Casualty & LiabilityQuestion 89 of 215
Under California's Dram Shop law, a bar that sells alcohol to an OBVIOUSLY INTOXICATED MINOR who then causes a fatal car crash:
a.Has no civil exposure because California abolished all dram-shop liability
b.Is automatically liable to the injured parties under strict liability
c.May be civilly liable to injured third parties; Liquor Liability insurance is needed because the CGL excludes liquor liability for those in the business of selling alcohol
d.Is liable only to the minor, not to third parties
Explanation
California generally bars dram-shop suits (Cal. Bus. & Prof. Code §25602(b)), but §25602.1 carves out a key exception: a licensed seller who furnishes alcohol to an OBVIOUSLY INTOXICATED MINOR may be civilly liable for resulting injuries. Because the standard CGL Liquor Liability Exclusion (CG 00 01) excludes liability of an insured 'in the business' of selling alcohol, a separate Liquor Liability policy is required.
Law Reference: Cal. Bus. & Prof. Code §25602.1 (Dram Shop)Practice all 215 questions free — no signup required.
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