempt drinking games, two-for-one specials, all-you-can-drink specials or anything else that encourages excessive drinking.
- Some insurers are cautious about covering private events. That's because it may not be as easy to cut off access when a guest's had too much.
Buying Bartender Insurance
If you want liquor liability coverage, you can find multiple companies online that offer policies. You can also talk to your regular insurer or business insurer about coverage. Even if they don't sell it, the agent may be able to suggest a trustworthy company that does. Your fellow mixologists may be able to recommend the bartender insurance coverage they use.
Exercise sensible business judgment before signing the policy:
- Shop around. Getting two or three quotes from different insurers is better than going with the first offer.
- Assess how much coverage you need and how big a premium and a deductible you can afford.
- Read the policy over. If you don't understand some of the clauses, ask for an explanation.
These rules apply to any sort of business coverage you buy, such as a general liability policy.
Playing It Safe
Even after you take out bartender insurance, it's better not be sued. For instance, if you're asked to bartend a private event, ask if there will be designated drivers available. Keep the local taxi numbers on hand, or install Lyft or Uber on your phone. Along with booze, make sure the bar is well-stocked with soft drinks, water and other non-alcoholic beverages.
- Entrepreneur: Freelance Bartender
- Pour Bar Services: Does My Event Bartender Need To Be Insured?
- Alcohol: Legal Risks Bartenders Face for Overserving Alcohol
- FLI Program: A Bartender's Guide to Liquor Liability Insurance
- Egroup: Bartender Liquor Liability Insurance Explored
- KMRD Partners:5 Steps To Choose The Best General Liability Insurance For Your Small Business
Fraser Sherman has written about every aspect of business: how to start one, how to keep one in the black, the best business structure, the details of financial statements. He's also run a couple of small businesses of his own. He lives in Durham NC with his awesome wife and two wonderful dogs. His website is frasersherman.com