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Navigating the Waves: 8 Things Customers Need to Know About Boat Insurance

Published Date: Mar 02, 2024

As the proud owner of a boat, whether it’s a sportfisher, motoryacht or sailboat, it’s crucial to understand the ins and outs of boat insurance. While hitting the open water with family and friends aboard, ensuring you have the right coverage in place provides peace of mind and protects you and your investment. Here are seven essential things every boat owner should know about boat insurance:

1. Types of Coverage. Boat insurance typically offers different kinds of coverage, including:

  • Hull and Equipment: Covers damage to your boat caused by collisions, theft and vandalism, or natural disasters.
  • Liability: Protects you in case you’re at fault for an accident that causes bodily injury or property damage to others.
  • Medical payments: Covers medical expenses for you and your passengers if injured in a boating accident.
  • Uninsured/underinsured boaters: Provides medical coverage if you’re involved in an accident with a boater who has insufficient or no insurance.
  • Oil Spill Liability: Provides coverage for pollution cleanup for sudden and accidental discharge of oil and fuel.

2. Agreed Value vs. Actual Cash Value:

When insuring your boat, you’ll encounter two primary types of coverage: agreed value and actual cash value. Agreed value policies reimburse you for the boat’s agreed-upon value in the event of a total loss, while actual cash value policies consider depreciation, meaning you may receive less than the boat’s current market value.

3. Navigation Limits:

Boat insurance policies have navigation limits, specifying where you can operate your boat while maintaining coverage. It’s essential to review these limits and ensure they align with your intended usage, whether it’s coastal cruising or offshore adventures.

4. Deductibles:

Like other insurance policies, boat insurance typically includes deductibles. This is the amount you’ll need to pay out of pocket before your coverage kicks in. Choosing a higher deductible can lower your premiums but may require more significant financial responsibility in the event of a claim.

5. Additional Coverage Options:

In addition to standard coverage, many insurance providers offer optional endorsements to tailor your policy to your specific needs. Examples include coverage for personal belongings on board, towing and assistance services, and charter coverage.

6. Review and Update Regularly:

As your boating lifestyle evolves, it’s essential to review and update your boat insurance policy regularly. Changes such as upgrades to your boat, modifications to your intended usage, or changes in your location can all affect your coverage needs.

7. Policy Warranties:

Be aware of policy warranties on your boat policy. Warranties are “promises” that the policyholder must comply with or a claim can be denied by the insurance company.

8. Talk to an expert.

At Novamar Insurance we have over 40 years of experience inuring boats in the U.S., Mexico and around the world. Our experts can identify risk factors and coverage gaps and provide insurance solutions to properly protect the assets of all our clients.

Navigating the waters of boat insurance doesn’t have to be daunting. By understanding these eight key aspects of boat insurance, you can ensure you have the right coverage in place to protect your vessel and enjoy peace of mind. Before setting sail, take the time to review your policy, consult with an insurance expert, and make any necessary adjustments to cruise confidently into the future.

Written by Craig Chamberlain of Novamar