Summer’s here and it’s time to enjoy your boat. However, you also need to consider whether you and your boat are well-protected.
Here are 7 things you need to know about boat insurance so you can spend worry-free time on the water.
Don’t Rely on Your Homeowner’s Policy
Many boat owners mistakenly believe their Rhode Island homeowner’s insurance policy provides ample protection for their boat. Realistically, most policies only provide minimal coverage for small boats.
A typical homeowners policy provides a total of $1500 of coverage for you boat, trailer, or outboard motor if damaged by a covered cause of loss. However, there is no coverage for theft of your boat, trailer, or outboard motor if they are away from your home address. Drive away with your boat and “poof,” no theft coverage. Also, there is no coverage for windstorm or hail damage to your watercraft unless it is inside a fully enclosed building. There are lots of limitations to be aware of!
Not only is damage/theft to your boat limited on a homeowners policy but so is watercraft liability. Liability coverage protects you if you were to cause bodily injury or property damage to someone else and found negligent or liable for their injuries or damages. A typical homeowners policy will extend your homeowner personal liability limit to include watercraft liability ONLY if one of the following is true at the time of loss:
- The watercraft is stored
- The watercraft is a sailing vessel less than 26 feet in length
- The watercraft is powered by an outboard engine or motor with 25 total horsepower or less
- The watercraft is powered by an inboard or inboard-oudrive engine, including those that power a water jet pump, of 50 horsepower or less AND the watercraft is NOT owned by an insured
As you can see, even if your homeowner’s policy provides some coverage, it is very limited so its wise to discuss with your agent what type of boat you have, if you plan on renting a boat, or even borrowing a friends boat.
Others May Require It
Even if your state does not demand boat insurance, your lender, marina, or storage facility probably does. If you own an expensive boat you’ll want it to protect your investment.
Opportunities to Reduce Premiums
Insurers assess boating risk using factors similar to other insurance types. However, you also have similar opportunities available to you to reduce your premiums.
These include taking a boating safety course, maintaining a claims-free status and good credit, bundling policies and choosing a higher deductible.
Many boaters can’t use their vessel throughout the year so it doesn’t make sense to pay full premiums while their boat is in storage.
Luckily, many insurance companies offer “lay up” discounts for the months your boat is off the water and stored safely.
Boaters living in a cold regions of the country, like here in Rhode Island, will want to include coverage to protect their craft against ice and freezing. Both these risks can cause significant damage and this damage often isn’t covered under a standard policy.
Don’t Discount Additional Coverages
Getting stranded on the water is never fun, but especially if you have to pay out-of-pocket for water tow coverage. Equally valuable is fuel spill liability coverage to compensate you if you’re involved in an incident that leads to disaster.
You may also want additional coverage for while your boat’s on land. Generally, when your boat’s out of the water you need more protection. Ask your agent or broker what’s best to protect it at different times.
Policies Vary Greatly
There’s no such thing as a one-size-fits-all boat insurance policy. Consequently, buying just any online policy doesn’t make sense for any boat owner. You may not realize the difference between a cash value and replacement cost policy, until you file a claim.
As well, most boat insurance policies only provide protection in the area you typically boat. If you take your boat with you on vacation out of your region, you may not have coverage. This is especially true if you leave the country.
Insurance agents and brokers understand policy coverages and limits and the exemptions that could negatively affect you. Rely on their expertise so you get the coverage you need and don’t pay for unnecessary bells and whistles. Insurers offer countless products to suit your needs and budget.