Agents and brokers should be able to present underwriters with a full breakdown of how alcohol is sold and consumed at a business seeking coverage. This is critical to understand as this liability and exposure can differ based on the type of business. (Credit: Master1305/Shutterstock)

The microbrewery market is built on innovation — innovation in flavors, business models and even beer names. Yet this modern, clever and adaptable industry is beholden to some comparatively old rules, regulations and laws. So-called dram shop laws determine to what degree a bar or other seller of alcohol is liable for injury caused to or by their intoxicated patrons. These laws vary state-by-state, which means businesses in different states assume different levels of liability when they serve wine, beer and liquor. No matter the state, there are a few things insurance professionals should know about these laws and regulations to help limit insureds' liability.

According to FindLaw, 43 states in the U.S. allow businesses to be held liable in cases in which they serve alcohol to individuals that end up causing injuries or death from intoxication. The most common of these laws prohibit establishments from serving minors or intoxicated customers. They also tend to prohibit serving outside of legal hours and outside the bounds set by their liquor licenses. There are other notable differences among dram shop laws. For example, Illinois and Minnesota have caps on settlements.

Related: Liquor liability exposure and coverages

Where's the exposure?

It is important to know the different exposures that can lead to lawsuits under dram shop laws. Consider the growing popularity of "wine trails." Groups of people hop from winery to winery in one area — following a local "wine trail." These become all-day drinking events, which carry all the usual risks associated with large groups of intoxicated people: slips and falls, DUIs, etc. Plus, participants have started adding more and more distilleries and wineries to their itineraries — adding higher quantities of and higher-octane beverages to the mix.

It's key for these business owners to know that if someone was injured at the hands of a drunk wine trail trekker; each winery that person visited could get named in a suit brought against him or her by a third party. Additionally, while tasting rooms tend to sell at higher margins because of direct to consumer sale; owners need to be aware that this increased consumption on premises often leads to more intoxicated consumers. Owners and employees need to take measures to manage risk in advance.

This is just one example of how a winery, brewery or another establishment can be implicated in a lawsuit. However, it demonstrates some risk factors: large parties; drinking in multiple places; drinking too much; drinking without much food.