Boat insurance is not required in every state but it is required by most marinas and boat yards in order to have a watercraft berthed. Because insurance is not required, there will be some folks who opt not to get it, which makes it even more important to protect yourself and your assets.
Watercraft & Boat Insurance Coverage
There are several coverage options to consider but before you get to those, you will need to decide on what valuation terms you want listed in your policy. If a total loss occurs, the payout for your boat will be determined based on either Total Replacement, Agreed Value or Actual Cash Value depending on the terms listed within your policy. These terms will have a very different payout so it is important to speak with an agent about your cost benefit analysis. Actual Cash Value indicates that the payout amount will be determined by the insurer based on whatever rubric they use to determine the market value of your car after depreciation. Agreed Value refers to a dollar amount written into the policy that was initially agreed upon by the both the insurer and the insured. Total Replacement is an insurance that replace your boat with the same model.
Common Types of Boat Insurance
BOAT LIABILITY insurance coverage, just like liability coverage for other assets, is protection for other folks and property that are damaged on or by your property in the event that you are deemed legally responsible. Liability is broken up into two basic subcategories: bodily injury and property damage. Bodily Injury Liability is typically covered in any standard boat insurance policy. This coverage provides protection if an accident caused by you results in litigation over medical bills, pain and suffering or death. Property Damage Liability helps to pay for the damaged property of others and resulting defense in an incident deemed to be your fault.
PERSONAL PROPERTY COVERAGE covers the property of the policy holder while it is on the boat and while it is being carted on and off the boat.
ACCIDENT CLEANUP helps pay for the removal of debris after an accident occurs. For example, if a fuel tank is ruptured during the course of a collision, gas leaked into the ocean will require a costly environmental cleanup and you may be assessed fines and penalties.
MEDICAL PAYMENTS COVERAGE will pay for the medical or funeral costs for you and your passengers. If you want medical payments to include incidents that occur outside of the boat like snorkeling or waterskiing, you may need to add Water Sports Coverage.
FISHING EQUIPMENT COVERAGE specifically protects expensive fishing gear and supplies while they are on the boat as well as when they are being moved on and off the boat.
What Watercraft Insurance is Right for You?
Determining the amount and type of coverage that you need requires a review of your assets and exposures. You may need one type or a combination to provide you with the comprehensive coverage tailored to you.