General information on boat insurance.
Boat insurance is the next thing you should focus on after buying a boat or a watercraft. You are a responsible boat owner if you don’t stop with just the purchase of a boat. A boat is a serious investment that will cost you a lot of money when something happened while you are using it or while you are on the water, or there is a repair that you need to complete with your boat. By knowing what is the risk of not having insurance versus having insurance, you have an advantage when you own a boat.
There are insurance factors that have to be considered on the water vessel and will also answer the question of how much is boating insurance?
The factors will include most of the following :
- Boat or vessel’s age
- Where the boat is to be used
- Condition of the boat
- If the owner uses the boat as his primary residence,
- Is the boat homemade and has no serial number
- Houseboats that has no motor
- Length of your boat
- The speed, condition, and the boat’s horsepower
The places you go to with your boat will determine what type of insurance coverage you will need. There is an all-risk policy that is said to offer the best protection, although this does not cover each type of loss. Marring, denting, wear and tear, animal damage, some defects from the manufacturer, freezing, design defects may be excluded from the all-risk policy. However, adding extra coverage is the smartest thing to do, such as personal effects, towing, and assistance, just to name a few. At the same time, any attached equipment on the boat may be insured, such as the oars, trolling motors, tools, seat cushions, life jackets, and other special equipment.
There are also types of Boat Insurance Coverage that are considered add-ons to most types of policy, such as.
Towing requirement – When your boat requires towing from one place to another. This will cost the owner as they bill it hourly.
Eventful Damage – In cases that your craft got damaged because of corrosion and rotting, the insurance will cover the loss.
Unusable craft – insurance covers the loss of use of your boat and will provide another vessel for you to use.
Journey/navigational extension – This is another additional coverage that can be given temporarily when you have plans of leaving the USA to sail.
Salvage insurance – This is where an insurance company will take care of boat removal when there is damage to your boat that can be minor to extreme.
Indemnity and security – The insurance that covers towing, wreck removal, legal fees, damage because of pollution, other accidental damages.
Security apparatus insurance – Some boats have the highest tech and expensive security system that is just ideal to be insured, in cases of theft, damage, and the likes.
Environmental insurance – When your boat is pointed out as the cause of pollution, this add-on insurance will cover the damages.
Medical Insurance – Insurance that covers you in cases of injury while you are using your vessel or your boat.
Why is it important to have boat insurance?
It is as important as car insurance and will surely keep you away from any lawsuits and will act as your investment protection.
Lawsuits are everywhere and are very common that when you thought you are out in the clear, someone will suddenly file a lawsuit against you. When a friend asked to come with you sailing, and even if you did not invite him, but you still let him in your vessel, if something happens to him while he’s in your boat, and he sued you for it, it will cause you thousands of dollars. If you have insurance, the company will cover the expenses and damages, and you will not spend a cent.
Insurance is important to protect your investment, in this case, it’s your boat. There can be several incidents such as a storm that can total your craft or sink it, or there may be some people who smash and damage your boat, for no apparent reason, you are protected by the insurance company, and will pay for all the damage or loss the incident incur.
When you need to pay up for damages to property, there can be an incident where your boat must have caused some damages to another person’s boat, and you have to pay for repairs and such. But with boat insurance, you got it covered.
When someone else is driving your craft, and you gave them permission to, when something happens to them while they are using your boat, or they have damaged someone else’s property, the insurance company will see that you will not be liable or pay up for anything.
In cases of accidents and you are injured and so are your passengers, you will not spend any money on medical bills and other expenses that go with it.
The various boat insurances in the USA.
There are different boat insurances available for an array of watercraft in the USA and involves
Yacht – Vessels that are 27′ and larger. There are specialized insurance for yacht because of their capacity and use in the water as well.
PWC or personal watercraft – Although some states do not require insurance to operate some personal watercraft, it is up to you to have an insurance backup in cases of accident, injury, or destruction to property.
Sailboat Insurance – Protection against physical damage and other unique coverage features. Additions will depend on the options provided by the insurance company.
Boat Clubs – While any member of the club is operating a boat, there is this type of insurance.
Boat – Water vessels that are 25′ and below are called boats and also have specialized insurance coverage.
Charters, Professional, Fishing Guides – Insurance available for these types may vary and will depend on the insurance company.
And then there are the two basic types of Boat
Insurance depending on the value of the vessel
Agreed Value Policy – The value of the boat will not depreciate. When you need to take on the insurance claims, the original cost you have listed when you insured, will be the agreed value.
