Summer will be here soon, and many people are looking forward to spending some time out on the water. If you own a boat or are thinking about buying one, it is important to have boat insurance. Your existing auto and homeowners insurance policies will not cover your boat in all circumstances.
Many homeowners policies cover only small boats with no engine or a very small one. A homeowners insurance policy will not provide enough coverage for an expensive boat. You will need a separate policy.
Boat insurance is similar to homeowners insurance in that it covers you if you are liable for injury to someone that occurs on your boat. It is like an auto policy in that it covers bodily injury that your boat causes to others, property damage if you hit a dock or another boat, and damage to your boat if you hit something or run around. You can also purchase comprehensive coverage that will cover you in the event of theft, vandalism, or fire; personal property coverage for fishing gear and other items on the boat; uninsured boater insurance; and roadside assistance if your boat needs to be towed.
If your boat is completely destroyed, the amount of money you are reimbursed by your insurance policy will depend on the type of coverage you choose. If you insure your boat for the “agreed value,” you will be reimbursed the amount you paid for it. If you choose “market value,” you will be reimbursed for the value of the boat at the time of the loss, taking depreciation into account. People who own newer boats often choose agreed value, while those with older boats tend to choose market value.
Your boat policy might not cover you everywhere. Many policies have navigational warranties that cover boats only in certain geographical areas and specifically exclude areas that are deemed dangerous for political or security reasons. Your policy might help you pay to move your boat to a safer location if a named storm is approaching that could put it at risk.
There are several ways to get a good rate on boat insurance. Buy a policy specifically designed for the type of boat you own (yacht, dinghy, sailboat, etc.). Upgrade your boat with optional safety features. You can get a discount if you take a safe boating class. Some policies allow you to “lay up,” or suspend, your coverage for a period of time when you will not be using your boat in order to save money. You can also save by bundling your boat policy with your auto and homeowners insurance.