Contents


    Executive Summary

    Approximately two billion people around the world consume alcoholic drinks. While light to moderate alcohol consumption can benefit health, more excessive alcohol consumption can seriously harm health and lead to a loss in quality of life due to injuries, alcohol dependence, and chronic disease. 17.6 million people, or one in every 12 adults, suffer from alcohol abuse or dependence along with several million more who engage in risky drinking patterns that could lead to alcohol dependency. More than 30% of American adults have abused alcohol or suffered from alcoholism at some point in their lives. Nearly 88,000 people (about 62,000 men and 26,000 women) die from alcohol-related causes annually.
    The effects of alcohol on insurance can be something as simple as providing coverage for the treatment of alcoholism, but could also include more complex scenarios like an injury or death involving someone who abused alcohol, or a loss of business resulting from an alcoholic employee.

    Background

    Alcoholism, also known as alcohol use disorder (AUD), is a medical condition that is diagnosed when a patient’s problem drinking becomes severe and when their symptoms match a certain number of diagnostic criteria. AUDs were previously divided into two types: alcohol abuse and alcohol dependence. However, the Diagnostic and Statistical Manual of Mental Disorders, Fifth Edition (DSM-5), created by the American Psychiatric Association and published in 2013, no longer uses the terms “abuse” and “dependence”, but rather refers to AUDs defined as mild, moderate, or severe, dependent on the number of diagnostic criteria (two or more) met by an individual:
    • Drinks large amounts over a longer time period than intended
    • Has difficulty cutting down
    • Spends a great deal of time obtaining alcohol, using alcohol, and recovering from its effects
    • Craves/desires alcohol
    • Usage results in not fulfilling responsibilities, but user does not stop
    • Usage results in social problems, but user does not stop
    • Usage results in health problems, but user does not stop
    • Usage results in risky situations (drinking and driving, unsafe sex), but user does not stop
    • Withdrawal occurs when stopping
    • Alcohol tolerance has occurred with use
    The mild, moderate, and severe sub-classifications are structured as follows:
    • Mild: presence of 2-3 diagnostic criteria
    • Moderate: presence of 4-5 diagnostic criteria
    • Severe: presence of 6 or more diagnostic criteria
    Excessive drinking is different from alcohol use disorder. It includes heavy drinking (drinking five or more drinks on the same occasion on five or more days in the past 30 days), binge drinking (drinking five or more alcoholic drinks on the same occasion on at least 1 day in the past 30 days), and any drinking by pregnant women or people younger than 21. Excessive drinking generally refers to the abuse of alcohol in a social or celebratory setting, while an AUD indicates a deeper psychological and physical addiction. These forms of excessive drinking have the potential to lead to alcoholism and long-term abuse, but it is important to distinguish that most people who drink excessively are neither alcoholics nor alcohol-dependent.

    Injuries and Damages

    Excessive alcohol use contributes to over 200 diseases and injury-related health conditions. Alcoholism is especially prevalent in the food service, construction, mining and drilling, excavation, and maintenance industries.
    Specific Alcohol-Related Injuries and Damages
    Alcohol can affect all parts of the body, but alcohol’s active ingredient, ethanol, particularly affects the brain, stomach, heart, gallbladder, and immune system. Because it is a toxin, it damages nerve cells. It also causes chemical changes in the brain and shrinkage of brain tissue. Heavy drinking damages blood vessels and is linked to high blood pressure, raised cholesterol levels, and increased risk of heart attacks and strokes. Alcohol also irritates the stomach lining, leading to vomiting and poor absorption of nutrients, making it easy for users to become vitamin deficient.

    Short-term health risks surrounding alcohol use include injuries, including motor vehicle crashes, falls, drowning, and burns; violence, including homicide, suicide, sexual assault, and intimate partner violence; risky sexual behaviors; and miscarriage and stillbirth or fetal alcohol spectrum disorders among pregnant women.

    Fetal alcohol exposure can occur when a woman drinks excessively while pregnant. Alcohol can disrupt fetal development at any stage during a pregnancy, including the earliest stages, before a woman knows she is pregnant. Research shows that binge drinking and regular heavy drinking put a fetus at the greatest risk for severe problems. Fetal Alcohol Spectrum Disorders (FASD) can cause brain damage which lead to a range of developmental, cognitive, and behavioral problems that can appear at any time during childhood. FASD is the umbrella term for different diagnoses, including Fetal Alcohol Syndrome. Data suggests that 20-30% of women drink at some time during pregnancy.

