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Types of Boat Insurance

Power Boat Insurance

Fast drive!Whether you’re cruising the beautiful Intercoastal Waterway or enjoying the Lake Michigan water glisten in the sun, the peace of mind that good powerboat insurance brings needs to be there with you.

powerboat

Powerboat Exclusions

Exclusions can differ so much between insurance companies that you must compare, but here are some common ones:

  • Physical Damage Exclusions- defective machinery or damage to boat caused by machinery or damage from animals to your boat
  • Other Watercraft- If have a dinghy on your boat, it usually needs to be on a separate policy

Powerboat Coverages

Following are the 3 coverages you’ll see:

  • Bodily Injury Liability- Expenses paid for injuries that you’ve caused to others
  • Property Damage Liability- Pays damages from damages you’ve caused to property other than yours
  • Physical Damage- This covers damage to your own boat and its trailer

Sailboat Insurance

Unlike other boating insurance, sailboat insurance is mandatory in the United States. This means it’s illegal to sail anywhere in the United States without insurance.

sailboat
sailboat

Sailboat Coverage

Most sailboat policies include the following coverages:

  • Physical Damage- This coverage pays to repair or replace your boat, motor or boat trailer in the event of damage by windstorm, vandalism, theft, lightning or fire
  • Liability- This coverage will protect you if you cause injury to someone other than a family member or to property other than your own

Sailboat Coverage Exclusions

Items not normally covered include jet skis, kit boats, ski boats, high-performance boats, fishing and scuba gear, personal items, TV’s, cameras and video equipment, wear and tear, deterioration, dents, scratches, and manufacturing defects.

House Boat Insurance

Regarding insurance, houseboats are classified with cabin cruisers, party boats, and ski boats as pleasure boats. So, usually only marine insurer’s handle houseboat coverage.

houseboat
houseboat

Houseboat insurance premiums will be determined by the size and age of your boat, the type of craft, where it will be moored and the horsepower of the vessel. Your premium costs can vary from $10 to $30 per foot.

Standard watercraft liability coverage includes protection if damage occurs to other people or other property when you’re operating the houseboat.

Physical damage coverage will pay for covered damage to your boat within the policy limits.

Optional coverages can include medical payments, towing insurance, theft, vandalism, sinking, capsizing, and others. Expect an additional premium for these coverages.

Houseboat Insurance- Questions

Ask these questions when purchasing houseboat insurance:

  • When are marine surveys expected?
  • What are the territorial limits?
  • What dates are being used for the lay-up period (winter storage)?
  • What are the liability types and amount?
  • What are the deductibles?
  • Will live aboard coverage be needed?

Personal Watercraft Insurance

Before you take your jet ski or wave runner out for a spin, you’ll want to have it insured with a separate personal watercraft policy. This will protect you, others and your vessel.

jetski
jetski

Insurance coverage for the protection of you and others includes bodily injury, property damage, medical payments, uninsured and underinsured boaters, and guest passenger liability.

Physical damage to your watercraft includes theft, collision, vandalism, and damage caused by uninsured and underinsured boaters.

Optional coverages can include trailer coverage, fishing gear coverage and on water towing.

Check with your state to see what liability is required. Also, shop and compare policies carefully. Policy inclusions, exclusions, coverage limits, and deductibles can differ widely between insurance companies.

Charter Boat Insurance

Charter boat insurance is based on having passengers on board. And the coverage is designed to get the vessel back to profitability as soon as possible in the event something happens to the boat.

charterboat
charterboat

Charter Coverages

There are 4 kinds of charter coverages:

  • Full-Time Charter- This is written on a commercial policy.
  • Part-time Charter- This is an endorsement to a yacht policy. The number of days chartering is done is usually limited to 10 to 20 days annually.
  • Six-Pack Charters- This is the same as a full-time charter with only 6 passengers allowed.
  • Bareboat Charters- This is when a non-owner charters a vessel without a paid captain or owner on board.

Note: All vessels that carry more than 6 passengers must be certified by the Coast Guard. That’s because the Coast Guard allows only 6 guests for captained charters on non-certified vessels.

If you think you may in any type of charter situation with your boat, get the right charter coverage with a competent agent.

Bass Boat Insurance

As a fishing boat owner, you know the standard watercraft policy may not cover all of your specific needs. Bass boat insurance is for those who are serious about fishing.

bassboat
bassboat

Three Types of Bass Boat Policies

  • An agreed-upon value policy will pay the boat value listed in the policy.
  • An actual cash value policy will pay market value in the event of a total loss.
  • Liability only coverage only provides coverage if the bass boat causes damage to another person or other property.

Specific Fishing Boat Coverages

Following are some coverages that may be available for bass boat owners:

  • Tournament fee reimbursement.
  • Coverage for motorboats used by fishing guides.
  • Replacement cost coverage for boating equipment.
  • Towing assistance.
  • More coverage for personal belongings and the trailer may sometimes be offered.

Check carefully with your agent to make sure you get the coverage you need. It can vary widely from carrier to carrier.

