Helpful Information About Boat Insurance
Its every boat owners nightmarewhat starts as a beautiful day in your boat with friends or family can take an unexpected turn, ending up in a collision with another boat, a reef, or a buoy. This could result not only in liability expenses and boat repairs, but in medical expenses if someone onboard gets hurt.
In 2019 the US Department of Homeland Security and the National Coast Guard reported a total of 4,168 boat accidents and an estimated $55 million dollars in property damage as a result of recreational boating accidents. The same annual report shows that the top five factors contributing to accidents had to do with operators’ inattention, improper lookout, inexperience, excessive speed, and alcohol use.
Boat owners also encounter other non-accidental incidents in the water such as breakdowns, motor malfunctions, or even fuel spillageevents that may leave you stranded, and requiring specialized services that boat insurers can cover for you.
So while sailing is full of adventures, it also poses many hazards for you and your boat. Therefore, the matter in question is not whether you need boat insurance or not, rather what type and how much coverage you should get.
How We Chose The Best Boat Insurance Companies
- Strong financial outlook. We looked at organizations that rate financial security, such as AM Best, Moodys and Standard & Poors, to ensure that our picks would be able to pay out on claims at all times even in a large regional disaster.
- No third-party underwriting. We also wanted insurers who service their own policies. Theres too much room for error when another underwriter gets added to the mix, and less accountability as well.
- Available to all. Our top choices are available in all 50 states, and dont require any sort of membership to purchase a policy. Larger, open-to-all companies frequently offer lower rates, better discounts, and a greater range of coverage options.
- Agreed-value policies. Although actual cash value policies are often cheaper, agreed-value policies provide better coverage thats going to result in a larger, more useful payout after a claim. All our chosen picks offer it.
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Financial Strength & Reputation
Before choosing an insurance policy, be it for cars, homes, or boats, you should verify if the company will be able to pay out claims in the future. The best way to ensure this is to look at their financial strength according to the rates they receive from credit rating agencies such as AM Best, Standards & Poors, and Moodys.
Another thing that can guide your decision of whether or not to purchase a policy from a given company is checking their reputation among customers. You can do this by looking for patterns in complaints and at customers’ overall satisfaction, ratings, and comments in customer review websites.
Choosing The Right Boat Insurance Company
Among insurance companies, you have two main, large categories to consider with boat insurance: traditional large, national companies and marine insurance companies that specialize just in watercraft and boat insurance.
While a company specializing in boat insurance may offer options that are well-suited to your needs, you may save more money if you go with a national company. Many national companies will let you bundle multiple policies for discounts.
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Do I Really Need Boat Insurance
Theres no known law mandating you to have a boat insurance cover before you can use your luxury yachts on large oceans or your kayaks in small waters.
But inasmuch as it is not a legal requirement, we often recommend that you have it so that you can protect your boat and those onboard your boat in case of any damage, theft or accident.
Be that as it may, some states in the United States of America might need you to have one. California doesnt mandate you to have boat insurance but you must reach a minimum age before you can allowed to use a boat.
Even if your state might not mandate you to have a boat insurance cover, your bank will, especially if you took a bank loan. The level of boat insurance cover you will get must be enough to cover the cost of replacing the boat with a new one should they be a case of accident or theft.
Insuring Possessions Away From Home
Make sure you check the cover youre buying is adequate for your possessions and pay attention to any exclusions and security clauses listed.
You may also be able to take out cover for personal possessions under your home insurance policy, but probably not for items kept permanently aboard or attached to your vessel.
If you tow your boat from place to place or store it on wheels, trailer cover is worth considering.
Trailer insurance will cover you for damage or loss of your trailer and may include public liability insurance in case your trailer causes damage or injury to others.
Note that third-party boat insurance doesnt usually apply while your boats being towed, as your car insurance should cover you for third-party damages while towing.
Cover to take your boat abroad
If youre the adventurous type, you might want to take your sea-going vessel to foreign shores.
This might not be included as standard on your policy, but you may be able to add it for an extra charge.
Make sure you check any territorial limits to your cover before you travel and whether you need to request translated copies of your insurance documents.