Actual Cash Value Policy – The value of the boat will be determined on the time you need to take out on the insurance. So if you have been using your newly acquired boat for three years, there will be depreciation.
In which country it is the best to register the boat/ship and get an insurance?
It is allowed to have your boat, ship, or yacht registered in another country as long as it meets legal requirements.
It is the prerogative of the owner where they want to have their craft registered, and most of these owners look for an offshore registry in countries where it is relatively easy to have the registration procedures as simple as possible.
With the many operating costs and maintenance, the programs by other charter companies help the owners reduce the cost of maintaining a vessel by taking care of the insurance, maintenance, dockage, which helps in about seventy percent of the operating costs of the boat, ships of yachts.
Although it will cost owners to have their vessels registered by spending less, it is a must-have to get lawyers that know international maritime law takes care of the process.
Here are foreign countries where registration is allowed with the inclusion of insurance.
Cayman Islands – The Red Ensign is the Cayman’s Flag and considered popular among yachts. Other countries that also have the Red Ensign includes Anguilla, the British Virgin Islands, Isle of Man, Bermuda, and Gibraltar. Benefits these countries offer are not just the low registration costs but also less or no taxes and lesser bureaucracy.
Here are the best countries to have your boat, ship, or yacht registered.
Here, owners can register for a one-year or three-year program. Private yachts that are qualified to charter in the said islands must have a minimum of a safe manning certificate. A yacht that is under construction can already get a US cruising permit. Yachts that are registered here in these islands can charter in Europe.
Boats that are registered here have the prestigious Red Ensign and can enjoy privileges under the British Flag.
With the country’s low registration costs, the largest ship registry in Europe. Ships can be registered, under a name of a citizen or company of whatever nationality. They give the owners of large yachts incentives such as no tax payment on any income they generated with their works and the exemption in VAT payments. Visit this website for info’s about Malta and the registration of boats and ships.
The first tax-free countries in the world and has one of the simplest and fastest ship registration with almost 4K ships registered that also add up to the income generated by the country per year. Crew nationality has no restriction or where the ship is made, is also a non-issue.
Advantages of a boat insurance.
When you have boat insurance, you will have the following advantages :
Covers property damage – This is too costly and can even make you spend more than the actual costs of your boat. There are boating incidents that some said did not imagine happening to them. The worth of property damage is immense, plus the transporting and towing of the damaged craft will cost you. With boat insurance, you can rest easy because you are covered by the steep bills.
Protection for you and your boat guests from injuries incurred from boat accidents – Some deaths and injuries happen in a moving boat, and this will create an enormous problem for the owner just by paying medical bills and to finance the other expenses relating to boating accidents. When your guests are injured while they are on your boat, you can get all expenses paid by the insurance company.
Liability coverage – So, some owners may not yet too confident in handling their boats and suddenly caused an accident in the water involving another boater. When you are found at fault, you will need to cover all the damages arising from the incident which can be too expensive that can even leave you broken.
Insurance coverage is affordable and needed
With the many discounts, the owner can get from having their boats insured, every owner can have their boats secured.
What is the average cost of boat insurance in the USA?
The average boat insurance cost can run from a few hundred dollars up to a thousand dollars per year.
The price will depend on many factors such as the type of the boat, the profile, and largely on the following
Boat usage and the frequency – If it is just an occasional use for fishing trips and such, the rates will be lower as compared to vessels being used for parasails and other water activities.
Frequency of claims – If the owner has had claims for two to three or more in the past, this will also adjust the rate of the insurance and make it higher.
Motor vehicle driving record of the owner – An owner who has had records of bad motoring skills may have bad boating skills as well, and this will also determine the rate of the insurance to be paid.
The owner’s credit record will also come into play in determining the insurance rate of his boat. If he has good credit standing, there is a big possibility that he will be charged less.
Age and Gender of the owner – Typically the women are quoted with better rates compared to men.
Other people who will handle the boat being insured – This will also determine the insurance rate where some people added as drivers, the more the policy will increase the rates.
What safety measures you have – Are there safety materials on the boat, such as fire extinguishers and radios, to communicate on the mainland for any emergencies? Has the boat owner taken any safety course, and is he certified?
Your boat’s specs – The insurance rate will also depend on the make, model, year, and the inboard or outboard motor. They will also consider the horsepower of your boat, the idea that boats with higher horsepower will have a higher insurance premium.
Boat storage – Where you will store your boat is highly important in determining your insurance rate. They will charge boats that are stored in a safe shed or storage area less, while vessels that are found in hurricane, storm-prone areas, will have additional insurance charges.
