It is getting warm out and summer looms just around the corner. This is the time of year that all of us “old salts” get those tarpaulins off the boat that has been cooped up all winter. It is paint scraping time, clean up time, sail prep, and engine prepping time. Yes, it is time to get our boats ready to launch into summertime filled with joy and great memories. Is your boat Insurance Ship Shape?
It is also a great time to peel the shrink wrap off of your boat’s insurance policy.
Watercraft insurance varies greatly and is customized to each boat owner. There are a variety of coverage options and credits available to tailor your policy.
Physical damage coverage
First and foremost is physical damage coverage for the hull itself. Many times this coverage also includes the engine(s). It also includes sails, machinery, furniture and most other equipment that is normally used on board. This coverage can be written on an actual cash value basis, which is a depreciated amount or on an agreed value basis, which is an amount agreed upon by you and the insurance company up front. Do you have adequate coverage? The best way to determine this is to get the advice of a qualified marine surveyor. Most insurance companies require a survey on boats over 10 years old and an updated survey every five years after the first one. A marine surveyor will assess not only the value of your favorite toy, but he will check the boat for structural problems, engine problems, and electrical problems. A leaky pipe or a faulty wire on a boat could lead to disaster. The policy deductible is either a fixed dollar amount or a percentage of the total hull coverage. You can increase this deductible to save yourself some money.
Personal Effects coverage
Many boats these days come well equipped with the latest electronics, ice makers, microwave ovens, TVs and every other comfort of home. Be sure your policy covers these valuables. Personal Effects coverage covers all of your personal belongings from fishing gear to beach towels. Most companies throw in $500. Is this enough?
Protection & Indemnity
The watercraft liability portion is called (P&I) or Protection & Indemnity. This section covers you for damage to another boat or dock, and for bodily injury or death to another person as a result of your negligent operation or ownership of the boat. This coverage usually includes the cost of pollution cleanup in case of a fuel spill. You should carry limits at least equal to that on your auto or home. Many personal umbrella carriers require that you carry at least a $300,000 limit.
Uninsured Boaters coverage
In the event that you, your guests or family are injured while on board, the policy provides payment for incidental medical expenses. The coverage also applies if someone is injured boarding or getting off your boat. Uninsured Boaters coverage is relatively inexpensive and covers you and your guests if they are injured by another boater who does not carry boat liability insurance.
Do you water-ski or race your sailboat? You need to have a Water Sports Liability endorsement. Other coverages that you may want to add include coverage for your dinghy/tender and its outboard motor, a trailer, or Emergency Towing service.
Premiums are calculated on hull construction, length, the age of the boat, horsepower or speed, fuel type, waters navigated, lay-up period, previous experience, claims experience, boating education such as Coast Guard or Power Squadron courses, and survey results. If you have not taken the Coast Guard course, you can take it right here in your backyard. The U.S. Coast Guard Auxiliary offers boating courses each spring and fall. This course can not only save you up to 10% off of your premium, but it could also save a life.
Is your boat Insurance Ship Shape?
The lay-up period is the months that your boat is laid up (stored) for the winter. The customary lay-up is November 1st to April 1st. You can shorten or lengthen this period. If you are a late starter or if you haul out early you can change this period and save a considerable amount of premium.
Have a safe boating season. Is your boat Insurance Ship Shape?
See you out there!
Photo credit: http://markmedeirosphotography.com/