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Dram Shop Law

What Does Dram Shop Law Mean?

The Dram Shop Law states that businesses that sell liquor to a person who is obviously intoxicated can be held liable for losses that person causes within a certain amount of time. Restaurants and bars have to buy liability insurance to cover this risk.

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Insuranceopedia Explains Dram Shop Law

The Dram Shop Law is common in the United States; however, not every state has it since it can be difficult to prove that liquor served at a particular establishment is to blame for a specific loss. For example, a person could have some drinks at a bar, then take a few shots in their car before driving off and causing an accident.

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InsuranceLiability InsuranceGovernment Regulations

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