Coverage on the Water
Boating is an enjoyable hobby for many people. You get to relax on the water with the wind in your hair. Feel the power of the boat as you cut through the waves. And don’t forget about all the activities you can do on the water, such as fishing, skiing, and tubing.
According to the National Marine Manufacturers Association, one in five Canadian households own at least one recreational boat. Owning a boat is a big investment. Just like a vehicle, a boat will require maintenance moving forward. In addition, you also must think about protecting your vessel with Boat Insurance.
The coverages available are numerous, and understanding what is available will help you select a policy right for you. Let’s take a closer look at what benefits are associated with insuring your watercraft.
Boating insurance can provide coverage for specified causes of loss. In general, the following insurance coverages are available for most boat owners:
- Collision damage
- Medical payments
- Bodily injury liability
- Property damage liability
- Additional enhancements
Not all coverages must be purchased to obtain coverage, although prudent insurance agents would recommend at least some coverage under each. Regardless of the claim type, the amount of payment received resulting from a claim will be subject to deductibles and limits of insurance.
Collision and Comprehensive
The two most often misunderstood coverages within a boat policy is Collision and Comprehensive. Most insurance policies usually require at least a minimal amount of Collision coverage to write you a policy.
Collision coverage responds in the event you collide with another boat or object. It only pays for damage done to your boat, not the other boat or object you run into. This is an important fact that unfortunately is sometimes learned the hard way. It is also important to note that colliding with an animal such as a whale or dolphin is not covered under Collision.
Comprehensive coverage can be thought of as covering damage caused to your boat which was outside your control. This is a very simplistic description of the cover, but it is easy to understand. If your boat is damaged by a hurricane, stolen, or has a run in with a whale, Comprehensive coverage would step in to help make repairs or replace your vessel.
Actual Cash Value
When you purchase a boat, the value of a boat will start to decrease immediately. This is similar to buying an automobile. Over time, the value your boat will continue to decrease and under most Boat Insurance policies, so will be the claim payment if your boat is damaged or stolen.
Policies use ‘actual cash value’ language in their forms. This limits the amount of paid by insurance companies to the value of your recreational boat just before the covered event occurred. The amount will be like the trade in value found in valuation books. This means you will be out of pocket for the difference between the actual cash value and cost to replace the boat with a vessel of similar make, model, age, and condition.
Replacement cost insurance policies are available on many boat policies. However, most insurance companies will only offer coverage on brand new boats or those less than two or three years old.
Property Damage and Bodily Injury Liability
Above we’ve reviewed how Collision and Comprehensive coverage will protect your boat resulting from a covered event. The liability coverages available on Boat Insurance policies provide you coverage to pay for someone else injury or damage.
Property Damage Liability will pay to repair or replace damage caused by a boating accident that was your fault. This includes damage to another vessel, a pier you collide with, or other obstacle your boat strikes.
Bodily Injury Liability provides coverage if you are responsible for injuries to others. This includes people on another boat who suffered injuries resulting from an at-fault accident.
Similar to Collision coverage, Medical Payments is also a coverage often automatically included in your Boat Insurance policy. Payments are available to cover medical costs for you or your passengers in a covered event.
Beyond the basic coverage options such as Comprehensive and liability, insurance carriers offer a myriad of additional coverage extensions. Some additional coverages are worth every penny for some boat owners, while others may not make much sense. This is where a careful review of your insurance needs with your insurance agent is important.
A few coverage options available in today’s marketplace include:
- Fishing equipment – Additional limit to cover expensive fishing gear.
- Mechanical breakdown – Pays the cost to repair or replace motors due to a mechanical breakdown including normal wear and tear.
- Roadside assistance – Provides coverage if your trailer or tow vehicle becomes disabled.
- Pollution – Covers the cost of fuel or oil spills resulting from a covered loss.
- Trip interruption – If more than a predetermined number of miles away from your home (usually 100 miles), coverage is provided for a hotel, food, and other costs if your trailer or tow vehicle breaks down.
- Watersports – Additional coverage for injuries caused by wake or kneeboarding, skiing, tubing, or other similar activity.
- Wreckage removal – Pays the cost to remove a sunken or crashed vessel.
Having a Boat Insurance policy designed for your needs can mean the difference between getting back on the water quickly or watching from the shoreline. To learn more about insuring your boat, contact the experts at Duliban Insurance Brokers at 1-(855) 385-4226. Our licensed insurance experts will be happy to answer any questions you have.