Negotiating Your Boat Insurance Policy

While homeowners policies may be similar from carrier to carrier, your boat insurance policy will differ widely depending on the carrier you choose and the coverage you request.

In order to get the best coverage for you, you should take the following steps:

Step One – Go Through Steps With Multiple Carriers

Check the carriers by going through each of these steps with at least two different carriers so you are able to compare actual rates and features of each policy. Some companies won’t even offer types of coverage or features that you specifically require, so comparing companies thoroughly is important.

Step Two – Find Replacement Coverage (Agreed Value)

While it may save you a few dollars if you purchase an “Actual Cash Value” policy, an “Agreed Value, Complete Replacement” policy is the best policy you can get for a boat.

With an agreed value policy, you and the insurance underwriter negotiate a value for your vessel at the time that you insure your craft. There are no deductions made from this value, and no depreciation calculated.

Anytime you have a claim, the repairs are done or losses are paid based on that agreed value, not on a depreciated calculation of current value.

There are some items on a boat that are subject to a depreciated value, including things that weather easily like sails and trailers, canvas covers and some specific pieces of mechanical equipment.

Actual cash value policies will carry lower premiums, but will only repay the current market value of boats after recalculating figuring the boat’s current market value, depreciation and condition of the vessel. Then you must also pay the deductible.

Step Three – Choose “All Risk” or “Named Perils”

All-risk insurance is a comprehensive insurance that covers anything not specifically excluded by the policy.

Named perils take the opposite approach, and covers only those items specifically named in the policy.

Step Four – Ensure Covered for Peripherals

Dinghies, outboards, tenders, and electronic equipment are expensive components of a boat. Sometimes they are not covered under your standard policy.

Since these items are so easily lost, damaged, or stolen, it is important to purchase coverage for these items. You may have to buy a separate policy with an additional deductible for these items.

Step Five – Decide on Extras

You can purchase extra riders for your vessel, depending on your needs. If you are in far northern waters, it may make sense to purchase insurance against the lines and systems in the boat freezing or running through ice and becoming damaged.

You may also want to purchase marine-specific liability and personal injury insurance. The coverage in a typical marine liability policy is broader and has more protection than a standard homeowner’s policy provides. Check with the provider about what is specifically covered and to what extent.

You will want to include towing and emergency assistance, particularly if you navigate in waters far from shore.

Salvage coverage along with wreck removal and protection against salvage from thieves may be coverage you want to get. If you are ever forced to abandon ship, this kind of coverage comes in handy.


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