Five Things You Should Know About Boat Insurance
#1:;Do you have the right amount of coverage on the hull? Obviously, you want to make sure you have enough insurance on the boat, but when was the last time you reviewed your policy
to be sure the coverage reflects the current value of the boat?
I’ve seen people over insure their boat by 50% or more! The premium on your boat insurance is directly related to the value on the boat. Over insuring the boat equals over paying for insurance! Check to be sure limit on the hull reflects the current market value of your boat.
While we’re talking about hull coverageare you covered agreed value or actual cash value on your boat? Certainly agreed value is much better because the company agrees in advance how much they’re going to pay you in the event of a total loss on your boat. Actual cash value on the hull would only pay you the book or depreciated value.
#2:;Liability or Protection and Indemnity Coverage.;This coverage affords protection for bodily injury and property damage to others. ;Make sure that you have enough coverage to comply with the requirements of your personal umbrella .;If you dont have an umbrellayou should get one!
In the meantime, be sure you have at least $500,000 or better yet$1,000,000 of liability coverage. The difference between $500,000 and $1,000,000 of coverage many times will only be $25 or $50 for the year.;A great investment!
#5:;Are you getting all the credits you are entitled to?
Possible credits include:;
The Marine Insurance Leader For Over 35 Years
High performance boats need high performance insurance.
If your speedboat does over 65 mph, then it needs serious protection. Insurance protection, that is. For over 35 years, Markel Specialty has focused on high performance boat insurance. We understand that a high performance boat policy isnt like a typical boat policy. Each Markel Specialty high performance boat policy can be customized to fit you, your budget, and your boating style.
Types Of Boat Insurance Coverage
This will depend on the type of policy, but common coverage add-ons include:
- Specialized Coverage:;Coverage for something specific on your boat like an expensive prop or navigation equipment.
- 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 .
- Towing: Towing your boat across a body of water to safety can cost $400 per hour.
- Cruising Extension: You can get temporary, additional coverage if you plan on leaving the USA .
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What Do You Do If Someone Hits Your Boat
According to state law, a boat owner/operator must report their boat accident to California State Parks Division of Boating and Waterways if the accident results in death, disappearance or injury to a person requiring medical attention beyond first aid, damage to a vessel or other property exceeding $500 or
Not Covered In Hull Value
Whats not covered in the hull value? ;
- Spare parts ;
- Cell phones/ iPads/personal electronics;
- All personal items: clothes, galley ware, cameras, scuba equipment, etc.
I have seen from experience that most people go with 5k or 10k in coverage for their Personal Effects coverage.
;That may be fine for your situation. But be aware, if you have a total of 20k in contents and you insure 10k, you are underinsured, and in the event of a claim may not get your full claim paid. ;
Another thing to consider is that a lot of yacht policies cover your items for their Actual Cash Value . So if you own an 8-year-old iPad, the insurance company will not pay for a new one unless you have a rider on your policy for replacement cost.;
It is a good idea to have a general list of all your contents and their value. Some people even take the time to photograph higher value items.;
It is also a good idea to photograph each bookshelf and locker as a reminder of what items were on board, in case you ever have a total loss.;
It is always better to have more documentation than less when dealing with insurance companies.;
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Boat Insurance Faqs And Guide
When summer is around the corner, its time to start thinking about how youre going to enjoy your warm, sunny days. Maybe you already own a boat or youve saved up to buy one. Youre likely eager to feel the suns rays on your skin and the refreshing spray of water against your face.
If you want to join the millions of recreational boat owners in America, youll want to consider purchasing boat insurance to protect your asset in the event of damage or theft. Boat and yacht insurance policies can vary from company to company, which can leave boat owners unsure about which are the best boat insurance policies for them.
At David Pope Insurance Services, LLC, we have developed this guide to boat insurance requirements to help you navigate the process of securing the policy thats right for you.
Limits Must Equal Agreed Value
To obtain protection from coinsurance under the agreed value clause, you must maintain limits equal to the agreed values. That is, if your statement of values indicates that the cost to replace your building is $2 million, you must maintain a building limit of at least $2 million. If a loss occurs and you have failed to maintain the limits shown in your statement of values, you may be stuck paying a portion of the loss.;
Under the agreed value clause, the most your insurer will pay for a loss to damaged property is the proportion that the limit for that property bears to the agreed value of that property shown in the statement of values. For example, suppose that you own a building that you have insured on a replacement cost basis. You have insured your building at a limit of $1.5 million. However, your statement of values indicates that the replacement cost of your building is $2 million. Your policy includes a $1000 deductible.
