The South Carolina Senate has passed a tort reform bill aimed at addressing growing challenges in the liquor liability insurance market.
Senate Bill 244 introduces changes to liability rules, damage awards, and insurance requirements for bars, restaurants, and nonprofit organizations.
Under the bill, joint and several liability rules would be modified so that businesses are required to pay economic damages in proportion to their share of fault in an incident. However, if a business is found to be more than 50% at fault, it would remain responsible for the full economic damages. Noneconomic and punitive damages would be apportioned based on each party’s level of fault.
The bill also lowers the minimum required liquor liability insurance coverage from $1 million to $500,000 for most businesses, and $300,000 for certified nonprofit corporations.
The reforms come in response to growing pressure on liquor liability insurers in South Carolina. A change in state law in recent years has allowed plaintiffs to hold establishments accountable for the actions of intoxicated patrons, including those involved in drunk driving incidents.
According to a report from the South Carolina insurance department, insurers providing liquor liability coverage in the state have paid out $1.77 for every $1 in premium earned since 2017.
In the worst year on record, that figure reached $2.60 per dollar earned.
Attempts to obtain comments from the bill’s sponsors and the South Carolina Insurance Association were unsuccessful.
SB 244 is part of a broader legislative effort. Lawmakers are also considering Senate Bill 397, sponsored by Sen. Deon Tedder, which would increase reporting requirements for insurers offering liquor liability policies. Tedder stated the goal is to gain greater transparency into how the market operates and how premiums are determined.
Will these reforms improve South Carolina’s liquor liability insurance market? Share your thoughts below.
