The weather is ideal for setting sail on the open seas. But before you leave on your voyage, it is important to make sure you have insurance for your boat and your liability. In recent years, boat insurance has become harder to find, especially in Southeast states, due to increased losses from severe hurricanes and storms. Hurricane Andrew in 1992 caused approximately $15.5 billion in insured losses, and damaged an estimated $500 million worth of pleasure boats, or the equivalent of one in every eight boats in South Florida.
According to the Insurance Information Institute (I.I.I.), the size and age of the boat as well as its horse power are the main factors determining coverage and premium. Other variables are the type and value of your craft and the water where it's used. A sail boat measuring 25 feet or longer would probably cost approximately 25 to 30 percent less to insure than a power boat.
When buying insurance, regardless of the boat or circumstances, it is important to know what questions to ask your insurance representative. The I.I.I. suggests asking the following:
1. Will personal possessions such as fishing or water-skiing equipment also be covered?
2. Will the boat be covered for actual cash value (depreciation) or agreed value?
3. Are there any lay-up periods, in dry dock, as for instance from December to April?
4. If I hire a crew, will it affect my liability coverage and include workers compensation coverage?
5. Are there discounts for safety equipment or safe boating courses?
You may be asked by the insurance representative about the use of the boat (cruising on a lake, boating across the Atlantic). Answer truthfully because any untruthful statement may cause future claims to be denied.
The I.I.I. advises owners of jet skis and waverunners to purchase a PWC policy to protect them in the event of an accident. The PWC policy covers bodily injury, property damage, guest passenger liability, medical payments and theft. Liability limits can start at $15,000 and be increased to $300,000. Typical policies may include deductibles of $250 for property damage, $500 for theft and $1,000 for medical payments. Additional coverage can also be purchased for trailers and other accessories. A $6,000 PWC insured for a premium of $400-500 could include $300,000 worth of liability coverage, guest passenger liability, physical damage for theft, accident or other calamity such as wind damage. Owners should talk to an agent or company representative for more information about the type of coverage that would best suit their needs.
Finding the right coverage may require shopping around and diligence on your part. However, taking the time now to review your insurance needs may mean smooth sailing for the rest of the season.
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