Where will you be using the boat? – If the area where you are planning to use your boat, has natural hazards and is often visited by hurricane, storm, among others.
It is ideal to look for the boat you like and the insurance that you can afford to come with it. Some owners have a shop around first for their craft and check the rate of the insurance to know whether they can afford it.
What they did is to have at least three options for the boat they like, then have it quoted for an insurance policy from different insurance companies. This way, you have a better grip on your budget and what you can afford for the following years, not just with the boat’s maintenance but also with its insurance expenses.
Here are the top 5 boat insurances and what makes them different from the rest.
The company is well known for offering a variety of options, depending on what you can afford. They also have the most affordable boat insurance as some of their premium starts at $21 to $25 a month. They also offer different coverage and add-ons for some owners who want to have more peace of mind with their precious boat.
The company has also started what they call an Easy Pay Plan, where owners can have the premiums deducted from their checking account in exchange for a 5% discount. For owners who can upfront the whole yearly amount, they get to enjoy a 10% discount by doing so.
Also, those who have a home policy with them can enjoy the 20% discount if they combine it with boat insurance. Not bad for those who are looking for affordability and stability.
Some coverage includes
- Repair costs
- Medical Payments
- Watercraft liability coverage
- Trailer coverage
- Emergency services, such as labor, fuel, towing, etc.
- Additional equipment and personal effects
There are online tools and a hotline number where you can have your inquiries answered by local agents. There are many videos and infographics that old and new boat owners can access anytime.
United Marine Underwriters
This company has been in the business for over 28 years and is continuously serving its clients by giving them the best insurance option in the market. Although the company has been insuring just boats alone, they have high liability limits of up to a million dollars, plus they offer a discount for those owners who have undergone safety courses before the boat insurance.
A policyholder will also not have issues with his policy because there will be a duly assigned person who will take care of the insurance service he has gained from the company, and he will always have someone to answer his queries.
- Collision coverage
- Roadside help
- Bodily injury coverage
- Medical payments coverage
- Property damage liability
- Fishing Equipment and personal effects
The company also has a ready website where you can read on about policies and learn more about it. There is also available expert information where clients and customers can read on about boat related topics plus FAQ sections.
The best insurance company to have on bundled policy so you can enjoy huge discounts of up to 25%. If you have a home, vehicle, or life insurance policy, this is where you can add the boat insurance policy, so there are other perks such as roadside help, optional towing, plus reimbursement for rentals.
Nationwide have a variety of insurance options where you can also get coverage for your personal effects from three thousand and up while towing coverage is high at two thousand five hundred dollars. When you have valuable fishing equipment, they also cover these up to ten thousand dollars. They call these Weekenders, Overnighters, Light Tackle Anglers, DeepWater Pros.
There are various discounts you can get, such as when you insured many boats and if you have a diesel fuel, when you paid in full, a claim-free renewal period, and for attending boater safety class.
If you are finding ways on how you can save further, getting Nationwide insurance is a great choice.
- Collision coverage
- Medical payments coverage
- Roadside assistance
- Bodily injury liability
- Property damage liability
- Foremost Insurance Group
- Fishing Equipment Insurance
- Personal Effects Insurance
Clients can access their website and mobile app, which can make things easier for you as you manage your policy online. The company is upgrading its online portal to make access to each insurance policy available.
Foremost Insurance Group
This company has been in the business for almost a century and has been providing boat insurance in all 50 states that are considered affordable. They have special coverage for services such as towing services, pet coverage, hurricane haul out to safety, pollution liability coverage, trip interruption service for an additional premium.
You may have questions about added services or premiums, and you can ask for it, and the company will have it for you.
The company also offers different packages that let boaters have options to choose from, such as Saver Package, Plus Package, Pontoon, and Poontoon Elite Packages, Personal Watercraft Insurance, Performance Package, just to name a few.
Discounts can be enjoyed, and Foremost has a long list of it for their valued clients.
- Personal liability
- Uninsured watercraft
- Payments for medical expenses
- Roadside assistance and towing needs
- Damage to personal properties
- Watercraft physical damage
Foremost, at the moment, don’t have their own mobile app, but they are working on this. What they are focusing on is the betterment of their insurance coverage package and discounts that they can further offer to their clients. Also, they are trying to make things easier for their clients, to further customize their boat insurance coverage.
An insurance company that is well-trusted in the whole of the United States. They also have competitive pricing for all their insurance coverage. They have a different boat policy not just for small vessels, but also for those that are fifty feet long and have considerable values.
