Boat Owners Insurance: Perhaps Not So Optional


Why You May Want to Talk to a Boat Insurance Broker

man holding sailboat in hand - boat insurance image

Fishing or just boating, for that matter, can bring great and fun adventure! However, it is not always incident-free – nothing is. So, having reaffirmed Murphy’s law, I ask: does your boat have insurance? If it does, then you know how important it is, and the information I am about to share with you might not be all new to you. However, if you don’t or are asking yourself if you have to have boat insurance, you may want to want to read on – at least, if protecting your investment or yourself against potentially expensive damage, loss or liability is important to you.

If your boat is not insured, then now might be the time to start thinking about it. You will see why skipping on coverage could be the most costly mistake you can make with boat ownership. You will also learn the basics about how does boat insurance work and how to get the right coverage for your boat, watercraft or yacht in this piece. Hopefully, the information presented here will help you to better make the right decisions about insurance coverage for your fishing boat or other recreational watercraft. I will also delve into add-on coverage such as fishing tackle insurance to protect your precious gear and equipment on your next fishing trip. That old saying, ‘better safe than sorry’, is really what a boat insurance policy is about, in a nutshell.


Do You Need Insurance on Your Boat If It’s Not Required?

There is generally no legal, or otherwise, requirement to carry boat owners insurance. Sure, a handful of states require liability coverage, most marinas will require boat slip insurance to keep your boat, and lenders will typically make you carry insurance if you are financing the boat. But that’s it – the majority of the time you are not compelled to buy boaters insurance.

For the sake of insurance classification, a boat is a vessel that is 26 ft. or less. If it is 27 ft. or longer it is considered a yacht, regardless of what it looks like. In the broader sense and for the sake of this post, I will use the word boat to encompass all size vessels. However, regardless of the size, you may want to purchase boat insurance for peace of mind. The exception may be a situation such as where you have a house with a dock that has a clause to cover your boat.  But keep in mind that even in such cases, the coverage is limited to small boats with no engine, or if any engine, a small one; and it will most likely have many exclusions that make it inadequate.

yacht insurance brokers - yacht insurance online quote

For bigger boats or  for more comprehensive coverage, you will have to get an insurance policy, in any case, if you want adequate protection. An insurance policy of any kind is something none of us ever want to use, but having it when you need it can make the difference a bad fishing trip and a life-changing event, in some cases. You’ll be glad you had it! If you’re still asking yourself, ‘Do I need boat insurance?’ let me give you a few possible situations in which you might want to have it:

  • If you hit another boat, to cover the other’s boat repairs
  • If your boat hits another boat and you are at fault (covers damages to your boat)
  • If your boat is hit by another boater who is uninsured/underinsured (covers damage to your boat/bodily injury to you or your passengers)
  • If you hit private property, to cover damages
  • If you lose your personal fishing gear in a boating incident
  • If you need assistance to tow your boat
  • If your boat floods
  • If your boat hits something (a rock, dock, etc.) and gets damaged
  • If your boat hurts other people, whether on your boat or the other boat (bodily injury)
  • If your boat is damaged during a hurricane
  • If your boat is on fire
  • If your boat is vandalized or stolen
  • If your engine breaks (most insurance companies offer this option with limitations)

Remember, having insurance does not always guarantee you have the right coverage. Especially with boat coverages, there are no standards, and each boat owner will have to choose the coverage that best fits his or her situation. Tell your broker exactly the type of boating you plan on doing and the types of coverage you are looking for. And, even more importantly, always read the fine print on your policy!


Coverage for Your Boat While on Land

Remember, boat owners insurance does not give you any type of coverage while your boat is on land. However, there is a risk from when you keep it at home or when you are in transit. When you get your boat, you must check the insurance policies of your home and car see what kind of coverage they may offer. It is important that you know what they cover in case something happens to your boat while it is out of the water.

Generally, your auto insurance will cover incidents while you are towing the boat, and your homeowner’s policy would pay for damages while your boat is in your driveway, garage or yard, for example. Keep in mind, however, that any coverage will usually be very limited and only cover small boats with property damage limits as little as $1000 and offer no liability insurance.

Of course, If there is not enough coverage, or if you want to feel more comfortable handling potential risks, there is another type of policy called the umbrella policy. You can use it to go beyond the limits of your original insurances to further protect you in case there is an accident or loss.


