What to Know About Liquor Liability for Social Gatherings at Your Home

If you’re hosting a party and supplying alcoholic beverages, you could be responsible for what happens after guests leave your home. Liquor liability can lead to legal or financial consequences if a guest overindulges and causes harm or property damage.

While some homeowners insurance policies offer limited protection, the coverage often isn’t enough for the full cost of alcohol-related incidents.1

Here’s how liquor liability works, when you could be on the hook for hosting private events, what insurance might cover, and how to protect yourself and your guests.

What is liquor liability?

Liquor liability is the legal responsibility you might face if someone drinks alcohol at your home and then injures someone or damages property. It can apply if you’re selling alcohol (like at a bar, liquor store, or grocery store) or simply providing it at a social gathering.

Some liquor liability laws specifically apply to business owners or people with a license to sell alcohol to the public. For homeowners, social host liability is most relevant. It’s what holds you accountable if a guest drinks too much and causes harm.2

Social host liability laws allow injured parties to take legal action against the person who served the alcohol.

Does home insurance cover liquor liability?

Home insurance may cover liquor-related incidents, depending on your policy. Most standard homeowners insurance policies include liability coverage that kicks in if a guest incurs an injury on your property. But things get more complicated if you’ve been supplying alcoholic beverages and the guest has been drinking.

If a guest who has been drinking leaves your private party and causes a car accident, your policy limits may not cover the damages. Insurers usually cap social host liability coverage somewhere between $100,000 and $300,000, according to the Insurance Information Institute (Triple-I). Social host liability cases often result in judgments for several million dollars.3

Talk to your insurance company to find out exactly what your coverage is and whether it’s worth adding more protection, like an umbrella policy, for extra liquor liability coverage.

Social host liability laws

Social host liability laws, also known as dram shop laws, hold you responsible if someone drinks alcohol at your home and later causes an accident or injury.

Dram laws vary but often focus on specific situations, like stopping a drunk driver from getting behind the wheel and preventing underage drinking. Some states also hold social hosts accountable if adults drink too much.

Here are the main areas where social host liability comes into play:

• Underage drinking and parties: If you provide alcohol to a minor or a minor drinks at your home, you could have legal responsibility if they then injure someone or cause property damage.

• Furnishing alcohol to adults who are already drunk: In some states, you could be liable if you serve more alcohol to a visibly intoxicated person and they go on to cause an accident.

• Accidents and injuries: If a guest leaves your party after drinking and gets into an accident, you might be on the hook for any injuries or damage they cause. This can include bodily injury to third parties and passengers in the car.

• Wrongful death: If an intoxicated guest leaves your party and causes a fatal accident, some states allow the victim’s family to file a lawsuit against you for wrongful death.

Liquor liability laws by state

Your level of liability can vary widely throughout the U.S., depending on the laws where you live.4 While some states limit responsibility to underage drinking, others extend the rules to include visibly intoxicated adults.

The table below outlines general information about social host liability, based on research of publicly available legal summaries and state statutes. Learn more about what hosts may be liable for in different states in the table below:

Tips for hosting at your house

If you’re hosting a party or special event with alcohol, it’s smart to take a few precautions to keep everyone safe. Being proactive may also help you protect yourself from liability and legal costs. Here are a few tips:

Liquor liability FAQs