Their discounts are many as well, from Advanced Quote Discount, Association Discounts, Pay-In-Full, Prompt Payment, Original Owner Discount, just to cite a few.
Boat owners can also enjoy these perks to save on insurance, such as Small Accident Forgiveness and Large Accident Forgiveness and the Disappearing Deductible. These are savings that customers can take advantage of and can be discussed with the company further.
- Collision coverage
- Bodily injury
- Property Damage liability
- Uninsured Boater
- Insured Boater
- Medical payments
- Fishing equipment
- Water sports injury
- Roadside assistance
- Trip interruption coverage
- Full replacement cost
Progressive allows freedom and less restriction on their boat owners by letting them sail in as far as 75 miles off the coast, in any lakes or rivers found in the United States, unlike in other insurance companies where there are navigation restrictions. They also do not require their would-be clients the navigational plans and marine surveys that would cost the customers hundreds of dollars to provide.
The company also provides a variety of online tools and features that can be accessed by their numerous customers, and a Name Your Price Tool and mobile app. The owners appreciate this feature as they can change their itinerary and travel plans within the United States without any issues.
What damage is the boat insurance liable for.
Here is the list of typical damage that boat insurance cover and is liable for such incidents.
Top Insurance Claims
- Wake Damage – An operator of a boat will be responsible for his wake. They generally recognize it as the fault of the operator when a vessel causes damage to a moored vessel or any other vessel in particular, or if it has harmed any person.
- Boat Theft – Since boat theft is increasing, there is peace of mind in having your boat insured for such.
- Fire – Whenever there is a fire incident, and an explosion in your boat, there is immense damage that would surely be expensive.
- Grounding – For incidents of grounding, you need a backup for such for any injury or damage.
- Theft of Equipment – Theft is also another arising problem that insurance can cover that.
- Sinking – When your vessel suddenly has issues of damage to the boat floor that causes it to sink, with boat insurance, it can be towed to safety, and they cover you for everything that needs fixing.
- Collision – With collisions, there would be damages, also personal injury that may cost you a lot of money without insurance.
- Hurricane – Forces of nature that cannot be controlled, but your boat can be protected as long as you keep it in a safe place.
- Striking Submerged Object – anything that is underwater that is hit when a boater passed by is another insurance claim waiting to happen. Best to be ready.
What damage is the boat insurance NOT liable for.
Whatever is not converted in your boat insurance is called exclusions, and covers the following :
Owners do unusual neglect to their boats, such as letting it get infested with bugs and rodents that brought about damage to its parts or components. Your boat insurance will not cover this.
When someone else uses the boat, and they are not listed in the insurance policy or those drivers named when you are applying for the insurance. When your boat got totaled while someone else is using it, they will not shell out for your boat’s repair or any damages it incurred.
Limits to Navigation means you will not be covered if you sail out to off-limit territories. Make sure where you are only allowed and where your insurance will only cover you.
When you join a boating race competition, and you have not informed or ask for supplemental insurance for it, the insurance company will not be liable in cases of collision or damages during the race.
It will not cover accessories that are not included and not stated. Before you go out buying things for your boat, make sure that it will get covered, otherwise, you are buying and installing these accessories at your own risks.
There are chances that when you sail in different bodies of water, you can get to encounter sea creatures that may affect your boat to the point that it can cause damage to it. When by chance a shark topples your boat and it got damaged and everything inside it, this is not included in your insurance.
Gradual wear and tear and deterioration over time will happen to your boat. You need to maintain your boat and have it checked from time to time, otherwise, it will deteriorate faster than it’s supposed to. If you are also keen on exploring saltwater areas, know that frequently cleaning your boat afterward is ideal to keep your boat from rusting and corroding fast.
Parts that are faulty and require repair or replacement are also not covered since it deteriorates over time, you are responsible for having it cleaned, and repaired to keep it in top shape. But if these parts are damaged during a storm or collision, they will cover these.
Incorrect storage and transportation during the off-season is another no-no for insurance coverage. When you are reckless while transporting your boat from one area to another and it causes damage to your boat, the company will be covering nothing, and you have to shell out your own money for repairs.
Is the boat insurance also liable for personal injury?
Boat liability insurance can cover personal injury caused to another person because of your watercraft use, where medical bills and expenses are covered instead of you getting money out of your pocket.
It does come with a limit, which is the maximum amount an insurance company may only pay for a covered claim.
There is, however, no coverage for your medical bills after an accident. You may need to get another form of insurance for such, so it will cover all your medical expenses.