It is the holiday season, a time for office parties and charity events. While gatherings can provide opportunities for professionals to mingle casually with their co-workers and clients and can help boost employee morale, they can also prove to be a liability for businesses that serve alcohol. That is why businesses should take reasonable precautions to prevent any risks and financially protect themselves by making sure they have the proper insurance, warned the Insurance Information Institute (I.I.I.).

Forty-four states plus the District of Columbia have enacted liquor liability laws. These laws make it possible for a plaintiff to hold those who serve alcohol to an intoxicated or underage person responsible for any damage or injury caused by these same individuals after they leave the party. Most of these laws also offer an injured person, such as the victim of a drunk driver, a method to sue the person who served the alcohol. There are circumstances under these same state laws where criminal charges may also apply.

Liquor liability laws were intended originally to apply to taverns, bars, and other establishments selling and serving alcohol. However, the liability laws have exp anded over time to include “social hosts” (such as those holding a holiday party in their home or business) in some states giving them some exposure to the risk of liability for serving alcohol.

“In many states you can be held legally responsible for your employees’ actions after they leave the party,” said Loretta Worters, vice president of the I.I.I. “If you are throwing an office party where alcohol is served, you have a responsibility to make sure that your employees are capable of driving safely.”

Worters noted that when business owners host a holiday party and serve alcohol as part of the festivities, liquor liability would most likely be covered by their commercial general liability (CGL) policy. “It’s best to check with your insurance agent or broker first,” she said, adding, that “if an employee becomes intoxicated and assaults another employee at the party, the incident might be excluded under the CGL policy.”

In addition to a CGL policy, businesses should also consider purchasing an Employment Practices Liability Insurance (EPLI) policy. An EPLI policy will protect a business from discrimination, sexual harassment, emotional distress, and other workplace-related issues. When you buy the coverage, make sure it includes “third-party” coverage. Third-party coverage refers to claims made by non-employees, usually clients or customers, who allege that an employee engaged in wrongful conduct such as sexual harassment or discrimination. This can be important coverage, for example, if someone in management has had too much to drink and makes an inappropriate overture to a client or customer. Without a specific policy endorsement for third-party claims, EPLI policy forms do not cover these types of exposures.

“Even innocent flirting or touching can be misconstrued and result in a lawsuit,” explained Worters.

In addition to overtly inappropriate behavior, if someone puts a video clip or picture on YouTube or Facebook that could result in reputational harm, it is also covered under an EPL policy.

Over the years, office parties have changed considerably. Alcohol used to flow freely, and employers would sometimes overlook inappropriate conduct, explaining away bad party behavior without taking any action. Today, lawsuits are so rampant that some companies have concluded office parties involving alcohol are not worth the risk.

If you plan to host a holiday party at which you will be serving alcohol, the I.I.I. offers the following tips to prevent a lawsuit:

1. Advise employees to be responsible. Include a statement on the party invitation and/or circulate a written reminder to all concerned on the responsibilities to drink only in moderation and to avoid driving after drinking.
2. Emphasize to management that they must lead by example.
3. Hold the party at an offsite location. If problems do arise, it is better that they occur away from the business premises. Depending on the state, the liability will generally be on the restaurant than the company. However, it is not unusual for an employer to be named as a defendant in a civil lawsuit if an intoxicated employee leaves any company-sponsored event and injures himself or herself or another person as a result.
4. Do not pay for alcoholic drinks. Guest will drink less if they have to pay for the drinks themselves.
5. If you feel you must furnish alcoholic beverages, consider a drink voucher system to limit the number of drinks served. Or, serve alcohol for only a short period.
6. Consider hiring a professional bartender. Most bartenders are trained to recognize signs of intoxication and will limit consumption by partygoers.
7. Offer non-alcoholic beverages and always serve food. It is proven that food can help counter the effects of alcohol.
8. Do not serve alcohol to minors.
9. Stop serving liquor toward the end of the evening and switch to coffee, tea and soft drinks.
10. Arrange alternative transportation. Anticipate the need for alternative transportation for all employees and guests and make special transportation arrangements in advance of the party. Encourage all employees and guests to make use of the alternative transportation if they consume any alcohol.

Worters advised business owners to talk with their insurance agent or company representative about their liability insurance coverage and any exclusions, conditions or limitations to their policies for this kind of risk. “Appropriate liability insurance coverage is necessary. In some cases special event coverage may be available that will cover both liquor liability and other liability exposures specific to the event.”

