Insurance for Your Boat: What Does it Cover?
By Vance Stevens
Special to USInsurance.com
If you own a boat, you likely look forward to spending a thrilling day on the water. However, things do happen – often when least expected. Just like cars and homes, boats can be damaged, cause injury or damage to people and their property. Most states require a minimum amount of liability insurance on your boat. In addition, if you have a boat loan, your lender will likely require you to carry insurance until the boat is paid off in full. You may also find that many marinas and yacht clubs will not allow uninsured boats to dock. Regardless of requirements, it is always a good idea to protect your investment.
Coverage for Your Boat:
Similar to auto insurance, boat insurance policy coverage and limits vary from company to company. However, the main types of coverage for boat insurance are liability and property damage. Here is a rundown of what to expect out of your boat insurance policy.
• Property Damage Liability – Insurance coverage will pay costs from damage to other property from any accident deemed your fault you. This can be damage to another boat, dock, other structure or vessel.
• Bodily Injury Liability – Coverage will pay for expenses to an injury to others from an accident in which you are found to be at fault. Medical bills, pain and suffering, defense costs and lost wages may all be covered.
• Physical Damage – Covers damage to your own boat and its trailer. If you hit a dock or other structure and your boat is damaged, the cost of repair will be covered by your insurer.
Policies are paid out in several ways, including actual cash, agreed value and replacement cost.
• Actual Cash Value – The market value of your boat and parts.
• Agreed Value – A predetermined amount of coverage.
• Replacement Cost – The boat will be replaced with the same (or similar) type of boat. This pay out type is usually only available for boats less than two years old.
Optional Coverage:
Here are a few popular optional solutions for your boat:
• Uninsured Boaters – Covers you in the event of an accident with an uninsured boater.
• Medical Payments – Medical expenses for you or your passengers will be paid up to the policy limits.
• Personal Property – Pays for damage to personal property on the boat or when being transferred on or off the vessel.
• Roadside Assistance – Covers the boat during towing and most often the towing vehicle.
• Accident Aftermath – Covers debris removal from an accident.
Coverage Exclusions:
There are exclusions when it comes to boat coverage. Again, like auto insurance, it is important to check with your provider to determine what policy is best for you. Here are a few common exclusions.
• Physical damage exclusions usually include normal wear and tear, mold, defective machinery, machinery damage and more.
• Other watercraft such as a Jet Ski may not be covered on a boat policy. You will likely need a separate policy to cover such vessels.
Insurance Guide
Auto Insurance
Home Insurance
Life Insurance
Renters Insurance