Cost Savings Available for Fraternal Club Liquor Liability

// December 6, 2017

Fraternal clubs (American Legion, VFW, Hibernians, Elks, Moose, etc.) and sports clubs (golf, tennis, etc.) differ from restaurants and bars open to the general public because they have restricted admission policies.

Club members form a community that has greater concern for fellow attendees and less of a profit motive for service staff leading to over-service. As a result, the liquor liability risk presented by fraternal clubs is lower than restaurants and bars with comparable sales.

Recognizing this difference between clubs and bars, USLI has multiple credits applicable to fraternal clubs with the right characteristics, reducing liquor premiums by up to 30 percent. USLI provides a 10 percent premium credit for any fraternal club that has limited admission policies, defined as no “same day” memberships and no more than 3 guests per member per day (excluding family and banquet business). If a club meets these criteria, we can add an additional 5 percent liquor credit if each of the following criteria is met:

  • No citations/violations in the past five years – 5 percent
  • No liquor related losses in the past five years – 5 percent
  • No drink specials or happy hours – 5 percent
  • No major entertainment except for banquets – 5 percent

All of these credits are subject to the state minimum premium applicable to the club.

Fraternal clubs have various alcohol outlets that could engage in negligent service, most notably the bar or canteen and the banquet facilities. The following claim example shows how alcohol use can end in an expensive lawsuit.

Three club members attended a dance at a local fraternal club where they consumed alcohol. One hour after leaving the dance, they were involved in an accident where one passenger sustained a traumatic head injury. He was in a coma for two months with over $350,000 in medical bills. The passenger sued the club for serving an intoxicated person. The claim settled for the full policy limits of $500,000.

Clearly liquor liability claims for fraternal clubs can have significant pay-outs.

USLI has a Liquor Liability product solution to protect your fraternal clubs, featuring:

  • Limits up to $1,000,000/$2,000,000
  • Employees and club members covered as insureds at no additional charge, even if club members are serving as volunteer bartenders at the club
  • Additional 15 percent credit available for responsible clubs where all servers have alcohol awareness training
  • Specialized claims expertise with defense unlimited and outside the limits

Fraternal clubs concentrate on carrying out their missions and improving their communities. They can easily lose sight of the liquor liability risks in their operations. USLI’s fraternal club liquor liability policies provide essential cost effective coverage, recognizing the important distinction between fraternal clubs and comparable bars.

Please contact your Hospitality and Liquor Lines underwriter for more information or a quote. This product is also available to quote online >>


As always, thank you for your support and business!

Karen-FordContact Karen Ford,
Vice President, Product Team Leader | 888-523-5545 Ext. 2391

JeffEstabrookWritten by Jeff Estabrook
December 7, 2017