Personal accident cover
Although boating isnt perceived to be a particularly risky activity, accidents can and do happen.
Personal accident cover should provide a payout to help with your recovery if youre injured aboard.
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Best Boat Insurance Of 2021
Rates starting at around $21 per month
Great coverage including many extras
Limited info on restrictions and exclusions to coverage
Allstate offers a very comprehensive lineup of options for boat coverage, including:
- Watercraft liability coverage
- Additional equipment and personal effects
- Trailer coverage
- Emergency services
- Agreed value
Even though Allstate offers boat coverage starting at about $21 per month, it doesnt shy away from discounts. You may qualify for the following when you insure your boat with Allstate:
- Multiple Policy Discount Up to 20% off when you combine your boat insurance with an Allstate homeowners policy
- Full-Pay Discount 10% off for paying your full premium upfront
- Homeownership Discount 10% off for owning a home
- Boat Education Discount 5% off when you take an approved boater safety class
- Easy Pay Plan Discount 5% off when you enroll in automatic payments
Unlike other insurance companies, Allstate places very few limitations on its boat coverage. However, some types of coverage and discounts are not to be had in all states, so its best to contact a local Allstate agent to verify the availability of coverage and discounts before switching over to Allstate for your boat insurance.
Allstate offers the best of both worlds to its customers: local agents to help you with your insurance needs, as well as online tools and an 800 number to get questions answered anytime.
How To Save On Boat Insurance
If you know where to look, there are ways to save on insurance. First, take a boating safety class. You do want to check with your insurer to make sure you choose a course that qualifies you for savings. Taking a class can save as much as five percent on a boat insurance policy.
Consider adding some safety features, which can also help reduce costs. And dont get more insurance than you need. Choose a policy that specifically fits with your boat and your needs. If you have a boating license, or you cover it under certain types of protective structures, you may be eligible for discounts.
Also, keep in mind that your auto driving record can factor into how much your boat insurance costs. Finally, dont forget about bundling options offered by many insurance companies. That can be one of the main benefits of going with a larger company over a company that specializes in marine insurance.
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Is Boat Insurance Required
*Boat and PWC coverages are underwritten by GEICO Marine Insurance Company. The TowBoatU.S. Towing Coverage Endorsement is offered by GEICO Marine Insurance Company, with towing services provided by the BoatU.S. Towing Program. Towing coverage only applies to the insured watercraft. This endorsement is not available in all locations and is subject to certain restrictions. Towing coverage is subject to availability and service may be restricted based on the location of the insured watercraft or trailer. Please speak to an agent to discuss details of towing services, limits, exclusions and coverage availability.
The above is meant as general information and as general policy descriptions to help you understand the different types of coverages. These descriptions do not refer to any specific contract of insurance and they do not modify any definitions, exclusions or any other provision expressly stated in any contracts of insurance. We encourage you to speak to your insurance representative and to read your policy contract to fully understand your coverages.
BoatUSâBoat Owner’s Association of The United Statesâis the nation’s largest association for recreational boaters providing service, savings and representation for over 50 years.
What Does It Cover
Actual Cash Value vs. Agreed Value
Boat insurance providers offer physical damage coverage in two primary ways: actual cash value and agreed value. Out of the two, an actual cash value policy will be the least expensive, because it covers the current value of your boat at the time of the accident, minus any depreciation. Whereas an agreed value policy will cover the amount listed in your policy, as agreed with the insurer at the moment of purchase regardless of how the parts might have lost value over time.
Policy coverage options vary depending on the insurer, nonetheless, companies usually feature services such as:
Liability Coverage: Usually, the most basic coverage. It protects you from at-fault damages caused to another boat or property.
Medical Payments: Medical coverage will pay out for medical expenses that you or any passenger onboard experience as a result of an accident.
Salvage: Salvage coverage is also known as wreckage removal. Simply put if your boat wrecks in the water, the insurer will pay salvage costs.
Pollution Liability/Fuel Spill: According to the Oil Pollution Act of 1990, polluters are responsible for the costs related to oil spill clean-ups and environmental damage. This type of coverage will protect you from expenses resulting from accidental contamination.