A severe hailstorm causes $100,000 damage to the roof of your building. Your insurer will compare the agreed value of your building to the limit on your policy. Because you have underinsured your building by $500,000, your insurer will not pay your loss in full. Instead, it will pay only $74,000.
Here is the calculation:
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Why Do I Need High Performance Boat Insurance
If you have a high performance boat, you’re most likely carrying some kind of insurance on it. But is it the right kind of insurance from the right kind of insurance provider?
Here are just a few of the advantages of insuring your high performance boat with Markel Specialty:
- Customizable coverage to suit your boating style
- Discounts and cost-effective coverage options to save you money
- Flexible payment options
- Experienced high performance boat underwriters and marine claims specialists who provide prompt, responsive service
Don’t wait until you file a claim to find out if you have the proper insurance protection for your high performance boat. Find a Markel Specialty marine agent and get a free, no-obligation quote today.
Actual Cash Value Vs Agreed Value
What is the difference between Actual Cash Value and Agreed Value?
Actual Cash Value is defined as the replacement cost minus depreciation. Depreciation is the decrease in value over a period of time, usually as a result of age or wear and tear. Replacement costis defined as the cost to replace damaged property with materials of like kind and quality.
For example, assume a car is purchased at $20,000. Five years later the car is estimated to have depreciated to a value of $10,000. The car is involved in a major accident and the cost to repair the damaged vehicle is estimated at $15,000. If the car is insured for the Actual Cash Value, you will receive $10,000 from your insurance carrier, since that is the current value of the car .;;
Agreed Value means that coverage is provided for a pre-determined amount settled upon by both the insured and the insurance company.
Agreed value is less common for your standard auto insurance policy, but may be used for classic/collector cars, and sometimes boats or motorcycles. To insure; an item at an agreed value means that the carrier accepts a value submitted by the insured and the maximum pay out, in the event of total loss or theft, is the agreed upon amount.
When consulting with your insurance provider, it is important to know how the value of your property is determined, and what amount of coverage you have in the event that you have to file a claim.
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What Does Boat Insurance Cover
Youll want to understand what types of boat insurance coverage are available to you and how each type of coverage can help you if you have to make a claim. Insurance coverage for boats may include:
Not every boat owner needs all these coverage types, so speak with your insurance agent about which coverages may be right for you.
Boats Used On Inland Waters Only
Insurance for State owned or leased boats used only on Maine’s inland waters is pretty straightforward and is entirely self insured by Risk Management. The amount of liability insurance is $400,000 per occurrence. The self insurance liability rate is based on a boat’s horsepower. The self insurance hull rate is based on a boat’s purchase value. The hull insurance provided is on an “actual cash value” basis – replacement cost less depreciation at the time of a loss. In the event of a total loss, used boat pricing guides and other resources are used to determine the approximate current market value of your agency’s boat. A $1,000 per occurrence deductible applies to both liability and hull losses.
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What Should You Look Out For When Choosing Your Policy
- Is your boat in insurable condition? Most policies will require that you have a “marine survey” done at your expense to show that the boat is seaworthy and in good working order.
- What value do you want insured? You’ve got three choices for insuring the value of your watercraft: agreed value, market value or a random value of your choosing:
- What parts of the boat do you want insured? Some policies allow you to choose which parts of the boat you want insured and for how much. For example, you may wish to reduce your premiums by insuring the hull but not the sail.
- How far can you take your boat from land? A common condition in most policies is a “geographical limit” of 200 nautical miles from Australia’s shores. You’re covered if you stay within that range, but not if you sail beyond it.
- What are the maintenance requirements? Your policy will require that you keep your boat and moorings in good working order. Find out if your insurer has specific requirements. For example, some insurers will require you to have your moorings serviced every year.
- Will you be towing your boat? If your boat is damaged while being transported on a trailer, its usually not covered by boat insurance so you’ll need to add it to your car insurance. Boat insurance may still cover you for damage to others depending on how your policy is structured.
What Happens If You Dont Have Boat Insurance
No Coverage for Losses One of the biggest issues with not having boat insurance is that you will not receive any coverage for losses that you incur. When you have a boat insurance policy, you will receive coverage for a variety of losses including theft, boat accident damage, weather damage, or even vandalism.
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What Additional Cover Options Do I Have
In addition to basic cover, insurers offer a collection of other benefits that may be useful to you as a boat owner. Here are the most common:
- Contents cover. Your typical cover doesnt protect your personal belongings. For an extra premium, you can get cover for personal items like clothing, fishing equipment, diving equipment, water sports equipment and electronics.
