What is Assault and Battery Insurance and why you should have it
Assault & Battery Coverage
If you are owning and operating a Nightclub or Bar you should highly consider Assault and Battery coverage if you do not have it already. The largest influx of claims that we see in the Nightlife & Hospitality Industry fall under Assault & Battery. This covers third party liability arising out of any assault & battery. Coverage is patron to patron or employee to patron. For example, a claim under A&B would be if two patrons get in a fist fight at your bar or a patron could say that a bouncer used excessive force to remove him/her from the bar. Unfortunately, it happens more often than you would suspect and is extremely important to have on your Insurance policy. Regardless of if your bouncers are employees or contractors, it is necessary to have this coverage.
Now there are different options for Assault and Battery coverage. Who sells this coverage? There are some admitted carrier who offer stated limits of Assault and Battery coverage and other times have what is called ‘silent A&B’. Silent A&B is typically found on an ISO form and the verbiage reads along the lines of Assault & Battery is not included nor excluded from the policy. So, what does that mean? The great answer of it depends and it comes down to the individual situation. For some owners that is ok, but for others they would prefer stated limits for this coverage. Excess and Surplus Lines carriers will typically offer standard A&B sub-limits of $100K/$100K. There are carriers that offer higher limits such as $500K/$500K and even the FULL Limits of $1m/$1m. Of course raising these limits will come at a cost.
It is also important to understand the difference between having A&B coverage Inside the Limit vs Outside the Limit.
Defense Inside the Limit means that all defense costs (attorney’s fees, court costs, investigation and filing legal papers) are deducted first from the policy limit, which cuts into the overall limit of dollars available to pay for monetary damages awarded by a ruling.
In Defense Outside the Limit there are separate limits available for legal defense costs and court-awarded damages. Therefore, the defense costs outside the limits do not erode your policy limits available to pay settlements resulting from a suit.
It is extremely important to understand what limits you have on your A&B Policy. The market standard will write Assault & Battery as a Sub-Limit to the Policy, however; we suggest considering all options when it comes to this coverage. There are higher limits available in the market. Consider the type of business you are running and consult with your Agent.