Most states have a dram shop law to deter providers of alcoholic beverages (servers, liquor stores, bars, restaurants) who sell or serve alcoholic beverages under authority of a license or permit from selling or serving alcoholic beverages to obviously intoxicated individuals.

These laws generally eliminate any liability of servers, liquor stores, bars, and restaurants when a person to whom they sell or serve alcohol causes personal injury or property damage—whether in an automobile accident, a fight, or other incident—unless the person to whom they sell or serve alcohol is obviously intoxicated.

Laws regarding dram shop liability vary from state to state and are usually located in a state’s statutes.

In Indiana, dram shop laws are codified under Indiana Code 7.1-5-10-15.5, which holds that a person who provides alcoholic beverages is not liable for damages caused by an intoxicated person unless it can be proven that the provider furnished the alcohol to a visibly intoxicated person, and the intoxication was a foreseeable cause of the injury. This means that bars, restaurants, liquor stores, and other licensed establishments in Indiana can be held liable if they serve alcohol to someone who is clearly intoxicated, and that person goes on to cause harm to others, such as through a car accident or physical altercation. However, proving visible intoxication and causation can be challenging, and the burden of proof lies with the person bringing the claim. It is important for establishments serving alcohol to be aware of these laws and to train their staff accordingly to avoid serving alcohol to visibly intoxicated individuals.