Restrictions on Boat Insurance

There are some limitations on most  boat liability  insurance to make them more affordable. Since fishing is a seasonal activity, they cover accidents only during the season. That means that if you happen to go out on your boat on a date outside the ones stated on your policy, you will not be protected.

deep sea fishing boat insurance

Another restriction is navigational limits, or the area within which your boat will be covered by your policy. Depending on the type of boat you have, it is classified to fall into a category. For example, while every company has its own guidelines, most will restrict the range that a boat can cruise and still be covered, particularly if it is a small boat, and will require that a boat owner purchase an extension” in order to cruise outside the original covered area. ” There are, of course conditions and limitations even with the extension. An insurer that specializes in marine coverage may offer more liberal cruise distance extensions.

Another restriction is about in which countries are you covered, even with so called international boat insurance. Check where you are covered before you get your insurance policy to make sure that is where you want to sail – just because you are covered in the United States it doesn’t mean you’ll be covered on that fishing trip you are planning to the Caribbean on your boat with your buddies. Check with your agent. Additionally, some countries such as Mexico also require that you have liability insurance issued by a local company if you want to enter their waters.


Your Boat’s Value

You must be aware of the two important terms on boat insurance:

  • Agreed Value
  • Market Value

The agreed value means that in the case of total loss of your ship, you’ll get paid the amount stated in the policy, regardless of any other factor. For a market value policies, the price for your boat in case of total loss is determined according to the depreciated cost of your boat.

Most times, insurance companies offer discounts when you sign for a market value since it will always be lower. However, that will not be suitable for all situations. If your boat is new, it is better to sign for an agreed value, since it will protect your investment.


How to Qualify for the Best Boat Insurance Rates

To be eligible for lower cost insurance, do the following:

  • Add any safety options to your fishing boat
  • Layup discount for not using your boat year-round
  • Take qualified boating classes
  • No driving incidents (in land or water)
  • Discount for freshwater boating instead of saltwater

These points will lower the risks, and therefore the cost of your insurance policy. Also, make sure your boat is correctly classified to get the best possible coverage.


Additional Policy Options for Serious Fishermen and Pros

There are other coverage options for fishermen. If you are a pro, then you might be interested in some of the following:

  • Get coverage for your fishing gear (rods, reels, depth/fish finders, trolling motors, etc.) up to a certain amount
  • Tow service/on-water emergency coverage
  • Reimbursement of tournament fees in case you cannot participate due to covered conditions
  • Liability coverage for pro fishermen for activities related to exhibitions, paid shows, seminar, workshops, fishing guide events


2 Not-So-Optional Coverages Anglers Should Consider

From the previous list of optional coverage, even recreational fishermen should consider tow and fishing tackle insurance. These options address some of the most common issues involved with sport fishing.

insuring your fishing tackle and gear

Tow expenses on the water are unexpected and high. The average rate per hour of towing is 500 dollars. If you are 20 miles away, it can cost you thousands of dollars. As you can see, tow insurance sounds like a good protection. An Alternative to this is having a membership with a marine tow service, such as BoatUS or Sea Tow, that may provide more services and coverage options.

As for the fishing gear, since most people buy their equipment little by little, they are not always aware of the total investment they’ve made. There’s also the expensive single pieces of tackle many of us have. If you were to sit down and add up the value of all the fishing-related equipment you have accumulated over the years, you will quickly realize the necessity for insuring them. A big loss through accident, theft or whatever would certainly sour any fishing trip. So, it is better to be protected.


Compare the Market for Boat Insurance, Get the Right Policy

Getting a boat policy is neither difficult nor as expensive as it once used to be. In fact, most of your traditional home and auto insurance companies such as Progressive, AllState, State Farm and Geico (bought out BoatUS) all offer various insurance products and can give you a quote. There are also dedicated marine and boat insurance companies out there that are worth researching.

My recommendation is that you speak with a boat insurance agency or yacht insurance broker, as they specialize in the field and your coverage is more likely to be set up right from the beginning. You’ll be happy you did should you ever have a to make a claim, and the peace of mind you’ll have will allow you to focus on the things you love to do most… like fishing!



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