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From the Front Lines: Liquor Liability

Despite living in a state where there are no dram shop laws, independent agent Roger Cole always offers his clients liquor liability coverage "because there’s always that anomaly that can take place within the law," he says. "It’s our job to convince them there may be a situation where it comes up."
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Roger Cole

Roger Cole

President
Meridian Insurance Services
Carson City, Nevada

How did you get started at your agency?

I’ve been doing this for a little over 30 years. I started at a family-owned business, and then we were purchased by a much larger agency. I worked for them for nine years. Then, that agency was bought by Wells Fargo, but I opted out of that. I came here seven years ago, and I’ve been producing business since.

Why liquor liability?

There are no dram shop laws here in Nevada, but the main reason we offer it is for defense. Then, if anything odd ever comes up, we don’t have insureds coming back on us.

Biggest liquor liability changes?

In regards to the casinos, one change I have seen is that most applications are heavy on what type of classes servers take, so they can better identify who’s intoxicated and cut them off when they need to. That’s become more prevalent. The more an insured invests in training their people, the better their rate.

Biggest liquor liability challenges?

A lot of clients are savvy to the laws here, so a lot of them just don’t want to buy it. It’s our job to convince them there may be a situation where it comes up.

The other challenge we have is that with a lot of the smaller taverns, the liquor liability in comparison to the rest of their premium is a bigger hit. With the larger companies, where they already have a premium of maybe $20,000, an extra $500 is nothing. But when a smaller business has a premium of $2,000 and you tack on another $500, it becomes an issue—particularly when we don’t have dram shop laws.

Future of liquor liability?

I don’t see our laws changing. I know things are becoming more liberal, particularly in our state. I’m not an attorney, and I can’t speak for the East, but in the West, I’ve seen liquor liability laws relaxing a little bit.

Liquor liability advice for a fellow agent?

Try to stress that your insureds should carry it because there’s always that anomaly that can take place within the law. Particularly since we’re surrounded by other states that do have those laws, it’s just something you need to offer. Maybe you can offer it to them at lower limits than the general liability limits—then at least they’ll have some sort of defense coverage if something comes up.

Favorite liquor liability success story?

Some carriers don’t realize there are no dram shop laws here. I work with a beer distributor, and I wanted to make sure they had liquor liability to satisfy Anheuser Busch requirements—they distribute up in Lake Tahoe. But the carrier was charging outrageous numbers.

I said, “Do you realize we don’t have liquor laws here?” They came back the next year and revamped their rates to be more appropriate for Nevada.

Will Jones is IA assistant editor.

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Sunday, August 2, 2020
Liquor Liability