Wooden Boat Insurance

You may have to shop around to find an insurer willing to insure your wooden boat. Many of them were made over 25 years ago and may fall under the category of an antique or classic boat.

wooden Boat
wooden Boat

To be covered for all risks, the boat must be safely operated in the water.

Wooden boat insurance policies are usually written for an agreed value on the hull. They also include liability, uninsured/underinsured boater, medical payments, and trailer coverage.

You can also purchase personal effects coverage, towing coverage, and oil pollution coverage.

Shop carefully and really consider the proper limits you need to adequately insure your wooden boat.

Fishing Boat Insurance

If you own a motorboat used primarily for fishing activity, it may be wise to obtain insurance that specifically addresses your fishing needs. Some of the coverages that may be available include:

  • Actual cash value or agreed upon value coverage for your boat, motor and boating equipment.
  • Fishing equipment coverage.
  • Tournament and fee reimbursement.
  • Cruising area extensions.
  • Medical payments.
  • Full salvage assistance.
  • Uninsured/underinsured boater protection.
  • Liability protection for damage caused by you to others or other’s property.
  • Personal effects coverage.
  • Trailer coverage.

Fishing boat policies are offered by specialized marine insurers. Shop around for the most comprehensive coverage with the lowest premiums.

Jet Boat Insurance

Most jet boat policies are all risk. This means everything is covered unless it’s specifically excluded. For your jet boat you can usually find the following insurance coverages:

  • Fire
  • Theft
  • Vandalism
  • Accidental damage to your boat in or out of the water
  • Liability if someone is injured or property is damaged by your actions
  • Actual cash value replacement at the time of loss
  • Replacement cost coverage may also be covered on new vessels

Here are some items that are not covered:

  • Any watercraft modified to improve performance
  • Any operation of the craft from dusk to dawn
  • Any operation by anyone without a driver’s license (exceptions may be made by endorsement)
  • Any operation during layup period (exceptions may be made by endorsement)

Check carefully with your agent to make sure you’re getting the coverage you.

Mega-Yacht Insurance

This insurance is written exclusively for the requirements of Mega-Yachts and their owners. In general, these are all risk policies with few exclusions.

Depending on the insurance company, these policies may include the following coverages:

  • Liability Coverage for the captain and crew
  • Electronics and Navigational Equipment
  • Personal Liability Coverage for a liveaboard captain and his/her family
  • Oil and Fuel Spill Pollution Coverage
  • Extended Navigation Limits
  • Fine Arts Coverage
  • Mechanical Breakdown
  • Charter/Exhibition/Demonstration
  • Cargo Insurance
  • Breach of Warranty
  • Coral Reef Insurance
  • Protection and Indemnity
  • Agreed Value of your Vessel
  • Towing to a Safe Harbor

Mega-Yacht Insurance is very specialized. It’s best to consult a proven expert in this field when purchasing insurance.

Pontoon Boat Insurance

Pontoon boats are basically rafts with a motor. They’re built to traverse slow-moving lakes and rivers.

If you’ve financed your pontoon boat, you’ll need insurance. It’s a low-cost way to make sure you and your lender are covered in the event of an accident.

Following is what’s covered with your pontoon boat insurance:

  • Liability coverage will cover damage done to other people’s property by your boat.
  • Bodily injury liability will cover you for injuries to another party that you caused.
  • Physical damage covers damage to your boat.
  • Comprehensive coverage covers damage to your boat caused by events and situations out of your control. This could include storms, hail, lightning, and theft of the actual boat.
  • Uninsured/Underinsured boat coverage, This will protect you if damage occurs to your boat by an uninsured or underinsured boater.

There are also optional coverages available for your pontoon boat policy. Ask your agent about all the specific coverages and learn about each one you choose.

Rental Boat Insurance

Rental boat insurance protects the boat and the renter for boat rental companies. Boats typically covered include:

  • Personal Watercraft
  • Pontoons
  • Runabouts
  • Fishing Boats
  • Houseboats
    Sailboats
  • Cabin Cruisers and more

Coverage includes protection for legal liability and protection for any damage to the rental watercraft.

Rental boat insurance coverage is provided at most locations like marinas, beaches, boat ramps, resort or and off water location.

Consider the coverage limits available for the watercraft being rented. Also, make sure you check if lay-up credit is available. Since most rental businesses are seasonal, you might be able to receive credit for the time your business is not operational.

Runabout Boat Insurance

Runabouts are day use motor boats used for recreational boating, fishing, and waterskiing. They’re generally open bow boats meaning there’s seating available on the bow of the boat.

Three Major Runabout Boat Coverages

  • Bodily Injury Liability- This is where you’re covered if your actions cause bodily injury to another.
  • Property Damage Liability- If you cause damage to another’s property be it a boat, a dock or whatever, this will cover the damages.
  • Physical Damage- This covers damage to your boat. The damage is paid according to agreed upon value of the boat, actual cash value or replacement cost (if available).

Replacement cost is the most expensive physical damage coverage.

Other Coverages

You can also purchase optional coverages which could include:

  • Towing
  • Personal effects
  • Medical payments
  • Uninsured/Underinsured motorist

Since offerings vary so much between carriers, shop around for runabout boat coverage.