Additional Coverage Options
Most insurers also offer additional coverage options that may come handy in specific situations:
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How To Get The Cheapest Boat Insurance Policy
How do you get the cheapest boat insurance policy? What exactly is boat insurance and why do you need one? And what can you do to lower your boat insurance cost in the UK?
In this article, we will walk you through all you need to know about boat insurance, why it is not a legal requirement yet important and how to protect your finances.
Boat Insurance : To Insure Or Not To Insure
While insurance for your boat is not a legal requirement, a wise boater takes the time to get educated on the benefits of a policy that protects not only property but liability too. So we turned to a marine insurance veteran and former Boating BC board member Paul Mendham, CIP, President of Navis Marine Insurance, to teach us the basics.
Ive seen lots of crazy things, says Paul. Boats sunk and docks collapsed by a big wake, or damaged in heavy snowstorms. Many people think they dont need insurance because they are careful, or that nothing will happen to them. Well, stuff happens and then youre the one writing the cheque!
According to Paul there are two good reasons to insure your boat: to protect your asset, and your net worth arising from liability. If you get into an accident, and cause property damage or hurt someone, without insurance everything you own can be at risk.
What kind of insurance do I need?
That depends on what kind of boat you have. A canoe or kayak low value, no horsepower and little liability – can be easily added to your home insurance policy. But if you have a powerboat, or a larger sailboat you need a dedicated marine insurance policy. All risk policies cover you for most types of losses, but there are exceptions, so be sure to read the fine print.
Where should I buy my insurance?
What should I ask my broker?
Its great to be prepared, so heres what I would ask:
Why is liability insurance important?
When should I buy my insurance?
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Progressive: Best For Cheap Boat Insurance
Rates as low as $100 per year
Wide array of coverage
Restrictions on types of boats covered
Strict coverage limitations in areas with hurricane risk
As expected from one of the industry leaders in personal property insurance, Progressive offers all of the major coverage and more, including:
- Bodily injury and property damage liability
- Comprehensive coverage
- Propulsion Plus mechanical breakdown coverage
- Sign & Glide on-water towing
- Fishing equipment or carry-on items
- Water sports injury coverage
- Fuel spills and wreckage removal
- Roadside assistance and trip interruption
- Full replacement cost
You can potentially save even more with Progressive by qualifying for some of the following discounts:
Additionally, Progressive offers these perks that help customers save on their boat insurance over time:
- Small Accident Forgiveness This prevents your rates from increasing if you end up in a boating accident with a claim under $500.
- Large Accident Forgiveness This prevents your rates from increasing after an accident if youve previously remained accident free for three years.
- Disappearing Deductible Your deductible lowers by 25% for each period you remain claim free until it finally reaches zero.
Progressive boat insurance is only available for boats up to 50 feet in length, and in some states that experience higher hurricane risks, the limitations are 35 feet and $175,000 in value.
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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How To Choose A Boat Insurance Provider
- Get a better rate with membership: boating organizations such as Boat U.S. or NBOA will help you find the best policy for your own circumstances, and youll also be able to take advantage of their extra perks and publications.
- Get quotes from several providers. Every insurer has its own formula for determining premiums, so it pays to get quotes from a variety of sources. We suggest starting with our four recommended companies and then looking at a few regional insurers as well.
- Choose between actual and an agreed-value policy. Actual cash value insurance will take the depreciation of your boat into account meaning you may net considerably less on a claim than you need to purchase a new watercraft. Agreed value is when you and your insurer agree on a permanent value for your boat, and depreciation is not taken into account when you make a claim.
- Know what boat insurance doesnt cover. You may be surprised at what your policy doesnt cover. For example, most policies wont payout for damage caused by wildlife, from sharks to zebra mussels. Hull corrosion is also rarely covered unless you have an additional rider that will cover salvage and replacement of your boat.
What Does Boat Insurance Typically Cover
Boat insurance coverage will depend on what type of boat you have, what insurance provider you use, and what coverage youre willing to pay for. General boat insurance typically covers physical damage to your boat, as long as none of the restrictions of the policy were violated, and liability coverage for damage to other property caused by you while operating your boat. You can add additional coverage types, such as medical payment for injuries you sustain while on the boat.
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