Boat Insurance Basics

First let's tackle the question of whether you need a separate insurance policy for your boat at all.  If your boat is small and has no power, the chances are that your homeowner insurance policy will afford some liability protection.  To be sure, you should contact your agent.

A typical homeowner policy includes liability protection for small boats such as canoes, rowboats, and kayaks.  A Boatowner or Watercraft Policy may be for you if you need more protection for your basic boating property or need to cover equipment like fishing gear, boat covers, fenders, or electronic equipment.  You may need a Watercraft Policy to obtain liability coverage if your boat is more than 26' or has more than a 25 HP engine.

Most Homeowners Policies exclude ANY liability coverage for Jet Skis and Wave Runners.  You need to look into a separate policy if you own these items.  This type of coverage is often called a Personal Watercraft Policy(PWC). 

A Watercraft Policy usually combines a number of different coverages including:

• Liability and Medical Payments Coverage.
• Physical damage coverage to hull, machinery, fittings, furnishings and permanently attached equipment.
• Towing and assistance.
• Pollution
• Uninsured boater liability coverage.

The Watercraft Policy has a deductible and it may be applied differently depending on the type of property involved in the loss.  Reimbursement for physical loss to the property may be made on an Agreed Amount basis, an Actual Cash Value basis(ACV is cost new less depreciation), or a Replacement Cost basis depending on how the policy is written.

It may be important to you to make sure you have coverage during storage, while the boat is in transit, or if you hire a crew. There is much variation in boat policies that needs to be noted including potential discounts for:

• Lay up periods - periods when the boat will not be used for any purpose whatsoever.
• Newer Boats
• Burglar Alarms
• Coast Guard Approved Fire Extinguishers or Halon systems
• Safety Courses (see these websites: http://www.cgaux.org, http://www.usps.org)
• Ship-to-Shore Radio
• Diesel Power
• Multiple Policies with the Same Insurance Company (e.g., Auto, Home)

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