Boat Insurance: Types of Policies

There are two different types of policies for covering your boat.

Actual Cash Value

Outboard motor boat in the water.This type of policy pays for the cost to replace the boat minus depreciation at the time of the loss.  Pricing guides for used boats and other resources are used to determine the boat’s approximate market value.

Agreed Amount Value 

Pays you the amount you and your agent agreed upon when the policy was written. In case of a loss, that is the amount that will be paid to you. Agreed amount policies will also replace old items for new ones in case of a partial loss, without any reduction for depreciation.

Boat insurance typically covers repairs to your boat if it is accidentally damaged or destroyed by a collision, fire, theft, vandalism, windstorm or lightning. This coverage is for the boat, its machinery, fittings, outboard motors, auxiliary equipment, permanent attached equipment and personal property. You can get coverage add-ons that cover things like an expensive prop or accessories, towing from across the lake to safety. Salvage coverage will pay to remove your damaged boat.

Boat insurance also provides coverage for Personal Liability up to $500,000 for bodily injury or damage to property or others. Uninsured boater provides coverage for bodily injury caused by an uninsured motorist. Medical payments for medical care following an accident, regardless of who’s at fault.

Personal Property Coverage protects personal property on the boat including items such as your clothing, stereo system, cameras, fishing equipment and other personal items.

Listed below are a just a few discounts that you may be eligible for, check with your insurance agent on what is offered through your specific policy:

  • Diesel powered boats
  • Coast Guard approved extinguishers on board
  • Ship to shore radios
  • Claims free
  • Multiple policy discounts for same insurer (i.e.: auto, home or umbrella policy)
  • Completion of a Safe boating course

Personal watercraft such as Jet skis and Wave runners require separate boat insurance.

Enjoy the open waters with confidence – contact us for a free, no obligation quote

By: Insurance Advisors, Inc.
Sources: Insurance Information Institute

Boat Insurance: What You Should Know

What You Need To Know About Bout Insurance.Boat Insurance

If you have a boat of any kind, it pays to learn about boat insurance. Also known as watercraft insurance, boat insurance will protect you, your boat and others in the case of a loss. While not mandatory, it is highly recommended for all boat and personal watercraft owners.

The Basics

Boat insurance is very similar to car insurance. Many of the same options and choices you have for your auto insurance policy will be presented to you for your boat insurance. The most important of these is liability coverage.  Liability insurance is extremely important to carry,  because if another person is injured or killed due to an at-fault accident with your boat, or another’s personal property is damaged, you can suffer huge financial losses.

Collision and comprehensive coverage will protect your investment in your boat. They will cover the cost to repair or replace your boat, motor, trailer and any equipment that is permanently attached to your boat in case of loss. Collision coverage is in case your boat collides with another boat or property and you are at fault. Comprehensive coverage is for other types of loss, such as storm damage, theft, fire or vandalism. Claims of these types are subject to a deductible that you choose when you take out your policy.

The Not-So-Basics

The amount that you can receive from a collision or comprehensive claim is based on the type of policy you choose. An actual cash value policy is based on the replacement cost of your boat minus any depreciation up to the date of loss. Claims are paid out for this amount minus the deductible. Agreed amount value is the other type of policy that does not factor in depreciation. Premiums are set based on an amount agreed to by the insurer and the insured, as to how much the boat is worth.

Boat insurance varies in price not only from company to company, but also from insured to insured. As with other types of insurance, the premium you pay depends on the rate set by the insurer. The rate is determined by underwriters who look at a variety of factors to determine exactly how much risk they are assuming by offering you boat insurance.

The boat itself is one of the major variables considered by an insurer when setting rates. The insurer will need to know the length of the boat, the horsepower of the motor and the year, make and model of both boat and motor.

Information about the boat owner will also make a difference in your boat insurance premium. You will need to give information about your driving record. If it is less than perfect, expect to pay more for boat insurance. Your claims history will also impact the rate.  If you have made multiple claims in recent years on any type of insurance, your rate will be higher. If you have a poor credit history, you will be deemed higher risk and charged accordingly, as research has shown that those with poor credit scores are more likely to make insurance claims.