Do I Need Boat Insurance?

Your homeowner’s insurance policy will cover your boat in some instances; however, this coverage does not go far. Typically, homeowner’s insurance will cap boat or water recreational vehicles at $1,000 or 10% of your home’s insured value. In most cases liability coverage for your boat which pays for damages that your boat causes other boats or structures, usually isn’t covered under home insurance.

Types of Boat Insurance Coverage

There are two different types of boat insurance coverages: agreed value policy and actual cash value policy. The type of coverage you purchase is based upon what you and your insurance company agree upon. 

Agreed Value Policy 

An agreed value policy is a policy that you and the insurance agency have agreed on a pre-approved amount that you will obtain in the event that something happens to your boat.

This is the preferred policy in the boating community because the insured knows the exact amount they will receive if they have an approved claim. However, not all accidents and repairs are covered so it’s important to get in touch with your insurance agent before filing a claim. 

Actual Cash Value Policy 

Unlike an agreed value policy, an actual cash value policy only pays up to the value of the boat at the time of the accident or loss. The insurance company factors in depreciation, damages, and wear and tear to the current value of the boat. This could significantly decrease the amount you are paid upon an approved claim.

What does boat insurance cover?

• Liability
• Full Coverage
• Medical Payments
• Under or Uninsured Boaters
• Trailer Coverage
• Fuel spillage 
• Fishing equipment coverage
• And more

There are also common coverage add-ons (in addition to the basic list above) which include:

• Specialized Coverage: Coverage for specific items on your boat such as an expensive prop or navigation equipment.
• Salvage: Coverage that pays to remove your boat due to damage.
• Consequential Damage: Covers a loss that was a result of wear and tear rather than an accident such as rot, mold, or corrosion.
• Towing: Coverage for towing your boat across a body of water. This service can cost approximately $400 per hour if you don’t have insurance.
• Cruising Extension: You can get temporary, additional coverage if you plan on leaving the USA.

What does boat insurance cost?

Some elements that will affect the cost of your boat insurance policy include:

• Value of the boat
• Horsepower of the boat
• Driving record
• Age of the drivers
• Boat usage
• Extra coverages

Would you like to discuss your options for boat insurance? Contact Us