If you’ve been anywhere near a body of water lately, you have probably thought about buying a boat. Other boat owners look so carefree! But owning a boat is a major responsibility, and of course you will need insurance on your new toy.
Liability. Like homeowners insurance, a boat insurance policy will cover your liability in the event that someone is injured on your boat. Liability is an important issue to consider, because an accident can damage a lot more than your boat. Just as with homeowners insurance, a boat policy will cover you in the event that someone files a suit against you for injuries. The policy will also cover damage to other watercraft and even docks (you would be surprised at the number of accidents involving docks!).
Coverage for the boat. Of course, your boat insurance policy also provides coverage for the boat itself. Aside from accidents on the water, you want to ensure that your boat is protected against fire, flood damage, theft, andalism. Believe it or not, it’s not so uncommon for boats to be damaged or lost in events that have nothing to do with collisions on the water.
Options for coverage. You might be offered the option of covering your boat for “agreed value” versus “market value”. Agreed value is the sticker price of the boat, whereas market value refers to the actual value of the boat at the time of the accident. Due to depreciation, your boat might be worth much less than you paid for it, and selecting coverage for actual value can save you some money on your premiums. When you first purchase your boat, you might opt for agreed value coverage, but then switch to market value coverage as the boat ages.
Something else to consider… Oddly, your boat will not be covered by your boat insurance policy when it is attached to your car or truck. That means if you’re traveling and towing the boat, anything that happens to it will be covered by your auto insurance policy. Since that coverage will be subject to certain limits that you selected under your auto insurance agreement, you might want to give that policy another look when you decide to purchase a boat.
Be careful where you roam. Your boat insurance might not cover you everywhere. The policy’s “navigational warranty” describes that areas in which your boat will be covered. Generally speaking, all US waterways are covered, but you should be careful about roaming to international areas. Captain Jack Sparrow might be a fictional Disney character, but real pirates do exist!
For more information about boat insurance, give us a call. We can help you navigate your options and select a policy that is right for you.