Mass. Liquor JUA Hikes Limits Again

The Liquor Liability Joint Underwriting Association of Massachusetts (LLJUA) is offering coverage of up to $2 million per person and $2 million per occurrence ($2 million/$2 million), effective June 1, 2006.

“The increase is based on market demand,” said LLJUA President John W. Tympanick. “Last year when LLJUA increased coverage limits to $1 million/$1 million, the response was even more enthusiastic than we expected, but we also received feedback that insureds would like even higher limits.”

The $1 million/$1 million coverage was designed so that establishments with liquor licenses could supplement it with excess coverage. Now they have a choice of purchasing excess coverage or potentially being fully covered through LLJUA, Tympanick said.

LLJUA also announced that that cost of coverage for some establishments will increase 15%, effective June 1, 2006. The cost will remain unchanged for all licensees who purchase coverage at the $1 million/$1 million limit and for package store owners. Rates will also remain unchanged for the smallest businesses, since the minimum premium level will remain at the level it has been at since 2004. All others will be subject to the rate increase.

In addition, LLJUA announced changes covering licensees that provide entertainment and an incentive for providing security training to personnel. LLJUA also announced that licensees that close by 8 p.m. will receive a 10% discount.

Licensees will no longer pay a 10% surcharge for providing pinball, video games, Keno, sports-related games or other electronic games. However, the surcharge will increase to 20% for those that provide live entertainment on 75% or more of the days they are open. It will remain at 10% for those that provide live entertainment for less than 75% of the days they are open. Live entertainment includes live music, comedians and other performers, disc jockeys, karaoke, amateur nights and exotic dancers.

In addition, licensees can receive a 50% reduction in the cost of their general liability assault and battery coverage if 100% of management and 75% of non-management staff receive security training from a trainer approved by LLJUA.

“Half of all liability claims against owners of bars and nightclubs result from assault and battery,” Tympanick said, “so we would like to encourage businesses to train their staff to prevent assault and battery.”

Commissions will be based on the same percentages they were at before the rate increase. Agents will receive a commission of 17.5% for businesses that previously had no coverage; 15% for businesses that previously had coverage, but are new to LLJUA; 12.5% for renewals, and 10% for temporary policies.

In spite of the rate increase, Tympanick said rates remain lower than they were during the period from 1986, when LLJUA was formed, to 1996.

“We believe the new rates are more equitable than ever, as they reward establishments that train their staff properly,” Tympanick said. “Those owners that protect their patrons will also go a long way toward protecting their business.”

Source: The Liquor Liability Joint Underwriting Association of Massachusetts (LLJUA) is a last-resort liquor liability insurance provider for businesses that have been turned down for coverage in the voluntary market at least three times. For further information, contact John Tympanick at 877-366-1140 or 508-366-1140, ext. 11 or by fax at 508-836-4940.