Source: Insurance Information Institute, “Is Your Company Hosting a Holiday Party? I.I.I. Offers 10 Ways to Protect Your Business” http://www.iii.org website. Accessed November 28, 2016. http://www.iii.org/press-release/your-company-hosting-holiday-party-iii-offers-10-ways-protect-your-business

© Copyright 2016. All rights reserved. This content is strictly for informational purposes and although experts have prepared it, the reader should not substitute this information for professional insurance advice. If you have any questions, please consult your insurance professional before acting on any information presented. Read more.

Be a Responsible Host When It Comes to Serving Alcohol at Parties

Whether you are hosting a Super Bowl party or greeting the New Year with friends in your home, if you are planning to serve alcohol at any type of party it is important to take steps to limit your liquor liability and make sure you have the proper insurance.

Social host liability, the legal term for the criminal and civil responsibility of a person who furnishes liquor to a guest, can have a serious impact on party throwers. Social host liability, also known as “Dram Shop Liability” laws vary widely from state to state, but 43 states have them on the books. Most of these laws also offer an injured person, such as the victim of a drunk driver, a method to sue the person who served the alcohol. There are circumstances under these laws where criminal charges may also apply.

While a social host is not liable for injuries sustained by a drunken guest (as they are also negligent), the host can be held liable for third parties, and may even be liable for passengers of the guest who have been injured in their car.

Before planning a party in your home, it is important to speak with your insurance agent or company representative about your homeowners coverage and any exclusions, conditions or limitations your policy might have for this kind of risk. Homeowners insurance usually provides some liquor liability coverage, but it is typically limited to $100,000 to $300,000, depending on the policy, which might not be enough.

Most importantly, whether you are hanging out with a small group of friends for cocktails or throwing a big family bash, remember that a good host is a responsible host, and takes steps to ensure guests get home safely if they have been drinking.

How to Protect Yourself and Your Guests

If you plan to serve alcohol at a party the I.I.I. offers the following tips to promote safe alcohol consumption and reduce your social host liability exposure:

• Make sure you underst and your state laws. Before sending out party invitations, familiarize yourself with your state’s social host liability laws. These laws vary widely from state to state. Some states do not impose any liability on social hosts. Others limit liability to injuries that occur on the host’s premises. Some extend the host’s liability to injuries that occur anywhere a guest who has consumed alcohol goes. Many states have laws that pertain specifically to furnishing alcohol to minors.

• Consider venues other than your home for the party. Hosting your party at a restaurant or bar with a liquor license, rather than at your home, will help minimize liquor liability risks.

• Hire a professional bartender. Most bartenders are trained to recognize signs of intoxication and are better able to limit consumption by partygoers.

• Encourage guests to pick a designated driver who will refrain from drinking alcoholic beverages so that he or she can drive other guests home.

• Be a responsible host/hostess. Limit your own alcohol intake so that you will be better able to judge your guests’ sobriety.

• Offer non-alcoholic beverages and always serve food. Eating and drinking plenty of water, or other non-alcoholic beverages, can help counter the effects of alcohol.

• Do not pressure guests to drink or rush to refill their glasses when empty. And never serve alcohol to guests who are visibly intoxicated.

• Stop serving liquor toward the end of the evening. Switch to coffee, tea and soft drinks.

• If guests drink too much or seem too tired to drive home, call a cab, arrange a ride with a sober guest or have them sleep at your home.

• Encourage all your guests to wear seatbelts as they drive home. Studies show that seatbelts save lives.

Source: Insurance Information Institute, “Social Host Liability” http://www.iii.org website. Accessed September 11, 2014. http://www.iii.org/article/social-host-liability

© Copyright 2014. All rights reserved. This content is strictly for informational purposes and although experts have prepared it, the reader should not substitute this information for professional insurance advice. If you have any questions, please consult your insurance professional before acting on any information presented. Read more.

It is the holiday season, a time for office parties and charity events. While gatherings can provide opportunities for professionals to mingle casually with their co-workers and clients and can help boost employee morale, they can also prove to be a liability for businesses that serve alcohol. That is why businesses should take reasonable precautions to prevent any risks and financially protect themselves by making sure they have the proper insurance, warned the Insurance Information Institute (I.I.I.).

