Does My Restaurant Need Insurance for BYOB or Corkage Service?
Yes. "We don't sell the alcohol" does not mean you carry no liability for it. Licensees remain responsible for what happens on their premises even when a guest brings their own bottle, and charging a corkage fee can push the exposure even closer to a traditional sale.
The 'We Don't Sell It, So We're Not Liable' Misconception
Many BYOB restaurants assume that because no alcohol changes hands at a register, alcohol-related liability simply doesn't apply to them. That assumption is wrong in most jurisdictions.
The Pennsylvania Liquor Control Board's BYOB FAQ confirms that BYOB service is legal and corkage is optional, but licensees remain strictly liable for Liquor Code violations occurring on their premises even when they did not sell the alcohol being consumed, citing 47 P.S. §4-493(1). If an over-served guest causes harm after leaving your BYOB restaurant, your restaurant's premises and licensing status can still be implicated, independent of who bought the wine.
How a Corkage Fee Changes Your Exposure
Charging a corkage fee introduces a second wrinkle. A fee tied to opening or serving a guest's bottle can start to look less like a neutral accommodation and more like a component of an alcohol transaction.
The Ohio Investigative Unit notes that corkage-style fees can constitute a constructive illegal sale in some circumstances, creating a liability exposure that a truly free, uncharged BYOB accommodation would not carry. In practical terms: the more your BYOB program resembles a sale (fees, pouring service, glassware charges), the more it should be treated like one for insurance purposes.
What This Means for Your Coverage
- Your staff is still pouring, serving, and monitoring intoxication levels, even on bottles you didn't sell.
- Overserving a visibly intoxicated BYOB guest can still expose your restaurant to third-party claims after they leave.
- A corkage fee, glass rental charge, or any pricing tied to the guest's bottle should be flagged to your broker as part of your alcohol service model, not treated as an unrelated add-on.
Insurance Kitchen's Liquor Liability Insurance can be structured to reflect a BYOB or corkage-only service model rather than assuming full commercial alcohol sales, which affects how your premium and coverage terms are set.
A Related Gap: Comped Alcohol at Private Events
BYOB and corkage share a theme with another commonly overlooked scenario: alcohol you didn't technically sell but still carry exposure for. See You're Comping an Open Bar for a Private Party, Not Selling Drinks: Does Social Host Liability Apply to Your Restaurant?
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