WHAT IS COVERED BY BOAT INSURANCE?

About as thrilling as watching paint dry is insurance… Considering this is the last thing any boater wants to do.

Having boat insurance can also make the difference between an accident staying an accident and turning into a precipice for financial ruin.

Over the past few years, there has been a resurgence in interest in boating, and the epidemic of 2020 has led to an explosion in the number of new boat owners. As I write this, sales are up over 50% from the same period in 2019.

On the other hand, because most new boat owners are enthusiastic, inexperienced individuals who get themselves into sticky situations, insurance claims are also rising tremendously.

WHOM IS INSURANCE FOR?

Insurance is essentially the transfer of risk; in exchange for a premium (fee) that represents a small portion of the boat’s insured worth, the insurance provider agrees to financially safeguard the vessel in the event of a partial or complete loss. Due to the fact that the insured (you) is a part of a group of insured who split the cost of providing coverage, the coverage is affordable in comparison to the worth of the vessel. Money is paid from that fund in the event that a claim is made.

Honesty is required in the insurance industry. In order for the risk (you and the boat) to be appropriately considered, a new boat owner (especially on larger vessels) must be forthright and open with their agency.

Running aground, colliding with a deadhead or submerged object, or overheating an engine as a result of kelp or other material obstructing raw water intakes are all instances of sudden, direct, accidental, physical loss. We have insurance for the reasons listed above and more. Being dishonest could result in a claim not being a covered incident (called material misrepresentation).

HOW IS IT COVERED?

We must safeguard our boats as boaters against harm that we might inflict on them, other boats, and the environment. Such protections consist of:

·  The insurance coverage known as “Agreed Value Hull” or “Property” safeguards your boat against damage and satisfies the lienholder’s insurance requirements (bank loan holder). In the event of a total loss of your vessel, the settlement type “Agreed Value” guarantees payment of the face value of the policy.

·  The crucial phrase is “Liability or Protection and Indemnity.” This protection helps those who you harm, such as when you collide with another boat, drive into a pier, start a fire that damages other boats, and more. With relation to liability insurance, a greater limit is preferable.

Pollution is a different category of coverage that also includes liability insurance for any oil, fuel, and other pollutants that your boat may discharge into the waterways. Based on a federal statute that was adopted in 1990 in response to the Exxon Valdez oil leak tragedy that occurred in Alaska in 1989, (nearly 11 million gallons of crude oil was discharged into Prince William Sound). Make sure your policy includes pollution liability coverage in an amount equal to the $997,100 limit currently required by the federal government.

A personal liability umbrella policy is a policy that provides extra protection for your personal belongings, but it does so as “excess coverage,” meaning that the liability protection provided by the insurance policies for your car, house, and vessel must first be used up before the umbrella policy kicks in. It should be noted that a typical umbrella policy does not cover certain marine-related hazards like salvage, wreck disposal, or pollution.

IS “EVERYTHING” COVERED, AND WHY DOES INSURANCE APPEAR TO BE SO PRICEY?

Never hesitate to ask your agent direct questions regarding the policy. Always read and check your policies to ensure that you are aware of the terms of coverage. It is important for the policyholder to comprehend the policy and consult their agent about any unclear provisions because no vessel insurance policy will completely cover all eventualities. In terms of the policy they represent, the agent is (or should be) the subject matter expert, and any policy should take into account how the vessel will be utilized. When your navigation is from Seattle to Desolation Sound, it makes no sense to have a policy with comprehensive West Coast navigation.

Actuaries now thoroughly examine the outcomes of all insurance lines, including yacht insurance, using more advanced data analysis and modeling. The year, make, model, and purchase price of a vessel, the type of fuel onboard, the vessel’s construction (fiberglass, wood, metal), the type of propulsion (inboard or outboard, power or sail), the boat’s top speed, its navigational area, the owner’s experience (or lack thereof), loss history, and other factors all affect how much a policy will cost. The annual premium is determined by weighing all of the factors. As each policy is customized to the individual and the vessel, there is no genuine “rule-of-thumb” for insurance costs, therefore depending on the knowledge of a friend or dock mate as to the cost of coverage is absolutely pointless.

THE PACIFIC NORTHWEST: BOATING

From Olympia to the northernmost point of Vancouver Island, our boating area is enormous. Whether you cruise north via the inside channel to Desolation, the Broughton Archipelago, or a circumnavigation of Van Isle, coverage can be adapted to your preferred route. Due to their remoteness, the more difficult navigation on the west coast of Vancouver Island or the navigation to SE Alaska will be very carefully examined by underwriters in terms of vessel capability and owner experience.

Your tender is protected as part of the main vessel as a matter of policy if it is working for the main vessel.

WHO DISPOSES OF THE BEST POLICY?

Contrary to what many people think, there is no “optimal policy.” Each insurance provider has specific requirements for providing coverage as well as a different appetite for risk. On a 45′ yacht, Company A might be okay with a first-time boat owner, but Company B needs a lot of expertise to weigh the danger. The optimal policy is the one that most closely satisfies that specific boater’s wants.

WHO CAN I GO TO FOR HELP WITH INSURANCE?

You should get to know passionate, experienced and qualified marine insurance professionals and providers, whether they are knowledgeable personnel or another company specializing in marine insurance https://call-tracking.org/. The shipping agent should interact with you to better understand your needs before recommending the right insurance rate for you based on coverage rather than price.

Those of us who were fortunate enough to grow up on or near boats understand what a wonderful way of life boating is. What makes boating so unique is being able to share that passion with close family and friends in an often hectic environment. No matter how the yacht insurance market develops, we are convinced that if you deal with a skilled marine insurance specialist, you will be able to acquire the necessary protection for your legacy, investment, and experiences without hitting any snags.