Most pub insurance policies nowadays are packaged products, made up of the main types of cover you will, or may, need. Some of these are included as standard, and removing them from the policy has no effect on the premium payable.
One of these additional covers is loss of licence, but what exactly does this mean? Any establishment that sells alcohol effectively needs to authorised, or allowed, to do this. The local authority for where the business is based, will have a licensing committee, whose role it is to allow, or approve, a premises to be able to sell “intoxicating liquor”. It is not the premises that receives the licence, but an individual associated with the business.
So, there are two things that the committee takes into account. The suitability of the person and the suitability of the premises (ie where is it, what hours do they open, has the premises had trouble in the past etc).
In reality, it is a rubber stamping exercise and most licences are annually renewable. But, if the premises does not get it’s licence renewed, then the business will, usually, suffer a loss in profits. Without the licence, they cannot serve alcohol and this will usually mean less customers, or potential closure.
Business insurance policies will have loss of licence cover, usually for £50,000, £100,000 or £250,000. If the premises becomes un-licensed, a potential claim could be made.
But, and it really is a big but, this has to be something that is outwith the control of the person who has the licence. If you have had rowdy behaviour and police have requested remedial action, which has not been taken, this is within your control and your claim is not valid.
It is really important that you always read the policy wording. For loss of licence, this will only be a couple of pages, but you should make yourself aware of the exclusions that apply.