Just like a house or vehicle, it’s important to purchase a boat insurance plan for your boat in case of accidents or natural disasters such as hurricanes or floods. Specific insurances plans can be purchased for these vessels:
- Boat
- Personal watercraft
- Sailboat
- Dinghies
- Yachts (Specifically vessels that are 27 feet and larger; yacht coverage tends to be broader and more specialized because larger boats travel farther and have more unique exposures)
- Boat and personal watercraft rental (Not required for rental, but can cover any damage to the vessel, as well as the operator and passengers)
- Boat clubs (Covers all members of club while operating a boat)
- Professional vessels such as fishing guides and charters
When choosing a plan, make sure it meets the needs of your vessel, as well as your personal and family needs. Factors to consider:
- Age of boat
- Length
- Value
- Speed
- Type
- Condition (compared to the US Coast Guard standards)
- Residence (primary residence vs a vacation spot)
- Homemade (boats without a serial number, many boat building kits are supported)
- Houseboats with no motor
- Ownership (more than 2 owners)
Types of Boat Insurance
There are two types of boat insurance, “agreed value” and “actual case value,” available to boat owners. An"agreed value" policy covers the boat based on its value when the policy was written. "Actual cash value" policies cover the value of the boat at the time it is declared a total or partial loss. The difference between the two plans is the boat’s depreciation over time, the costs for each vary.
Types of Coverage
Much like other types of insurance, boat insurance can cover different situations. An "all risk" policy will offer the most complete protection. Make sure to clarify what elements are included in“all risk” policies as typical exclusions include wear and tear, marring,denting, animal damage, manufacturer’s defects, defects in design, and ice and freezing. Most policies will cover permanently attached equipment, as well as items like anchors, oars, trolling motors, tools, seat cushions, and life jackets.
Also, consider inquiring about additional coverage options including medical payments, personal effects,uninsured boaters’ liability, and towing and assistance. Also ask about:
Specialized Coverage – Coverage for something specific on your boat like an expensive prop or accessory.
- Salvage – Coverage that pays to remove your boat due to damage, from substantial to minor.
- Consequential Damage - Covers a loss that was the result wear and tear rather than an accident (rot, mold, corrosion).
- Towing – Towing your boat across a body of water to safety.
- Cruising Extension – You can get temporary, additional coverage if you plan on leaving the USA (typically to Mexico or the Bahamas).
Claims
If a claim ever needs filed, make sure you understand what is required. When you purchase your plan, ask about the claims process. Then, keep your insurance information in a secure place at home, but also a copy in a safe, dry place on your boat in case of emergencies.
Boat Insurance Cost
Dozens of insurance companies offer boat insurance at varying cost levels. If you are looking for competitive pricing, consider asking your fellow boat friends which company has worked for them, then research those online. You can also research insurance carriers at www.ambest.com/ratings. The ratings are an independent judgment of an insurer's financial strength; look for an "A" rating (excellent) or better. State insurance regulatory agencies are also a good reference and can be found online.
Many factors are used to set the cost of a policy, and they vary among insurers. Additionally, discounts can be given.Here are some items to consider:
- Seasonality – Boat in summer, store boat in winter
- Cruising Area – Where you boat
- Boating Safety Education –If you have been formally trained or certified
- Good Driving Records –Both boating and driving
- Liability Limits - The higher the limit the higher the cost
- Deductible - The higher the deductible the lower the premium
- Bundling – Using the same company for coverage over home, car, etc
Content courtesy of DiscoverBoating.
