The Alcohol Risk Management Plan Convenience Stores Will Need
New laws are holding convenience stores liable for selling gas to drunk drivers. It is time to create an alcohol risk management plan to protect your convenience store.
This year, the National Association of Convenience Stores (NACS) raised alarm about a new law implemented by the Supreme Court in New Mexico. The controversial law states that convenience stores are responsible and will be held liable for selling gasoline to drunk drivers. The new ruling applies to all commercial establishments that sell a variety of everyday items under the popular claim “24 hours open.” This includes all gas stations and fuel selling centers.
The new law establishes that employees of service stations will be treated similarly to bartenders. They will have reasonable care not to sell gasoline or alcohol to drunk customers.
On one side of the argument, NACS states that “the court overreached in its decision.” On the other hand, the State Supreme Court indicated that they hold on to their decision under the premise that by having employees carry this responsibility, many lives will be saved. Advocates against drunk driving support this decision and present Tennessee as an example. In the United States, this is the only other state with a similar law.
According to Insurance Journal, this ruling stemmed from a case in 2011 where a drunk driver and his passenger ran out of gas. They walked to the closest gas station, filled a water container with gasoline, and hit the road again causing a head-on collision. The sad outcome of the accident was the death of another driver. The victim’s family sued the gas station under the premise that the company was liable for selling gas to the intoxicated man. This claim was not successful because the State Supreme Court stated there was no law against selling gas to a drunk driver at that time.
The new law is leaving many retailers confused about what liability they need to have when it comes to drunk drivers. The case we analyzed opens the debate on what type of insurance the owners of convenience stores should have.
What Type of Insurance Protects Convenience Stores against Drunk Drivers?
Currently, there is no specific insurance policy that gas stations and other retailers can purchase to protect themselves if an employee sells fuel to a drunk driver. But, the suggested best practice in this scenario is to have a Liquor Liability Insurance Policy in place in conjunction with a risk management plan.
Liquor liability insurance is a policy for businesses that sell or serve alcohol. It provides coverage to the store in the case of legal expenses or damages if an intoxicated person files a lawsuit, is injured, or causes property damage.
Although not common, this coverage is sometimes included in your General Liability Insurance Policy. To complement this insurance, specialists also suggest relying on a strong risk management plan to make sure all the insurance protection needed is in place.
Have a Risk Management Plan to Protect your Store
Without an insurance policy to assure there is protection, many businesses are fearful of what may happen if an employee sells gasoline to a drunk person. By adding this potential situation to your risk management plan, it is less likely to result in a damaging outcome.
The plan should outline what situations could arise and steps for employers to follow in different scenarios. For example, call the police in the case of an aggressive drunk buyer, or even the option of reporting them as soon as they exit the store.
Statistical trends indicate that more states will follow Tennessee and New Mexico law and prevent accidents from happening by restricting the sale of gasoline to drunk drivers. Until then, having a risk management plan for these situations is the best option.
If you need help adding this to your risk management plan or if you need to create one from scratch, check out our blog for more information on creating a risk management plan and what insurance you should include.