Last Updated: May 23, 2024, 12:43 pm by TRUiC Team

Bar Business Insurance

Getting insurance for your bar is essential.

Bars need to be protected against claims emerging from things such as liquor liability, copyright infringement, or assault and battery.

For example, an employee may accidentally fail to disclose an allergen in one of your drinks, or a bouncer may cause injury to a patron while dealing with another patron.

We’ll help you find the most personalized and affordable coverage for your unique business.

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Recommended: Next Insurance is dedicated to matching small businesses with the right policy at the best price.

Best Insurance for a Bar

General liability insurance is — generally speaking — one of the most important insurance policies for bars. 

Some of the risks general liability insurance covers are:

  • Bodily injury
  • Property damage
  • Medical payments
  • Legal defense and judgment
  • Personal and advertising injury

For many bars, general liability is only a component of their total insurance protection. Some of the other coverage policies they also tend to use include:

  • Workers’ compensation insurance
  • Commercial property insurance
  • Business interruption insurance
  • Commercial umbrella insurance

You will notice that, when buying insurance, providers are commonly divided into two broad categories: 

  • Traditional brick-and-mortar insurers: These firms, such as CNA and The Hartford, employ experienced insurance agents to offer their clients highly tailored policies. However, due to the higher overheads incurred by their use of physical stores, these providers are often pricier.
  • Online insurers: On the other hand, these firms capitalize on the lower overheads of their highly digitized business to provide customers with high-quality quotes that are relatively inexpensive. Powerful AI technology is used to quickly generate personalized quotes.

Let's Find the Coverage You Need

The best insurers design exactly the coverage you need at the most affordable price.

Cost of General Liability Insurance

On average, bars in America spend between $500 - $1,200 per year for $1 million in general liability coverage.

Compare the average cost of general liability insurance for a bar to other professional industries using the graph below.

Several factors will determine the price of your policy. These include your:

  • Location
  • Deductible
  • Number of employees
  • Per-occurrence limit
  • General aggregate limit

You may be able to acquire general liability insurance at a discounted rate by purchasing it as part of a business owner’s policy (BOP) rather than as a standalone policy.

A BOP is a more comprehensive solution that includes multiple forms of coverage, such as business interruption and property insurance.

Graph showing average price of general liability insurance prices per industry

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Find the Best Rate

Discover the best coverage at the lowest rate in our cheapest business insurance review.

Common Situations That General Liability Insurance May Cover for a Bar

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Example 1: As your weekly liquor delivery comes in, the loading dock door malfunctions and crushes the back-end of the delivery truck. Your general liability insurance policy will likely cover the damages to the truck and pay to replace the broken items as well.

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Example 2: Your bar features dancing lessons on Wednesday nights for college students. During your first event, one of the dancers slips on some broken glass and falls, seriously injuring her shoulder and elbow. General liability insurance will likely cover her medical bills and any associated legal costs in a lawsuit.

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Example 3: While putting away some stage equipment after a live performance, an employee loses control of a large cart. The cart crashes into a group of customers and seriously injures several people in the process. General liability insurance will likely cover their medical costs and any payouts if you settle their complaints out of court.

Other Types of Coverage Bars Need

While general liability is the most important type of insurance to have, there are several other forms of coverage you should be aware of. Below are some of the most common types of coverage:

Workers’ Compensation Insurance

If an employee is injured on the job or falls seriously ill after a work-related incident, workers’ compensation insurance will pay for their medical bills. Additionally, if they are unable to return to work, they may be eligible to receive disability benefits.

Commercial Property Insurance

To keep your bar running smoothly, you rely on a lot of specialty equipment, furniture, tools, computer systems, and inventory. If these items were destroyed in a fire or other incident like a burglary, you could be left to cover the cost of replacing them. However, commercial property insurance will help to pay for these repairs and replacements.

Business Interruption Insurance

Certain incidents may make it necessary to shut your doors while repairs are made. For example, if a fire breaks out in your bar and destroys the dance floor, you’ll need to close operations down for a couple of weeks. Business interruption insurance can help to cover some of your lost revenue during this downtime.

Commercial Umbrella Insurance

Sometimes a legal claim or accident can exhaust your primary coverage limits. If this happens, you could be stuck having to pay for the additional fees out-of-pocket. Commercial umbrella insurance covers expenses when your primary coverage is exhausted.

Additional Steps To Protect Your Business

Although it’s easy (and essential) to invest in business insurance, it shouldn’t be your only defense.

Here are several things you can do to better protect your bar:

  • Use legally robust contracts and other business documents. (We offer free templates for some of the most common legal forms.)
  • Set up an LLC or corporation to protect your personal assets. (Visit our step-by-step guides to learn how to form an LLC or corporation in your state.)
  • Stay up to date with business licensing.
  • Maintain your corporate veil.

Bar Business Insurance FAQ

Yes, absolutely. You will need to first get a quote from an online business insurance provider like Next Insurance. Next allows you to then purchase a policy immediately and your coverage will be active within 48 hours.

A typical business owner’s policy includes general liability, business interruption, and commercial property insurance. However, BOPs are often customizable, so your agent may recommend adding professional liability, commercial auto, or other types of coverage to your package depending on your company’s needs.

"Business insurance" is a generic term used to describe many different types of coverage a business may need. General liability insurance, on the other hand, is a specific type of coverage that business owners need to protect their assets.

Yes, appropriate business insurance coverage for your bar is essential before it launches. This is because of the sheer number of risks these businesses are exposed to – facing them without insurance would spell disaster.

In many cases, your bar will be legally required to carry some form of insurance if it wants to maintain compliance with business regulations — especially if you decide to hire a staff.

Not necessarily. Certain exceptions may be written directly into your bar insurance policy, and some perils may be entirely uninsurable.

Yes, an LLC is meant to create a legal barrier between your business and your personal assets and credit. If you haven’t formed an LLC yet, use our Form an LLC guide to get started.

An LLC doesn’t protect your business assets from lawsuits and liability– that’s where business insurance comes in. Business insurance helps protect your business from liability and risk.