- Lay-up cover. If you store your boat during certain seasons, you may be able to save on premiums while its stored. With lay-up cover, you basically have two policies in one: one for the timeframe youre using the boat and one for the timeframe youre storing it. Youll be charged a little more up front, but youll ultimately save on your premiums.
- Racing cover . Basic boat insurance doesn’t cover you when you’re racing. The sailboat racing option expands your cover to protect you when you’re racing in an organised event.
- Water skiing liability. A basic boat insurance policy won’t cover you if you’re towing a water skier and that’s what caused the damage or injury. With the water skier’s liability option, you’re covered for injuries to the water skier and for any damage caused to others as a result of this activity.
What Is The Actual Cash Value Of My Boat
Actual Cash Value is the value of the boat at the time of the loss. A boat insurance company will pay the insured value or the Actual Cash Value of the boat at the time of the loss, whichever is lower. In our example, if the Actual Cash Value of the boat is $25,000, this is the most you will be paid.
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Kinds Of Boat Insurance Policies
- Boat
- Boat & PWC Rental;-;Although this is generally not required, rental insurance will help cover any damage the vessel, as well as the operator and passengers.
- Boat Clubs;-;covers all members of club while operating a boat.
- Professional ;-;These policies are very customizable and can cover items like travel to a tournament, equipment and more.
Boat Insurance Coverage Faqs
Small Boat Insurance
What is the best coverage for my boat?
It is best to have what is known as an “All Risk” policy, which will provide coverage for all types of losses except those specifically excluded in the policy. Typical exclusions may include wear and tear, gradual deterioration, marring, denting, scratching, animal damage, manufacturer’s defects, defects in design, and ice and freezing.
How much should I insure my boat for?
You should insure your boat for the amount it would cost you to replace it with like kind and quality. This is called “Agreed Value” or “Stated Value” coverage, and in the event of a total loss, will pay the full insured amount. Beware of policies providing “Actual Cash Value” coverage, which means the value of your boat will be replacement cost less depreciation.
What other coverages can I expect with my policy?
The following are standard coverages with standard deductibles and average limits:
- Medical payments, $5,000
- $1,000 limit Personal effects, $250 deductible
- Uninsured boaters liability, between $300,000 and $500,000
- $500 to $1000 limit Towing and assistance, no deductible
- $1,000 limit Fishing equipment, $250 deductible
Who is allowed to operate my boat?
I live in an area where I can’t use my boat in the winter, but my lender requires it be insured year-round. What can I do?
Large Boat Insurance
What are the differences between boat and yacht insurance?
What should I look for in a yacht policy?
What is a normal deductible?
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Does Insurance Cover Boat Sinking
Does boat insurance cover sinking? In most cases, boat insurance does cover sinking if you have hull insurance. If you have complied with all the conditions of your insurance policy and your boat sinks through covered reasons, you will be reimbursed for losing your boat less any deductibles in the policy.
Actual Cash Value Insurance
Actual cash value is a plan that takes depreciation of your boat into account. When you make a claim, your insurer will pay out an amount based on your boats current value. Your policy will allow you to receive the actual cash value of your boat at the time you make your claim, whether for a partial loss, such as collision damage, or full loss like theft.
If we use the same example above, your claim will be paid out according to your boats current value, not according to its value when you bought and insured it. Though the payout based on actual cash value is typically less than the payout based on agreed value, the deductibles and upfront costs tend to be lower as well.
To decide whether actual cash value or agreed value is right for you, consider your boats condition and usage. Those who own large, new boats often choose agreed value, while those who own a boat with some depreciation tend to choose actual cash value.
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Why Do I Need Boat Insurance
For many Canadians, boating is a chance to escape everyday life, relax, and have fun. Boat insurance lets you do all those activities with some added peace of mind. Depending on the level of coverage you choose, your boat insurance policy will offer protection against liability, collisions, fire, theft, and other unexpected accidents.
Boat insurance also safeguards you against risks that only present themselves when youre out on the water: sinking, capsizing, stranding even explosions. And with a good boat insurance policy, youll also get coverage for your marine equipment, which may include radios, GPS units, electric trolling motors, and tools.
Components Of Boat Insurance
As with any significant asset purchase, having the right insurance protection can make sure you are able to keep your investment when something unexpected occurs. With OC boat insurance, you can protect yourself from the financial liabilities that come from owning a yacht or a smaller sailing vessel. Whether from an accident or weather condition, quality insurance coverage can give you peace of mind when damage or injuries occur.
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