February 7, 2014




BDI News: Weekly Tips


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2014 Illinois Statutory Dram Shop Limits Determined



The 1998 amendments to the Illinois Liquor Control Act, commonly known as the Dram Shop Act, require the Illinois Comptroller to annually determine the increase or decrease in the liability limits for causes of action brought under the Act, in accordance with the consumer price index (CPI-U) published by the Bureaus of Labor Statistics.


The 2014 figures  are based on an increase in the CPI-U of 1.50% from 2013. The liability limits for claims occurring on or after January 20th, 2014 are $65,017.86 for bodily injury and property damage (each), and $79,466.27 for either loss of means of support or loss of society resulting from the death or injury of any person.


For perspective, below are the limits over the last decade.


Bodily Injury & Property Damage

2004: $51,415.89

2005: $53,092.05

2006: $54,907.80

2007: $56,302.45

2008: $58,599.59

2009: $58,652.33

2010: $60,247.68

2011: $61,151.39

2012: $62,961.47

2013: $64,057.00

2014: $65,017.86


Loss of Society/Loss of Means of Support

2004: $62,841.64

2005: $64,890.28

2006: $67,109.53

2007: $68,814.11

2008: $71,621.72

2009: $71,686.18

2010: $73,636.05

2011: $74,740.59

2012: $76,952.91

2013: $78,291.89

2014: $79,466.27


Percent of Change

2004: +1.88%

2005: +3.26%

2006: +3.42%

2007: +2.54%

2008: +4.08%

2009: +0.09%

2010: +2.72%

2011: +1.50%

2012: +2.96%

2013: +1.74%

2014: +1.50%


The numbers speak for themselves. In the last ten years, Bodily Injury and Property Damage have risen by $11,925.81, respectively, while Loss of Society/Loss of Means of Support has increased by $14,575.99. The lesson we try to stress to our clients is that the cost of Liquor Liability claims goes up every year. If you're still carrying the state minimum of $300,000 in liquor liability coverage you have a potentially dangerous exposure, and one that is often inexpensive to remedy.


In a one person claim, you very well may be ok with a lower liability limit. But even a two person claim, with maximum damages awarded per person for Bodily Injury, Property Damage and LS/LMS, you could face a potential claim well north of $300,000 - putting you almost $100,000 out of pocket without considering whether your policy limit includes or excludes defense costs.


Even with a $500,000 Liquor Liability limit, it doesn't take much stretching of the imagination to envision a potential claim that would exhaust half a million dollars of coverage. Increasing damage settlements such as this are precisely the reason that $1 Million in liquor liability coverage has been the industry standard.


Whether you're in Illinois and are "protected" by the Dram Shop limits, or a state without a dram shop statute to cap the damages you may face in a suit, the warning is the same: these big claims happen more than you may hear about. Don't be caught off-guard and underinsured and jeopardize the the assets and future of your business.


What liquor liability limits do you carry?  Ever had a huge liquor liability claim against you - how did it turn out?  Please share on our Facebook page.  We want to hear from you.


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Bret Dixon Insurance