    Binge drinking can be associated with other conditions, including brain damage, alcohol poisoning, and alcoholic blackouts. Many young people are binge drinkers, like college students who consume great quantities of alcohol in short time frames. Because younger drinkers are less experienced, their risk of suffering from alcohol poisoning is much higher. Alcohol consumption can thin the pre-frontal cortex in the brain of young people. This area of the brain is responsible for functions like decision making, emotional responses, and impulse control. Heavy drinking in young adulthood can pave the way for a tendency to drink excessively in later years.

    Over time, excessive alcohol use can lead to chronic diseases and other conditions including high blood pressure, an irregular heartbeat, heart disease, stroke, liver cirrhosis, disease, or failure, and digestive problems; cancer of the breast, mouth, throat, esophagus, liver, and colon; learning and memory problems, including dementia and poor school or work performance; mental health problems, including depression and anxiety; and social problems, including family problems and unemployment.

    Alcoholism increases a person’s risk of developing common types of dementia such as Alzheimer’s disease and vascular dementia. Alcoholism can also cause alcohol-related brain damage (ARBD), a term that covers several different conditions including alcoholic dementia, a long-term decline in memory, and Wernicke-Korsakoff syndrome (WKS). WKS is a chronic memory disorder caused by severe deficiency of thiamine (vitamin B-1) that causes vision changes, ataxia (loss of full control of bodily movements), and impaired memory. WKS has a relatively low prevalence, but researchers believe the disease is under-reported and under-diagnosed. Based on clinical research studies, 22% to 29% of individuals with dementia were found to be heavy drinkers or alcoholics. Medical researchers are still struggling with how to fully define the association between heavy alcohol use and symptoms of dementia.

    Individually, excessive alcohol use can damage a user’s emotional stability, finances, career, and can impact family, friends, and coworkers. Additionally, excessive drinking has larger societal implications. In 2010, alcohol misuse problems cost the federal government $249 billion, or about $2.05 per drink. Two out of every five dollars of these costs were paid by federal, state, and local governments, making the case that society pays for excessive alcohol use.

    The CDC found that the main costs of excessive drinking result from losses in workplace productivity (72% of total cost), health care expenses for treating problems caused by drinking (11%), law enforcement and other criminal justice expenses (10%), and losses from motor vehicle crashes related to alcohol use (5%). The CDC believes that these numbers are underestimations of the true cost of excessive drinking, because information on alcohol use is often underreported or unavailable.

    One-third of all suicides, one-half of all murders, and one-half of domestic violence cases are alcohol related. 25% to 40% of all hospital beds in the United States (except for those being used by maternity and intensive care patients) are being used to treat health conditions that are related to alcohol consumption. Drunk drivers are responsible for 50% of people killed on the road.
    Some Benefits of Alcohol
    Researchers agree that alcohol is both a poison and a tonic, with the difference lying in quantity. Many studies support the idea that moderate alcohol consumption can benefit a consumers’ health, with “moderate consumption” meaning up to one drink per day for women and up to two drinks per day for men. This definition is for one single day, and is not intended as an average over several days. Most studies do not distinguish between different types of alcohol, but in a few studies, wine appears to be more beneficial than beer or liquor.

    Harvard University’s School of Public Health found that moderate amounts of alcohol raise levels of high-density lipoprotein, HDL, or ‘good’ cholesterol and higher HDL levels are associated with possible protection against heart disease. Moderate alcohol consumption has also been linked with beneficial changes ranging from better sensitivity to insulin to improvements in factors that influence blood clotting. Such changes would tend to prevent the formation of small blood clots that can block arteries in the heart, neck, and brain, the ultimate cause of many heart attacks and the most common kind of stroke.

    Researchers have found that drinking two drinks of alcohol per day can reduce the risk of gallstones by one-third. Another study found that drinking moderate amounts might be good for the heart and circulatory system, and could offer some protection against type 2 diabetes and gallstones. A drink before a meal can improve digestion. Light to moderate drinking seems to reduce the risk for dementia and cognitive decline by 23%. Researchers say that small amounts of alcohol might make brain cells more fit by causing stress on the cells and toughening them, preparing them to cope with worse stressors down the road that could cause dementia.

