Rate hikes force closure of Park Circle’s Brew Cellar

Brew Cellar, a popular bottle shop in Park Circle, announced its closure last week. Brew Cellar’s last day of service will be Feb. 17.

The shop opened in 2014 in what was, arguably, the heyday of craft beer — locally and nationally. With draft beers and a wide variety of bottles and cans, the small but mighty shop has served as part–beer garden, part–retail store, for the past decade. Now, though, its owners say that it’s become too expensive to remain open.

“We’ve been dealing with insurance woes for about two-and-a-half years now,” co-owner Ryan Hendrick said. He’s referring, specifically, to liquor liability insurance, a hotly contested topic in the food and beverage world right now.

If you aren’t familiar with the insurance — and the reasons it’s controversial — the City Paper’s Jack O’Toole summarized the topic in a story last year:

“Bars in South Carolina are required to carry a minimum $1 million liquor liability policy. But because South Carolina law allows bar owners to be hit with 100% of the cost of a jury verdict in drunk driving lawsuits — even if they were found to only be 1% responsible for the harm caused by the drunk driver — insurance companies that provide this liability coverage have been losing money. And as a result, they’re now raising rates dramatically to offset those losses. Several companies have opted to leave South Carolina, too, winnowing the number of insurers to a handful.”

Hendrick said the cost of liquor liability insurance eventually became greater than Brew Cellar’s rent.

“It just depleted all the accounts pretty quickly,” echoed co-owner John Judson. And while insurance was a bit cheaper this year than in years prior, it’s still untenable for a business as small as Brew Cellar. “We’ve been trying to hold out and hold on, but it’s just getting to the point now where we’re unable to keep throwing money waiting on the proposed changes.”

Possible changes in law ahead

There are proposed changes to the current law — ones that would make it so that bar owners would be held responsible for the percentage of harm they were found to have caused, not 100% of the harm.

The South Carolina Senate will discuss an insurance reform bill this month.

Popular downtown dive bar Local 616 also announced its closure on social media last week. The double whammy of two local businesses closing — and citing liquor liability insurance as one of the reasons for doing so — led to an outcry from food and beverage employees and lawmakers.

S.C. Sen. Ed Sutton, a Democrat who represents downtown Charleston, posted a lengthy message on Instagram about prioritizing lower liquor liability premiums.

“I will support any bill that reduces premiums while ensuring victims of negligent operators can still seek justice,” he wrote. “In South Carolina, business owners should be able to operate without being fee’d to death, and patrons deserve to enjoy safe establishments.

“The worst course of action is inaction. Telling our constituents we need more ‘time to study the issue’ is unacceptable. Every day that passes without reform means another small business closing, more jobs lost, and Charleston losing another piece of its unique character.”

More to the story

High liquor liability insurance isn’t the only reason for Brew Cellar closing. Hendrick said that he’s seen a decline in interest in craft beer over the past several years, specifically in craft beer stores.

“Big beer is buying out smaller breweries,” he said. “Everything became grocery-store available. It just watered down the entire market.”

He also noted folks aren’t spending money like they used to. And when they are it’s when they’re trying the latest and greatest bar and restaurant, not a staple that’s been around for a decade.

“I think one thing we’d really want to say is — go to your favorite places,” Hendrick said. “Because they’re hurting. They still have to survive. Don’t forget about your favorites. It’s tough out there for everybody right now, and after our [closure] announcement, multiple businesses reached out to us to say they’re in the same boat.”

Between high insurance costs and low foot traffic, more local bars and restaurants could be following in the footsteps of Brew Cellar.

“I mean, food is culture,” Hendrick said. “And we’re going to lose all of that if something doesn’t change.”