What Umbrella Insurance Can and Can’t Cover for Bars

Bars face serious liability risks, and having umbrella insurance is a must. But umbrella insurance won’t cover some scenarios, and new bar owners might not realize this. If you’re a new bar owner and don’t obtain the right types of coverage, you could end up in a lot of trouble, and your bar could end up closing. Pikes Peak Insurance Agency in Falcon, CO, can show you what coverage you’re missing.

Never Forget Liquor Liability Insurance

Many bar owners fall into the trap of thinking that umbrella insurance is there to catch and cover anything that the bar’s primary liability insurance doesn’t cover. That’s not accurate. Umbrella insurance does provide additional liability coverage when the primary policy’s coverage reaches its limits. However, it’s really just a backup. It’s not a substitute for things you didn’t have coverage for in the first place.

What many people assume is that a bar will need liability insurance and that the policy they get will cover everything up to a certain limit. However, general liability insurance for bars is usually separate from liquor liability insurance. That means that, if you buy general liability and umbrella policies, and then your bar is sued because your bartender served an obviously drunk person who later hurt someone, you may not have any insurance coverage for that lawsuit. What you’d need is liquor liability coverage, and then when that ran out, the umbrella insurance would take over. Without the main liquor liability coverage, the umbrella insurance will be useless for liquor liability cases.

If you’re looking for umbrella coverage for your bar, talk to an insurance agency like Pikes Peak Insurance Agency in Falcon, CO, first. Ensure you have all the necessary policies in place so that umbrella insurance truly covers what you need it to cover.