    Legislation and Regulation

    Local, state and federal laws govern the manufacture, sale, minimum age rules, and management of alcohol-related problems in the United States. The 21st Amendment to the U.S. Constitution provides that state governments have control over alcohol importation, sale, possession and distribution in their states. The most widely applied federal law is the Federal Uniform Drinking Age Act of 1984 that sets the minimum legal drinking age at 21 years old. This law is observed by all the states, although statutes about possession, and exceptions to the law such as allowing underage individuals to drink with their parents, vary from state to state. Some states allow local control over the development and enforcement of rules governing alcohol.

    Liability and Insurance

    Many health insurance policies cover certain types of treatments for alcoholism such as detoxification and outpatient counseling. Still, excessive drinking by, and alcoholism in, employees or their family members can be an expensive problem for business and industry, with consequences including lost productivity, absenteeism, injuries, fatalities, theft, low employee morale, and increases in health care costs, legal liabilities, and higher workers’ compensation claims and premiums. Workers with alcohol problems are almost three times more likely than workers without drinking problems to have injury-related absences. From a group health perspective, companies can manage a portion of their risk by conducting drug and alcohol screenings for employees before the start of work. Insurance coverage of alcohol-related injuries or lost productivity varies on a state-by-state basis.

    Litigation

    Although there are similarities between the way tobacco and alcohol are considered potentially damaging products, lawsuits filed against alcohol companies are few as compared to the number of litigations brought against tobacco companies. Some industry observers have stated that this might be because manufacturers place responsibility for alcohol use fully on the user by publicly encouraging responsible drinking. Also, it has been noted that alcohol may have some health benefits if used in limited quantities.
    Bar owners have been held liable under some liquor liability laws for injuries to customers and third parties that occur when a bartender is aware that a bar patron is inebriated but continues to provide alcohol to that patron. Some states apply the same laws to individuals serving alcohol in their homes or to employers providing alcoholic drinks at employer-sponsored social events. There have also been attempts to apply these same standards to universities. The parents of Ethan Connolly have sued the University of Delaware and a sorority over his death following a party in 2013. Mr. Connolly left a sorority party in October 2013, and along with another student attempted to cross the Del. 896 highway, where he was fatally hit by a truck. His parents claim that the defendants did not adequately ensure that Mr. Connolly was able to safely return to campus, and that they did not do enough to ensure those drinking at the party were of legal drinking age. The defendants argue that Mr. Connolly chose to drink of his own accord, that they had implemented checks to curb underage drinking, and that Mr. Connolly had been previously warned about dangerous drinking habits.

    Future Outlook

    Alcohol has been around for roughly ten million years – before humans even began storing harvested food, primates developed the ability to produce a gut enzyme necessary to metabolize the first alcohol, which likely came from fruit colonized by yeast in various stages of fermentation. After a ten million-year love affair, it is obvious that humans will not part with alcohol anytime soon. However, the health and socioeconomic problems alcohol creates can be significantly reduced with effective regulations, policies, and education. While accessible and affordable treatment can help curb AUDs and other drinking problems, the availability and quality of treatment is highly dependent on the terms of insurance policies. The (re)insurance industry should consider pushing for more effective polices aimed at decreasing alcohol related complexities.

    In the News

    2023

    • Mini bottles of Fireball aren’t actually whiskey, leading to a lawsuit - Emily Heil, The Washington Post (01/20/2023)
      People buying small bottles of Fireball at their local convenience store might be surprised to learn that they’re not getting the same as the stuff that comes from the liquor store — and that difference is at the center of a lawsuit in which a customer is suing the maker of both beverages.

       

    2016

    • Insurers off the hook in alcohol-related wrongful death suit - Randall Chase, The Washington Post (11/28/2016)
      A judge says insurers don’t have to provide liability coverage to a caterer in a wrongful death lawsuit filed by the parents of a University of Delaware student allegedly served alcohol at a party and later hit by a car and killed. The judge ruled last week that Capozzoli Catering is not entitled to coverage because of a “liquor liability” exclusion for a business that furnishes alcohol and serves alcohol to an underage person.

    2015

    • Alcoholism And How USC May Have Violated ADA By Firing Steve Sarkisian - David Kim, HR Hero (10/19/2015)
      On October 12, 2015, Steve Sarkisian was fired as head coach of the University of Southern California (USC) football team. While USC contends Sarkisian was fired for “cause,” there is no question that his alcohol-related behavior led to his termination.

    2014

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