Forty-four states plus the District of Columbia have enacted liquor liability laws. These laws make it possible for a plaintiff to hold those who serve alcohol to an intoxicated or underage person responsible for any damage or injury caused by these same individuals after they leave the party. Most of these laws also offer an injured person, such as the victim of a drunk driver, a method to sue the person who served the alcohol. There are circumstances under these same state laws where criminal charges may also apply.

Liquor liability laws were intended originally to apply to taverns, bars, and other establishments selling and serving alcohol. However, the liability laws have exp anded over time to include “social hosts” (such as those holding a holiday party in their home or business) in some states giving them some exposure to the risk of liability for serving alcohol.

“In many states you can be held legally responsible for your employees’ actions after they leave the party,” said Loretta Worters, vice president of the I.I.I. “If you are throwing an office party where alcohol is served, you have a responsibility to make sure that your employees are capable of driving safely.”

Worters noted that when business owners host a holiday party and serve alcohol as part of the festivities, liquor liability would most likely be covered by their commercial general liability (CGL) policy. “It’s best to check with your insurance agent or broker first,” she said, adding, that “if an employee becomes intoxicated and assaults another employee at the party, the incident might be excluded under the CGL policy.”

In addition to a CGL policy, businesses should also consider purchasing an Employment Practices Liability Insurance (EPLI) policy. An EPLI policy will protect a business from discrimination, sexual harassment, emotional distress, and other workplace-related issues. When you buy the coverage, make sure it includes “third-party” coverage. Third-party coverage refers to claims made by non-employees, usually clients or customers, who allege that an employee engaged in wrongful conduct such as sexual harassment or discrimination. This can be important coverage, for example, if someone in management has had too much to drink and makes an inappropriate overture to a client or customer. Without a specific policy endorsement for third-party claims, EPLI policy forms do not cover these types of exposures.

“Even innocent flirting or touching can be misconstrued and result in a lawsuit,” explained Worters.

In addition to overtly inappropriate behavior, if someone puts a video clip or picture on YouTube or Facebook that could result in reputational harm, it is also covered under an EPL policy.

Over the years, office parties have changed considerably. Alcohol used to flow freely, and employers would sometimes overlook inappropriate conduct, explaining away bad party behavior without taking any action. Today, lawsuits are so rampant that some companies have concluded office parties involving alcohol are not worth the risk.

If you plan to host a holiday party at which you will be serving alcohol, the I.I.I. offers the following tips to prevent a lawsuit:

1. Advise employees to be responsible. Include a statement on the party invitation and/or circulate a written reminder to all concerned on the responsibilities to drink only in moderation and to avoid driving after drinking.
2. Emphasize to management that they must lead by example.
3. Hold the party at an offsite location. If problems do arise, it is better that they occur away from the business premises. Depending on the state, the liability will generally be on the restaurant than the company. However, it is not unusual for an employer to be named as a defendant in a civil lawsuit if an intoxicated employee leaves any company-sponsored event and injures himself or herself or another person as a result.
4. Do not pay for alcoholic drinks. Guest will drink less if they have to pay for the drinks themselves.
5. If you feel you must furnish alcoholic beverages, consider a drink voucher system to limit the number of drinks served. Or, serve alcohol for only a short period.
6. Consider hiring a professional bartender. Most bartenders are trained to recognize signs of intoxication and will limit consumption by partygoers.
7. Offer non-alcoholic beverages and always serve food. It is proven that food can help counter the effects of alcohol.
8. Do not serve alcohol to minors.
9. Stop serving liquor toward the end of the evening and switch to coffee, tea and soft drinks.
10. Arrange alternative transportation. Anticipate the need for alternative transportation for all employees and guests and make special transportation arrangements in advance of the party. Encourage all employees and guests to make use of the alternative transportation if they consume any alcohol.

Worters advised business owners to talk with their insurance agent or company representative about their liability insurance coverage and any exclusions, conditions or limitations to their policies for this kind of risk. “Appropriate liability insurance coverage is necessary. In some cases special event coverage may be available that will cover both liquor liability and other liability exposures specific to the event.”

Source: Insurance Information Institute, “Is Your Company Hosting a Holiday Party? I.I.I. Offers 10 Ways to Protect Your Business” http://www.iii.org website. Accessed July 18, 2014. http://www.iii.org/press-release/your-company-hosting-holiday-party-iii-offers-10-ways-protect-your-business

© Copyright 2014. All rights reserved. This content is strictly for informational purposes and although experts have prepared it, the reader should not substitute this information for professional insurance advice. If you have any questions, please consult your insurance professional before acting on any information presented. Read more.