Iowa Hospitality Industry Seeks Dram Insurance Law Changes

The Iowa Restaurant Association reported it is asking state lawmakers to pass dram insurance reform that would make it possible for restaurant and tavern operators to secure better policies to help compensate innocent victims if an intoxicated person causes harm and the restaurant or bar is held partially responsible.

In Iowa this coverage requirement is unique to those who “sell and serve” alcohol such as restaurants and bars. There is no similar requirement for those who “sell” unopened alcohol such as box stores, pharmacies, grocery and convenience stores, the association said.

“We are the only segment of the industry which is held responsible for the behavior of others,” Jessica Dunker, president and CEO of the Iowa Restaurant Association, said in the group’s announcement. “We understand we have a unique relationship with patrons and as such we’re willing to carry the extra coverage, but we also have to have access to affordable policies.”

According to Dunker, Iowa ranks 46th in the nation in “insurability” for dram. “That’s a pretty unattractive marketplace,” says Dunker. She points to the rankings from ISO, an organization that provides actuarial and other information about property/casualty insurance risk.

“The way Iowa’s laws are written today, it’s nearly impossible for them to determine their risk,” says Dunker. “If I was an insurance carrier, I’d think twice about writing dram policies in Iowa too.”

The association hopes their proposed changes will bring Iowa’s dram insurance grade in line with surrounding states. “Nearly anything would be better than what we have today,” said Dunker.

Source: Iowa Restaurant Association