Could your summer party get you sued?

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Could your summer party get you sued?

It’s summer party season, which means backyard beers, poolside cocktails and porch wine. But before you invite your friends over to cool off and let loose, there’s a few things you should know about liability so your friends’ mistakes don’t become your responsibility.

Consider this: In over half of U.S. states, there are “social host liability” laws on the books that hold you responsible if someone gets drunk at your house and then hurts someone or damages property. Before you crack open a cold one, consider what you can do to lower your risk.

Drunk (driving) history

Social host liability laws are descendents of so-called “dram shop laws,” which can hold bars and restaurants liable if they over-serve. Dram shop laws were developed post-prohibition when an increase in drinking combined with the newfound popularity of the automobile meant that drunk driving started to cause a lot of damage. Legislators hoped that, by assigning liability to bar owners, it would encourage them from over-serving and discourage drunk driving. In the 1980s, social host laws extended that liability to residential property owners.

The laws, which vary widely by state, assign criminal and civil responsibility to hosts who serve alcohol to guests — meaning that if a guest leaves your house and hits a cyclist with their car, that cyclist can sue you for property damages and bodily injury.

Social host laws are a controversial tool for reducing drunk driving — no one wants to be held responsible for the actions of others. But also, the laws work: The National Institute on Alcohol Abuse and Alcoholism (NIAAA) notes that a 2000 study found social host laws correlated with less drinking and driving and less heavy drinking.

The good news is most states’ social host laws focus on your liability after supplying alcohol to minors — so if you only have people over 21 at your house, you’re probably going to be OK. But if a minor does get access to alcohol at your home and then gets behind the wheel, some states will hold you doubly responsible, allowing any victim of your minor guest and your minor guest to sue you for damages. (You can also be sued if a minor has to be treated for alcohol poisoning after being at a party at your home.)

The laws can vary widely beyond that — in New Jersey, for example, if a “visibly intoxicated” guest hurts someone after drunk driving, you can be held liable whether you physically gave them a drink or they simply helped themselves. In New Hampshire, a minor who furnishes alcohol to other minors can be liable. In Illinois, you can be liable if you rent a hotel room for minors knowing they’ll drink liquor in it. In Iowa and Tennessee, you are only responsible if the drunk guest is under age 18. In California, hosts are not held responsible for the actions of party guests — unless the guest was a minor.

Even in the states without official host laws, you can still be charged with criminal or civil liability if an intoxicated guest at your home — minor or adult — goes on to harm a third party.

Are you covered?

If you have homeowners insurance or renters insurance, your policy comes with universal liability insurance, which means you’re protected in many instances of legal action against you. (Like, if grilling goes wrong or fireworks misfire and a guest gets singed.)

However, when it comes to social host liability suits, you’re very likely not fully covered.

The liability coverage provided by your homeowners or renters insurance omits intentional or criminal acts, so if you knowingly provided alcohol to a minor or you knew your party guest was going to leave your house and get behind the wheel, your coverage would not apply. Most homeowners insurance policy also exclude punitive damages, so even if your legal costs were covered, if a jury ordered you pay punitive damages to the third party, your insurance would not pay out.

If you’re sued by a third party as the result of an auto accident, there is some disparity in what insurance companies will cover — homeowners and renters insurance liability both have an auto exclusion when you’re operating the vehicle, but the language on most policies is less clear regarding whether it covers your liability if a guest is an auto accident. Your personal auto insurance may step in here — most policies cover you for the “use of any vehicle” and doesn’t say it has to be “by you.”

How to get (more) coverage

Some renters and homeowners policies do provide liquor liability coverage. If you host a lot of parties, find out if yours does — or find a new carrier that provides that coverage. (You can get quotes right here.) Adding an umbrella policy that includes host and liquor liability is another option.

A third option is to purchase special event insurance that includes liquor liability. You still wouldn’t be covered for obviously criminal or negligent acts (giving drinks to a minor, knowingly putting your drunk friend behind the wheel), but this insurance would cover your legal costs and medical payment payouts if one of your guests hurts a third party. Depending on the size of your event, special event insurance can cost a few hundred dollars, but if your party is big enough, having the extra liability coverage may make sense. (For example, many people purchase special event insurance for weddings.)

Tips to mitigate your risk during summer party season

Summer is peak party season, and we want you to have fun! We just also want you to be responsible. So here are our tips for having boozy summer fun the smart way:

  • Know the social host laws in your state.

  • If you have kids, talk to them about liquor liability. Let them know that even if they sneak liquor, you could be held responsible and lose everything (not to mention — though do mention — they could hurt or kill themselves or others if they got behind the wheel while intoxicated).

  • Keep kids away from the booze. At parties, keep the bar in your line of vision and lock up your liquor. "I didn't see them drinking" isn't an excuse in most states.

  • Have lots of non-alcoholic options available and encourage guests to partake in them instead of or in addition to alcoholic drinks.

  • Have lots of food available to slow down drinking and sop up alcohol.

  • Take keys from obviously drunk people, and offer guests beds, couches, and rides home.

  • If you’re throwing a big blow-out, consider purchasing a special event general liability insurance policy with liquor liability, which can cost a few hundred dollars depending on the size of your event.

  • If you do encounter minors drinking at your home, take immediate steps to stop consumption and take away the alcoholic beverages (in addition to being the right thing to do, this can mitigate your liability later on). And, of course, confiscate keys and provide rides home.

  • According to the NIAAA, past history of violations involving alcohol is a good indicator of the likelihood of future violations. Using that info, hone your guest list, or keep a close eye on certain guests who may have a history of getting behind the wheel when they shouldn’t — and be quick to take their keys or call cabs on their behalf.

Social host liability laws by state

Even in states that don’t have specific social host liability laws, you can be found criminally negligent if you serve alcohol to minors or if an intoxicated guest goes on to harm a third party. But if your state has an offical social host law on the books, you should know about it:

States with social host laws that apply generally (meaning, if person of any age hurts someone or damages property after getting drunk at your house, you could be held liable)
Alaska
Arkansas
Connecticut
Hawaii
Maine
Maryland
Massachusetts
Missouri
New Jersey
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
Tennessee
Washington
Wisconsin

States with social host laws that apply specifically to minors (meaning, if person under 21 — 18 in some states — hurts someone or damages property after getting drunk at your house, you could be held liable)
Alabama
Arizona
Florida
Illinois
Indiana
Iowa
Kansas
Michigan
Mississippi
New Hampshire
South Dakota
Utah
Wyoming

Want to have a summer party but need to get your budget ready first? Check out 12 ways to get your budget ready for summer in 5 minutes or less.

Image: Petar Chernaev