Boat Insurance Checklist
Questions To Ask Your Agent About Your Boat Insurance
It's not always the best idea to get the least expensive boat insurance you can find. Boat insurance policies can vary widely in what they cover and how they cover it, and the big insurance companies that you trust with you car and homeowners insurance aren't necessarily the best ones to insure your boat.
Many insurance agents, particularly if they don't have extensive experience with boat insurance, may not be aware of the special insurance needs of boaters. Check with your insurance agent and make sure you know the answers to these questions about your boat insurance before making a decision:
- Does the policy include replacement coverage, and is it "agreed value" or "actual cash value"?
"Agreed value" coverage for your boat and engine means that the coverage value for replacement is decided and agreed upon by you and the insurance underwriter at the time you purchase the policy, with no reductions for depreciation. This means that in case of a claim, your policy will pay for repairs or replacement on a replacement cost basis — you will receive "new for old." If the loss is considered total, the insurance will pay the agreed value as reflected in your policy, minus your deductible.
Some items that are subject to appreciable wear and tear, such as canvas covers, sails, trailers, and some mechanical equipment, may still be subject to depreciation, despite having agreed value replacement coverage. This is common and accepted practice.
Don't let your agent talk you into saving a few dollars with an ACV, or Actual Cash Value, policy. ACV policies generally have lower premiums, but they cover your vessel only up to the current market value of the boat at the time of the loss, after taking into account depreciation and the condition of the boat, along with your deductible.
- Is the coverage "all risk"?
All-risk coverage is far more comprehensive than more limited coverage that covers "named perils," in which the policy only covers specific types of damage that are listed in the policy. All-risk policies, in contrast, cover everything except certain exclusions which must be listed in your policy.
-
Are your outboards, dinghies, tenders, and electronics included?
Clearly you want these items covered, as they are expensive to replace and too easily damaged or stolen. It's common for such items to be included in a policy but with a separate lower deductible. The lower deductible can save you money, but discovering that your stolen dinghy or expensive electronics aren't covered at all would be a most unpleasant surprise.
-
If you keep your boat in a northern climate, does the policy cover damage due to ice and freezing?
Harsh winter weather can wreak havoc on boats if they are frozen in or damaged by ice. If this type of damage is a possibility for your boat, you want to be sure you're covered for it.
-
Does the policy include marine liability protection and indemnity, uninsured boater coverage, and medical payments for you and your guests?
These coverages in a marine insurance policy tend to be broader and provide greater protection than a typical homeowners liability policy. Find out the differences, so that you can make an informed decision about exactly what coverages you need.
-
Exactly what navigation limits are defined in the policy?
Be sure your policy covers you and your boat for the geographical areas where you plan to use it. Some boat insurance policies don't cover your boat past the 12-mile international water limits, or limit the countries you can visit while cruising. This can be a particular problem for cruisers who enjoy exploring the Caribbean and South America; you might find that you're not covered if you enter the domestic waters of many of the small island countries in the Caribbean. Likewise, boaters in the northwest may find that crossing from U.S. waters into Canadian waters renders your boat insurance worthless.
-
Is coverage included for towing and emergency assistance?
These should be included in all boat insurance policies. Also find out what limitations are defined in the policy for towing and assistance. It's one thing to have tow coverage when you're a couple miles offshore, but if you're 1,500 miles into a trans-Atlantic cruise, it's unlikely your policy will cover a tow.
-
Does the policy include coverage for salvage, wreck removal, and expenses required to defend your boat against salvage by others?
Having marine insurance that includes these important coverages can make a big difference if you ever have to "abandon ship." Your policy should include coverage up to the full amount of insurance on the hull. Know the maritime salvage laws and how they might affect your boat if you have to abandon it. Many insurance companies that don't specialize in marine insurance may omit these coverages.
-
Are your personal effects and gear covered?
Does the policy cover loss or damage to your rods, reels, and other tackle, stereo, computer, water skis and wakeboards, and other possessions that aren't permanently attached to the boat?
Personal gear that may or may not be covered under your general boat insurance property damage coverage include:
- Dinghies
- Outboard engines and trolling motors
- Handheld or portable electronics, including handheld GPS and fishfinder
- Anchors
- Oars
- Portable fuel tanks
- Tools and replacement parts
- Waterskis, wakeboards, and tubes
- Life jackets
- Anchors and oars
- Canvas covers and removable biminis, T-tops and canopies
- Galley equipment
-
Are there limitations on who can operate the vessel?
-
Are the liability coverages sufficient to protect your assets and savings?
-
If you have a sailboat, are the sails and rigging covered?
-
Is the boat covered while being trailered and launched?
-
Is your trailer covered?
-
Can you get a discount if you complete an approved boater safety course?
- Does the policy include coverage for emergency repairs to prevent further damage?
|
|
