You Can Avoid Big Mistakes When Buying Boat Insurance

Boats come in many styles – fishing boats, personal watercraft, house boats, sailboats, jet boats, yachts and more. You’ll need to insure your boat with a policy suited to the kind of boat you have or are about to buy. The policy needs to cover the relevant hazards you face as an owner of a particular type of boat. A pontoon boat used on inland lakes, for instance, may not require the coverages you’d need for an ocean-going sailboat. Let’s take a look at the issues.

·         Do auto or homeowner’s insurance protect your boat?

·         What protections does boat insurance give me?

·         How to protect your boat with the right coverages?

Do Auto or Homeowner’s Insurance Protect Your Boat?

Somewhat.

It’s logical to think your boat is covered by auto insurance when you’re towing it on the highway, and that it’s covered against damage when it’s parked at your home. However your coverage is rather limited.

Your auto insurance includes liability coverage as required by law. If you are involved in a crash where your boat or trailer causes damage to another person’s vehicle or property, your auto liability insurance will pay for that damage. Likewise, if another person is injured by your boat or trailer, auto liability coverage pays for their medical care. In both cases payment is limited to the amount specified in your policy. However, your automotive collision coverage will not pay for damages to your boat or trailer.

Your homeowner’s insurance may provide some limited protection for damage done to your boat when it’s parked at your home, although few policies cover theft of its contents (fishing gear, motors, etc.) or vandalism. [1]

Whether you trailer your boat from home to the water every week, or only occasionally, contact your insurance professional to determine what protection your auto and homeowner’s policies give you.

What Protections Does Boat Insurance Give Me?

Boat insurance protects you from three major risks. [2]

·         Injury to others. Much like the liability coverage for your car or truck, boat insurance pays for medical expenses to others when you cause a boating accident or crash. Many policies also pay for court and attorney fees if you’re sued as well as loss of wages, pain and suffering and related expenses.

·         Damage to property. If you cause an accident and damage another’s property – a boat, boat house, or dock, for example – liability coverage pays for those damages up to the policy limits.

·         Damage to your property. Similar to the collision coverage in your auto policy, boat insurance pays you for damage to your boat and its equipment. You can choose the amount of coverage you want using one of three methods.

o    Actual cash value payout. This pays for repairs up to the current market value of your boat and its equipment. Because the value of your boat depreciates over time, you’re not likely to receive enough money to buy a new, current model year boat if your boat is a total loss.

o    Agreed upon value payout. Here you choose the amount of payout you want to cover repairs or replacement of your boat.

o    Total replacement payout. This form of payment covers repairs and, in the event of a total loss, replaces your boat with as identical a match as possible. Total replacement coverage carries the highest premiums and is seldom available on boats older that two years.

You can choose the deductible amount for each of these three types of insurance. In addition, your insurance professional can help you with other coverages against risks such as these:

·         Underinsured/Uninsured boaters. This pays you for damages to your boat if you are in an accident caused by an underinsured or uninsured boater.

·         Medical Payments. You can choose a policy limit that will pay for medical care and funeral expenses for you and your passengers.

·         Fishing equipment. This coverage pays for damage to your fishing gear and equipment.

·         Personal property. This covers damage to your personal property. Yachts, houseboats and other large watercraft that carry jet skis or dinghys need to insure those under separate policies. Personal property coverage does not protect those additional boats.

·         Roadside assistance. This provides service during highway breakdowns and may include towing.

·         Fuel spill or accident. This pays for removal and cleanup of debris and fuel resulting from an accident.

·         On-water towing and labor. If you’re stranded and need a tow back to the marina this coverage pays, and may also pay for any labor costs charged by repair personnel.

How to Protect Your Boat with the Right Coverages

In addition to these various protections, boat insurance is sold according to the type of boat you have. The insurance industry has created policies for each of these specific boats: bass boat, fishing boat (as used in charter services, for example), high performance boat, house boat, jet boat, mega yacht, personal watercraft, pontoon boat, power boat, runabout, sailboat and wooden boat. [4]

These policies each offer the three basic protections outlined above and differ primarily in what is excluded from coverage. For instance, sailboat insurance often excludes scuba and fishing gear, televisions, cameras and other personal property. However, power boat insurance usually excludes damage caused by on-board machinery or animals.

Considering the most common reasons boat owners file a claim with their insurance carrier gives you a head start on choosing the best coverage for your boat. Research shows the top eight reasons [5] for filing a claim:

Let’s Work this Out Together

Our Quoteasy Insurance professionals can help you navigate the complexities of choosing the right policy, the right options and the right deductibles for your specific boat and your target price point. We work with major carriers, giving you a choice of policies and a spectrum of discounts to keep your premiums low. We can even arrange to suspend certain coverages in the off-season to reduce your total annual cost, and can advise you through every aspect of the boat insurance puzzle. Click or call us at (305) 587-2410 – we’re here to help.

Source

(1) http://www.bankrate.com/finance/insurance/6-things-know-boat-insurance-3.aspx (2) http://www.boatinsurance.org/guide/what-does-boat-insurance-cover/ (3) http://www.boatinsurance.org/types-of-boat-insurance/sailboat-insurance/ (4) http://www.boatinsurance.org/types-of-boat-insurance/ (5) http://www.boatinsurance.org/guide/top-10-boat-insurance-claims/