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5 Key Questions to Answer about Your Boat

When asked to imagine the “average” boat, many people think of a large, luxurious sailboat with a catchy name painted across the back.
The reality is that boating is one of Americans’ favorite pastimes. Despite the belief that most boats are large, luxury craft, a National Marine Manufacturers Association (NMMA) report notes that 95% of all registered watercraft are under 26 feet in length. The NMAA report also tells us that one of every 10 U.S. households owns a boat, which means boating is a very popular way to spend time with friends and family.
When you’re insuring watercraft, there are several pieces of information you’ll need to generate an accurate quote:
•The year, make & model – like an auto, all boats have a year, make and model. The primary difference is the lack of a VIN decoder, so you’ll need the year, make and model from the customer. You may also need to know what type of boat it is: for example, is it a cuddy cabin or a bow rider?
•The propulsion type – there are several propulsion types. The most common are outboard, inboard, inboard/outboard (aka stern drive) boats, jetboats and sailboats. There are many great resources online to help build your knowledge.
•The horsepower and top speed – there are no speed limits on the water, and some boats have top speeds well in excess of 100 miles per hour. Each carrier has top-speed guidelines, so you’ll want to ensure the boat you’re quoting is eligible. Horsepower is the combined horsepower of all engines, with some boats having two, or even three, engines.
To help you get ready for boat insurance season, here are a few key questions to be able to answer when insuring your watercraft:
1)      What extra equipment do you have on your boat? There are three different types of equipment to consider when insuring watercraft. First is aftermarket equipment that is permanently mounted; things like fish finders, wakeboard racks, LED lights or sound systems. For many carriers, you’ll include permanently attached equipment in the hull value.
You will also have things like boat fenders, oars, and tarps that aren’t affixed to the boat, but are used exclusively with the boat. With most carriers, this will be classified as unattached equipment. Every boat will have unattached equipment, so you’ll want to ensure the policy you buy has adequate coverage for those items.
Lastly, you will bring personal items onto the boat. This will be things like your clothing and beach towels, your cooler and portable grill, or fishing poles. For most policyholders, it won’t amount to much on any given trip, but ensure you have adequate protection for personal items to avoid filing a claim on your homeowners’ policy.
2)      How much money do you want the carrier to pay you if your boat is stolen or destroyed? Liberty consumer research shows that watercraft consumers are more concerned about the value of your coverage vs. the price of the policy. Watercraft hold your value well over time, but like automobiles, watercraft depreciate rapidly. Agreed value or replacement cost coverage will protect your favorite hobby and ensure you could buy another watercraft if your boat was deemed a total loss.
An agreed value policy will guarantee the value of your boat. For example, if you purchased a new boat today for $40,000, and insured it at agreed value, the agreed value payment would be $40,000, minus the deductible, even if it sinks 15 years from now. That’s valuable protection!

​3)      Did you know you may be required to raise your boat if it sinks? Do you know what happens if it leaks gasoline or oil into the water? Many boaters think that liability is limited to injuring someone on another boat. In reality, one of the largest liability exposures is wreckage removal and fuel spill liability. If your boat sinks, you are often required by the Coast Guard or Park Services to raise the boat. The cost can cost upwards of $25,000! If the boat leaks oil or gas into the water, the cost to remediate can be over $75,000. Fines and fees can add on another $30,000. If another boat was involved, you can nearly double the cost, plus add on the cost of replacing the claimant’s boat and any associated injuries.
All this to say that the common limit of $50,000 of fuel spill and wreckage removal coverage is likely not enough and could leave you with a large bill to pay out of pocket.
4)      What happens if you have a break down while towing your boat? Auto roadside assistance policies are for the covered autos only. For example, auto roadside assistance won’t change a tire on the boat trailer if it blows out. If the towing vehicle breaks down, you’ll tow it away but leave the boat and trailer on the side of the road. The best practice is to ensure that if you tow your boat you have a watercraft policy that includes roadside assistance/on-road towing coverage to avoid a bad experience.
5)      Do you have any unusual exposures? Boat owners sometimes have unusual exposures, like having multiple owners, renting it as an AirBNB, or you occasionally use it commercially as a fishing guide. These exposures can impact whether a boat is eligible for coverage with your carrier, so it’s important to flesh out any unusual exposures that may exist.
There are many different factors to consider to properly insure watercraft. Answering these five questions can help you get the coverage that gives you peace of mind while you’re out on the water.