A Captive Insurance Answer to South Carolina’s Bar Insurance Crisis

For nearly eight years, South Carolina’s bars, restaurants and music venues have been squeezed by a 2018 state law mandating at least $1 million in liquor liability coverage. With traditional insurers charging unaffordable premiums or refusing to write the business altogether, many establishments have faced a stark choice: pay up or close down.

Now a group of hospitality industry allies, led by Charleston wealth manager Andrew Reina, believes it has found a partial fix. Two years ago Reina launched Ragnar Hospitality Insurance, a captive insurer that can write coverage at one-third to one-half the cost quoted by admitted carriers. The reason, he says, lies in an underwriting philosophy that replaces spreadsheet ratios with boots-on-the-ground investigation.

“Most insurance companies look only at the total alcohol sales,” Reina told Insurance Journal. “If it’s less than 50% of total sales, they’ll think about writing it. But that’s a completely inaccurate way to measure the risk.” Ragnar instead sends teams on unannounced visits, deploys secret shoppers, and talks to neighboring bar owners to test whether applicants are telling the truth about their hours, ID-checking practices and drink specials. One owner who claimed armed security and coverage through a Berkshire Hathaway unit was rejected after Ragnar flagged inconsistencies. Another lost his shot when a hidden inspector observed $1 jello shots—a practice that would void the policy.

The captive has secured reinsurance from Gen Re and has already signed 39 establishments, with most reportedly paying far less than the best quotes they’d previously received. For one venue with $1.5 million in sales, the premium fell from $42,000 to a fraction of that under Ragnar’s program.

Behind Ragnar Hospitality’s Vetting Model and the State’s Legal Minefield

How Ragnar’s Vetting Process Goes Beyond Sales Figures

Reina’s central insight is that the standard metric—the percentage of revenue from alcohol—is a poor proxy for real risk. By instead focusing on management quality through physical inspections, covert drink orders and intelligence from rival bars, the captive aims to filter out the high-risk operators that drive catastrophic claims. Clean bathrooms, attentive ID checks and honest disclosure of late-night hours all become underwriting signals. “If they’re not paying attention to that, they’re probably not paying attention to other things,” Reina said of bathroom cleanliness.

Can Intense Scrutiny Scale?

The very hands-on approach that makes Ragnar credible also raises questions about scalability. One independent agent described the process as “too time-consuming and labor intensive to be sustainable.” Becky McCormack, president of the Big I of South Carolina, while wishing the venture success, noted that one captive cannot reach the hundreds of establishments still searching for affordable coverage. The skepticism is not about the captive’s integrity but about whether such high-touch underwriting can remain economically viable as the book grows.

The Real Problem: Joint and Several Liability

Even if Ragnar’s model works, industry observers argue that the fundamental driver of high premiums remains untouched. South Carolina’s joint and several liability doctrine allows plaintiffs to seek enormous damages from parties who may have played only a minor role in an alcohol-related accident. McCormack pointed out that many responsible bar owners have already tightened operations—checking IDs, limiting hours, training servers—yet still cannot find reasonable premiums. Without tort reform, similar to what Georgia and Florida enacted in recent years, the market cannot attract enough carriers to bring prices down broadly. Opponents of change argue stiff penalties are needed after high-profile drunk-driving tragedies, leaving lawmakers in a stalemate.

What South Carolina Hospitality Owners and Policymakers Should Do Next

  • For South Carolina bar and restaurant owners: If you’re struggling to afford mandated coverage, investigate whether Ragnar’s captive is open to new applicants. Be prepared for unannounced inspections and deep vetting of your operations, but the payoff could be a premium that is 33–50% lower than what admitted carriers quote.
  • For state policymakers: The captive can offer a lifeline to several dozen venues, but it will not fix a statewide crisis. Legislators should examine Georgia and Florida’s recent tort-reform packages that limited outsized verdicts in alcohol-related cases—the only proven way to attract a competitive insurance market back to South Carolina.

Risk & Opportunity Assessment

Commercial RiskMediumThe captive’s sustainability depends on rigorous underwriting that some agents consider too labor-intensive. A single large claim—or a string of smaller ones—could test capital reserves despite reinsurance from Gen Re.
Competitive RiskLowAdmitted carriers have largely abandoned the market, giving Ragnar little direct competition. The captive’s niche, high-touch model is unlikely to invite rapid imitation because it rejects standard actuarial shortcuts.
Regulatory RiskHighSouth Carolina’s joint and several liability law remains the root cause of unaffordable premiums. Without tort reform, even well-vetted establishments can face outsized judgments that strain the captive’s reinsurance protections.
Reputation RiskMediumIf an insured bar is involved in a high-profile alcohol-related accident despite Ragnar’s vetting, the model’s credibility could be undermined and pressure could mount on reinsurers to pull back.
Technology DisruptionLowRagnar explicitly bets on human judgment over algorithmic underwriting. While AI-driven tools could eventually replicate some aspects of risk screening, the confidential, on-the-ground intelligence gathering described here is hard to automate.
Commercial OpportunityHighIf the model proves durable, Reina plans to expand to other states with similar liability requirements—Vermont was named—and into other niche, hard-to-place lines such as childcare and logging-truck insurance.