For boat owners, managing the risks of boat ownership while complying with the complex national and maritime regulations that govern their use can be taxing. Similarly, to get adequate insurance for any kind of boat, you need to understand the complex liability exposures. Here is how to keep your prized vessel safe and adequately insured.
Boat Insurance Basics
The type of insurance you should get and the rates you’ll be paying for coverage are largely hinged on your boat’s type, size, and value. Similar to when you’re purchasing any type of insurance, you need to understand your boat insurance’s policy limits and the perils covered.
Smaller crafts such as canoes, smaller powerboats, and small sailboats, whose maximum speed doesn’t exceed 25 miles per hour, can be covered by your renters’ insurance policy or standard homeowners policy. These policies typically cover the boat, motor as well as trailer. However, liability coverage is usually not covered, but you can add it to your policy as an endorsement.
Larger and Faster Crafts
If you own a larger and faster craft such as a yacht or a personal watercraft such as a jet ski, you’ll need a separate policy. Standard boat insurance policies cover property damage, physical damage to your boat, medical payments. Your insurance company may also offer extra, optional coverage for your boar accessories and trailers. Generally, the protection provided by boat insurance policies is broader compared to that offered by a homeowners’ or renters’ policy. Depending on the level of liability you’re exposed to, you should consider buying an umbrella policy.
Boat Insurance Coverage
There are two basic variants of boat insurance, with different premium costs and different parameters for calculating compensation. These include:
Agreed Amount Value
With an actual cash policy, the valuation of your boat is based on an amount you’ve agreed upon with your insurer. If you suffer a total loss, your insurer will reimburse you the “agreed amount.” In the event of partial loss, your policy will replace the damaged items without factoring in depreciation.
Actual Cash Value
With an actual cash policy, your insurer will typically factor in depreciation when calculating your compensation. In case of a total loss, price guides for used boats as well as other pricing tools are used to determine your boat’s market value. Similarly, in the event of partial loss, your insurer will factor in physical depreciation when valuing the damaged or lost items.
Some of the boat insurance coverages you should consider include:
- Physical Damage: This coverage covers damage to your boat resulting from a wide range of perils. Typical causes of damage covered include weather-related hazards like rain, hail, wind, wave action, lightning, damage or loss caused by vandalism or theft, and collisions with floating and submerged objects, docks, or other boats. Take note that exclusions generally vary from insurer to insurer.
- Theft of boat
- Bodily injury to individuals other than you, the boat owner, and your family
- Guest passenger liability: It covers liabilities emanating from someone using your vessel with your permission
- Damage to others’ property
- Medical payments: It covers injuries to you and your passengers
- Boat accessories or trailer
- Personal property may or may not be covered by your homeowners’ insurance policy. Therefore, you need to find out if your policy covers the equipment you keep in your boat, such as fishing gear
- Towing and assistance: It overs emergency assistance in the event of an accident
- Other liability coverages: Ensure your policy covers the disposal or removal of the vessel’s wreck, especially if it’s considered a danger to navigation. Moreover, the 1990 Oil Pollution Act obligates vessel owners to pay for clean-up expenses for contamination or oil pollution caused by their vessel, up to the legal limit. Therefore, you should consider getting a policy that covers this potential liability. Also, ensure your policy covers your crew as stipulated in the General Maritime Law, Jones Act, and Federal Longshore and Harbor Workers’ Compensation Act.
Boat Insurance Discounts
Make sure to take advantage of the discounts that may be available when:
- You own a diesel-powered craft (they are less dangerous compared to gasoline-powered boats)
- You have ship-to-shore radios
- You have coast guard-recommended fire extinguishers
- Your crew has completed the required safety training
- You have two years of no claims
- You have taken multiple policies with the same insurer
Best Practices for Boat Safety
To ensure that both you and your passengers are safe, you should:
- Have all the necessary equipment for everyone on board. Examples of equipment include navigation lights to lifejackets to sufficient fresh water, a first-aid kit, a tool kit, oars/paddles, and fire extinguishers
- Check the weather forecasts before you launch
- Someone should be aware of when you’ll sail and when you’ll return
- Check engine, steering, and electrical systems, and fuel
- Ensure your load is evenly distributed and inform your passengers that they shouldn’t shift weight suddenly
- Ensure everyone has a lifejacket
- Follow maritime traffic regulations
- Operate the boat only when you’re sober
- Check your communication devices
- Have an evacuation/emergency plan
If you are a boat owner, you might be wondering, “How can I find boat insurance near me?” At Humble & Davenport Insurance, our experts will help you find boat insurance in Renton, WA that suits your needs. To get started, contact us today!