Liquor Liability Insurance for Tasting Rooms

[Brothers Vilgalys Spirits]

So we're just seeing our product on shelves locally here in NC (hooray!), and soon I'll be opening up the tasting room on Satudays. My insurance company is emphasizing the need for liquor liability insurance, which carries a minimum cost of $1,000 / year.

That seems extra-ordinarily high to me, especially because it's a policy designed for bars / restaurants. Pouring a single .5 oz sample is a pretty different, and I've tried to explain this.

How many tasting rooms bother with this extra insurance? I'll be open 4 days a month, serving a third of a drink. It just doesn't seem like the risk/reward is really favorable here.

[daveflintstone]

Are you selling out of there? If so, you'll make that back on one bottle. And you can get that coverage to also cover any tastings you hold off site.

also, I find that giant bee frightening.

[porter]

Are you selling out of there? If so, you'll make that back on one bottle. And you can get that coverage to also cover any tastings you hold off site.

also, I find that giant bee frightening.

$1000 profit on 1 bottle, now that's some kind of profit margin...............No wonder McDonald burgers are $10 in Hawaii.........

[Brothers Vilgalys Spirits]

We can't sell bottles ourselves, just offer samples. NC law limits us to .5 oz samples. I can serve up to two samples per person, but I only have one product. I think as long as we stay strident about not serving to any intoxicated folks, checking IDs, etc, we ought to be in the clear (legally). But of course that doesn't always stop opportunists from trying to sue someone.

The tastings would be a good point, except wouldn't those normally be either at a licensed venue or private event (which would have its own one-time policy)? I don't know, I suppose the insurance company would take any excuse they can not to cover any incidents.

[daveflintstone]

$1000 profit on 1 bottle, now that's some kind of profit margin...............No wonder McDonald burgers are $10 in Hawaii.........

hardeehar.

That $1000 is divided by 4 days a month, 12 months a year. <$21 profit a bottle, about average for direct sales I think. fyi, still a dollar menu here for your dining pleasure.

The events I've done tastings at required liability insurance. Sure in a licensed store they have their own insurance, but that covers them not your company. I am no fan of exorbitant insurance, and operated for two years without it. Now the cost seems minimal, so I acquiesce.

[rumfarmer]

$21 profit per bottle, Dave? Your COGS is impressive.

[Rmorenc]

How much coverage does that $1000 buy you? What size policy?

[Jedd Haas]

The liquor liability is typically a rider that's added onto your liability coverage. So the amount of coverage is determined by your overall coverage.