Cheap Boat Insurance – Your Questions, Answered

Just like auto insurance that protects your car, boat insurance gives financial security your boat, ship, and cargos in the event of an unforeseen accident. Similar to insurance types, boat insurance comes with different perks and coverage.

Before knowing how to obtain cheap boat insurance quotes, let’s have a quick review of what boat insurance is all about.

boat
boat

What Does Boat Insurance Cover?

Boat insurance – others call it marine insurance – is a type of financial protective policy that covers boats, cargo, and other casualties. Cheap boat insurance is provided by underwriters and insurance companies.

It is believed that boat insurance is the oldest form of financial protection against loss. The concept stemmed from ancient Greeks and Romans in protecting themselves against the risks involved in the maritime enterprise.

How Does Boat Insurance Work?

Technically speaking, cheap boat insurance works by giving out initially a certain amount of money called premiums. In this way, the individual invests his or her security. Boat insurance works the same with all underwriters; it only matters on how they calculate your premiums.

It has been hypothesized that companies which offer cheap boat insurance policies are the company’s marketing ploy in drawing customers. It must be mentioned that underwriters of cheap boat insurance policies are not marine specialists themselves.

However, these people are expected to have better grasps on boat insurance. Boat insurance policies are not solely purchased in physical locations but on the web as well.

Whether it is an expensive or cheap boat insurance policy, underwriters almost give the same type of coverage.

What are the Components of Cheap Boat Insurance?

There is two primary coverage of boat insurance – the hull and machinery coverage. The hull and machine boat insurance provide replacement of the lost vessel or reparation of the damaged boat parts. Other than these, collision, accidental sinking, theft, and emergencies like fire are likewise protected by a boat insurance policy.

One scope of the boat insurance policy is protection and indemnity coverage. The main purpose of Protection and Indemnity coverage is the security of one’s property and personal assets in the event of damage claims. This type of financial protection works when someone sues you for damages and injuries (when your boat is at fault).

Depending on the amount of coverage, this perk of cheap boat insurance may pay for the damages caused by your boat. For example, when the fire started from your boat and spread to adjacent boats and buildings leading to extensive impairment and loss of value.

What Does Boat Insurance Doesn’t Cover?

Cheap boat insurance has bound limits. The same goes for the policy coverage that might vary from one company to the next. Loss and damages due to war are unlikely covered by boat insurance. It does not also provide indemnity to very slight damages of the vessel (such as scratches) and loss of boat due to negligence.

When your sailboat or yacht disfigure due to racing, even cheap boat insurance will not cover for it. Impairment brought by racing and athletic events is not covered by boat insurance as well.

It must be mentioned that boat insurance policy is deemed broad just like other insurance types. One insurance policy may cover the damages but might not on others. The best way to be precise on the coverage is to determine the extent of the policy straight from the lender.

On the flip side, cheap boat insurance not only covers the vessel but also the boat at fault and the passengers. However, the perk on towing depends on the company which offers the policy. Some companies accommodate it for free while nearly all of them provide the service with additional expense.

If My Boat is Loss, Will the Insurance Company Replace the Vehicle?

This actually depends on how the boat was lost. As mentioned in the preceding paragraph, boat loss due to negligence is not covered by the policy. But when the ground is under the scope of the boat insurance, the company will pay the actual cash value of the vessel or pay for the agreed cost.

How to Obtain Cheap Boat Insurance?

The cost of a boat insurance policy is influenced by several factors. Having said this, it is presumed that every boat owner has different boat insurance value as he is assessed and rated accordingly based on predetermined factors.

When applying for cheap boat insurance, the lender will ask a few questions to you such as the specifications of the boat, driving record, accident history, and safety equipment of the boat. From these questions, the lender will evaluate for your contribution amount on a monthly basis (or the premium).

The best way of filing a claim is to contact the lender of the insurance albeit one can file a claim through an online process. Part of the US Coast Guard law is the submission of an accident report before the insurance company can process financial assistance. The due of the report would depend on the local laws and nature of the accident.

 How to Get Cheap Boat Insurance Quotes?

To keep your premiums low, take note of the following:

  • Boats and ships that are newly purchased – normally, less than 10 years – are cheapest to insure.
  • A motorized boat with an inboard motor is more costly than a vessel with an outboard motor.
  • Diesel engines are less insured than gas engines.
  • Acquire the basic boating safety equipment to get a premium discount. Basic safety equipment includes life jackets and fire extinguishers.
  • Keep a clean boating record. Individuals with a history of accidents and violations are likely to have higher premiums.
  • A safe place to dock your boat may help reduce your monthly premiums.
  • Paying high deductibles will reduce premium charges.

Keep in mind: Don’t set for a cheapest boat insurance policy. When obtaining cheap boat insurance, think of your needs and not the value of the policy.

Warren Paine

Warren is the senior mortgage loan officer who has worked in mortgages and loan industry since 1995. He study in Harvard and major in Finance with a Bsc. Honor Degree. He possesses a Paralegal Certificate as well.

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