Frequently Asked Questions
- If my boat gets damaged am I covered for
full value, or just partial value?
- Am I required by law to have insurance?
- How do I report a loss or accident?
- Does insurance cover losses if I rent
out my yacht for a fishing trip?
- I just bought a new boat. Does my
insurance cover it?
- We are taking a weekend cruise to some
offshore islands. Am I covered?
- I sold my boat. Does my insurance
transfer to the new owner?
- I plan to let my brother who is visiting
me sail my boat. Is he covered?
- Is parasailing covered under my policy?
- Does my boat insurance policy cover water
skiing?
If my boat gets damaged am I covered for full
value, or just partial value?
It depends. Check your boat insurance policy to see if
you are covered for Actual Cash Value, Agreed Value, or if you
have a Waiver of Depreciation.
The standard boat insurance policy covers Agreed Value, which
is the value of your boat or equipment at the time you took out
the policy as agreed to by yourself and the insurance company
(usually with reference to a marine survey). If you later
suffer boat or equipment damage the insurance company will pay
the agreed value less the deductible and less any applicable depreciation.
Some policies pay Actual Cash Value which is calculated like
the blue book value of your car taking into account age, condition,
and so forth.
However, if you purchased Waiver of Depreciation with your policy
(it would be noted on the insurance policy's declaration page),
the insurance company will not reduce your claim for depreciation
except for Sails. Although a Waiver of Depreciation costs extra,
a vessel owner comes out best with this coverage.
Am I required to have boat insurance
by law?
Not that we know of. But your banker might require the coverage
to protect the loan's collateral (i.e., your boat). Also, most
marinas require you to show proof of insurance in order to keep
your boat there.
How do I report a loss or accident
Refer to your policy for full details.
Give prompt notice to Police and the U.S. Coast Guard upon discovery.
Call your insurance company and follow up with a written explanation
describing the incident, any injuries or fatalities, plus names
and addresses of witnesses. Generally, this written notice
must be done within 30 to 60 days to preserve your rights under
the policy.
Under federal law you are required to file a boating accident
report with the Coast Guard if there is loss of life, injuries
that require medical treatment beyond first aid, damage exceeding
$500, or complete loss of the vessel. In some situations
this report must be submitted within 48 hours.
Does insurance coverage losses
if I rent my yacht for a fishing trip?
Probably not. Most policies only cover personal, non-commercial
use. Any use for which a charge is made, whether paid or
not, is not covered.
Insurance companies can provide insurance for charter and commercial
uses but that coverage requires a different policy. Call your
insurance company.
I just bought a new boat. Does my
insurance cover it?
No. Unlike buying a car, there is no automatic coverage for newly
acquired boats (new or used). You must purchase a new boat insurance
policy.
We are taking a weekend end cruise
to some off sure islands. Does my insurance cover it?
It depends where the islands are located. Generally, your
policy will cover you within the navigable waters of the continental
United States (up to 3 miles offshore) unless otherwise restricted
or extended by endorsement (refer to the declaration page of your
policy.)
I sold my boat. Does my insurance transfer to the
new owner?
No. The new owner has to get his or her own policy.
You should cancel your policy.
I plan to let my brother who is visiting
me sail my boat. Is he covered?
It depends. Look at the declaration page of your policy. Many
policies cover family members and others operating the vessel
with your permission free of charge.
However, some policies restrict coverage to Named Operators only.
If that is how your policy is set up then call the insurance company
and add your brother as an operator. (They may charge extra
for this additional coverage.)
Is parasailing covered under
my policy
Probably not. Check the boat insurance policy to be sure or call
your insurance company!
Does my boat insurance policy cover
water skiing?
Probably. Usually an injury covered by water skiing or to someone
you are towing is covered. Some companies require you to add this
as an option when you purchase your policy. The cost is inexpensive.
