One of the most common questions I get around launching mobile bars is regarding insurance, which is a solid indication of how smart the average mobile bar owner is! In many instances insurance is required by a regulatory body, but even when it’s not a requirement, it plays a critical role in protecting your business in case the worst happens. In this post I’m going to run through the different types of insurance that you should be carrying, and briefly cover the how and why you need that coverage.
How to get coverage.
First, let’s talk about how to talk about your business. Mobile bars are still a relatively new concept for insurance companies, and the minute they think you’re a margarita machine driving down the road and selling boozy slushies like an ice cream man, they’ll ghost you. The liability implications of such a thing would scare even the least risk-averse agent!
You, my friend, are a caterer with a catering rig. They know how to classify that, and they know how to cover that. Catering and food trucks have been around a lot longer than mobile bars. Don’t confuse the situation by trying to describe what you are and what you do. I’ve been down that road and it doesn’t turn out well.
Now that you know how to talk about your business to the insurance companies, let’s get into the type of insurance that you need.
1. General Liability Insurance
This insurance covers things like bodily damage, property damage, and even reputational damage that were caused by your business. A guest trips over your extension cord and breaks a leg, or one of your bartender’s backs into the host’s bridal cottage, etc. This insurance also covers your rig while it’s stationary/onsite.
If you have a rig as a part of your mobile bar business, you’ll also want to add on Inland Marine coverage. I don’t know why they call it that, but it covers all the equipment inside of your rig in the case of damage. You’ll want a level of coverage that would allow you to replace everything if you had to start over.
2. Liquor Liability Insurance
This insurance covers you in the case of a suit related to damage or bodily harm caused by someone who has consumed alcohol. Some people think you don’t need liquor liability if you’re not the one who purchased it, and if you’re not selling it. I would recommend anyone serving alcohol carry it though. Even if the groomsman chugged an entire bottle in their private quarters before falling on the cement floor and busting open their head, if they sue, you’re going to get caught up in that lawsuit, even if you didn’t serve them. Liquor liability insurance helps cover the legal costs of the suit.
3. Commercial Car Insurance
You’ll want commercial car insurance on both your rig/s AND your tow vehicle. This covers your rig while it’s in motion.
4. Workers Compensation Insurance
This is only applicable if you have employees (not just 1099s) but some mobile bars are moving the W-2 route, especially out in California due to their new laws surrounding 1099’s. It may also be required if you partner with another company to use their liquor license. This covers your employees and 1099’s should they get injured while working for you.
Where to get coverage.
You are welcome to use a local broker if you can find one that will cover all these things. I haven’t had success with a single broker, so I use a few different ones to meet my coverage needs. I use FLIP for general liability and liquor liability, then Progressive for commercial car insurance and Pie for workers comp.