Boat Insurance
In a previous post we talked boat transport and how that fell into the definition of “first world problems.” The type of problem that is not really a problem at all, rather, an issue that folks with means need to address, but don’t have to address (like finding fresh water for example). But don’t feel bad that you were lucky enough to have been born in the first world. Not much we can do to control for that, and if you have done well in life, then boat insurance is in your future.
A boat is a luxury item, certainly not like a car or a home or anything like that. People take care of basic needs first prior to buying a boat. But once the boat comes, insuring it like you would a home or car is a must. Within a typical boat insurance policy, one has physical damage and liability. The physical damage part covers damage to the boat, its machinery or accidental loss. This will cover the hull and engine as well as the sails and any other equipment on the boat as well as personal property. On the liability side, this will cover legal obligations to third parties. It will also help to pay for your legal defense if you are sued for some reason.
The best policies will cover “all risk.” Sounds rather comprehensive, right? It can be as these losses are associated with weather-related issues (waves, lightening, hail, rain and wind) and the damage that can occur in the form of fires on board or collisions with docks and interaction with floating objects that can also inflict damage on the boat. It is also recommended to make sure this coverage will include physical damage that can affect the boat on land as well as weather conditions that will affect boats not physically on the water.
When you compare insurance policies, the biggest difference can be found between coverage that is based on “Agreed Value” vs “Actual Cash Value” loss settlements. The former pay the amount published on the boat policy (if it is a total loss). Damage resulting from a partial loss in this case is paid based on a replacement cost (less the deductible). The latter will provide less coverage than the former, but it is also lighter on your wallet. This will provide coverage up to the current market value of the boat considering depreciation and additional factors. One is no better than the other, your personal situation is what matters.
Lastly, make sure you have an adequate limit of coverage for medical payments. This is coverage that includes ambulance costs, first aid treatment, hospital or similar expenses. This might seem secondary to ensuring the actual vessel, but odds are when a disaster strikes, you and potentially loved ones will be aboard, best to take care of all humans involved.
I own a 1994 Blue Water Eagle 180 and have a full insurance coverage on it. I must say that getting an insurance policy is a must for the boats as they are expensive items and you cannot bear repair cost all alone. Recently I got the cracked hull of my boat repaired through the boat insurance company. My boat insurance always work for me.