What a Bar Insurance Policy Covers

Bars face risks that most businesses never deal with. You serve alcohol, often late at night, in a busy space with wet floors and breakable glass. When something goes wrong, a customer may get hurt, your equipment may be damaged, or someone may take you to court. The right bar insurance policy helps pay for those costs so they don’t come out of your pocket.

Understanding Bar Insurance

What is bar insurance? It’s a package of coverages for businesses that serve alcohol, such as bars, pubs, taverns and nightclubs. Most bars start with general liability, liquor liability, property and workers’ compensation. From there, they add other coverages based on how they operate, such as whether they host private events or brew their own beer.

Why There’s No Single Price for Bar Insurance

You’re asking, “How much does bar insurance cost?”, but the answer depends on your bar. Carriers price each policy based on the details of the business they’re insuring, and many of those details change from year to year. Price ranges you find online are often averages across many kinds of businesses and don’t reflect the real risk of a bar that serves alcohol late into the night. The most reliable way to get a number is a quote based on your own sales, location and coverage needs.

Common Coverages in a Bar Insurance Package

Each coverage protects against a different kind of loss. Here’s what each one does and where its limits are.

General Liability

General liability protects your business from claims made by customers, vendors and other people outside your business. It typically covers:

• Customer injuries, such as slips and falls
• Damage to a customer’s property
• Reputation damage, like libel or slander
• Claims of copyright violation in your advertising

General liability does not cover injuries to your own employees, which fall under workers’ compensation. It also excludes alcohol-related claims for businesses that sell or serve alcohol, which is why bars need liquor liability.

Liquor Liability Insurance

Liquor liability protects your business if an intoxicated customer injures someone or damages property after drinking at your bar. It helps pay for legal fees and the injured party’s medical bills. General liability excludes these claims for businesses that serve alcohol, and the exclusion can apply even if your bar served only one drink to a customer who was sober when they walked in. For a bar, this coverage is essential.

Property Insurance

Property insurance protects your building, furniture, equipment and inventory. Depending on the policy, it can cover losses from:

• Fire
• Severe weather
• Vandalism
• Equipment breakdown
• Spoiled food or drinks

Some of these may need to be added to the base policy. In the case of these unforeseen events, property insurance can also include business income protection, which helps replace lost income and pay ongoing expenses like payroll while your bar is closed for repairs. We can also customize your property insurance policy to include special protection for your bar equipment. Ask us about theft protection, inventory loss, and property damage coverage designed for establishments that sell alcohol.

Workers’ Compensation Insurance

Workers’ compensation pays for medical care and lost wages when an employee is hurt on the job. Bar staff may experience cuts from broken glass, burns in the kitchen or falls on wet floors. Workers’ comp is a separate policy from general liability, and it can also protect your business from lawsuits over workplace injuries. Requirements vary by state.

Errors and Omissions Insurance

If your bar books private events, reserves space for groups or offers catering, errors and omissions (E&O) insurance can help when a customer says you didn’t deliver what was promised. It may cover claims of misrepresentation or failing to meet the terms of an agreement, such as a private room that wasn’t set up as booked.

Product Liability Insurance

If you run a brewpub or distillery and sell your own beer, cider or spirits, product liability can protect you from claims that your product caused harm. For craft brewers, that could include an injury from a can or bottle that bursts because of re-fermentation.

Coverage Built Around Your Bar

Tabak Insurance Agency works only with hospitality businesses, so we understand the risks bars, pubs, taverns and nightclubs face every day. We start by learning how your bar runs, then put together coverage that fits. That can include liquor liability, property, workers’ compensation, errors and omissions, product liability or a business owner’s policy. Because we specialize in this industry, we have access to insurance markets many agencies don’t, and we know how to present your bar to carriers to get a better rate. We also stay with you after the policy is written, including help with inspections and audits. Call 800-806-0689 or request a quote to get started.

Frequently Asked Questions

Is a business owner’s policy enough for a bar?

A business owner’s policy (BOP) combines property and general liability coverage in one package for eligible small businesses. It can be a good base for a bar, but it doesn’t take the place of liquor liability. General liability excludes alcohol-related claims for businesses that serve alcohol, so a bar with a BOP still needs separate liquor liability coverage. Eligibility for a BOP depends on the carrier.

If we offer valet parking, are customers’ cars covered?

Partly. General liability can cover injuries caused while an employee parks a car on or next to your premises. It does not cover damage to the customer’s car, because property in your care is excluded. Businesses that offer valet often add garagekeepers coverage to a business auto policy to cover damage to customers’ vehicles.

Does bar insurance cover employee theft?

Theft of money or property by your own employees is usually covered under a commercial crime policy through employee dishonesty coverage. Limits can be set per loss, per employee or per position. If your staff handles cash, ask your Tabak Insurance agent whether your package includes this coverage.

Am I covered if an employee sues for harassment or wrongful termination?

Claims like wrongful termination, discrimination, sexual harassment and retaliation are covered by employment practices liability insurance (EPLI). It’s sold as its own policy or bundled with other management coverages. Unlike general liability, EPLI defense costs usually reduce the amount of coverage available, so choosing the right limit matters.