Watercraft Coverage
Watercraft insurance is intended to protect your boat, yacht or personal watercraft against physical damage and your liability associated with operating a watercraft. It offers similar coverages to auto insurance but also includes specialty coverages associated with watercraft ownership and usage.
FAQs
Types of watercraft
Watercraft insurance is an umbrella term that encompasses several different types of water-based vehicles.
Boats include vessels under 197 feet long. These can be power or sail boats. Anything longer than 197 feet is considered a ship.
Yachts are between 27 and 197 feet long. This coverage is often more broad and specialized than boat coverage. Larger vehicles tend to travel greater distances and are therefore exposed to additional risks. Likewise, yachts typically have a higher value than boats.
Personal watercrafts includes recreational surface-skimming crafts such as Jet Skis, Sea-Doos and WaveRunners. Typically these crafts have engines with horsepower between 60-310 horsepower. Your homeowners policy may offer some coverage for these types of crafts but typically the limits available aren’t sufficient.
What does watercraft insurance cover?
Property
Physical damage coverage typically pays for repair or replacement of your watercraft due to a covered cause of loss. It covers the craft’s hull, sails, furnishings, motor and more. Traditional covered causes of loss include: weather related perils (like wind, hail, waves and lightning), theft, vandalism, collisions (with docks, submerged or floating objects or other boats) and fire. You’ll want to ensure you have coverage for your craft while it is on the water, while it is moored, during storage on land and while you transport it over land.
Liability
Liability covers your legal obligations to third parties. It insures you against damage you caused to another boat or damage your boat caused to other property (like a dock), as well as bodily injury you cause to a third party that is result of the ownership or operation of your vessel. This coverage part also helps pay for your legal defense if you are sued.
Medical payments
This coverage can help pay for first aid treatment, ambulance transportation, hospital and other medical costs that are the result of someone being injured on your boat. Medical payments is a no fault coverage so you don’t have to be legally responsible for coverage to kick in. Depending on your policy, this may include injuries to you and your family, injuries during boarding or leaving the vessel and injury that occurs while being towed behind your craft (like during water skiing).
Uninsured watercraft
Watercraft insurance isn’t mandatory is most states so there are many boaters that operate without liability coverage. Uninsured watercraft coverage is intended to help cover the injuries sustained aboard your vessel and property damage to your vessel that are caused by another boat operator who doesn’t have insurance. This coverage also covers hit and runs and operators who do not have enough insurance coverage to cover the costs of an accident.
Other coverages
On water towing & assistance is meant to cover unexpected breakdowns or running aground. It can also cover towing to a repair shop, delivery of fuel or parts and emergency labor.
Non-owned coverage extends your liability to a boat owned by another party that you borrow.
Accessories coverage includes equipment like radar or geo-location instruments.
Lay-up provides coverage during the off season and those periods when your boat isn’t in the water. You may be able to receive a discount while your vessel is in the lay-up period.
Ice & freeze is intended to cover damage from cold weather.
Fuel spill liability helps cover the clean-up costs associated with an accidental discharge of fuel.
Personal effects is useful if you have expensive equipment on your watercraft. It includes items such as clothing and fishing gear while they are being loaded and unloaded and while aboard your watercraft.
Wreckage removal steps in if you wreck your watercraft and it has to be removed.
Hurricane haul-out can assist with the costs of getting your boat out of harm’s way before a storm.
Boat trailers coverage is important if you own a trailer and use it haul your watercraft.
Valuation type
You may be presented with different valuation options when purchasing watercraft insurance.
Actual cash value is the cost new of your watercraft, less depreciation.
Agreed value is a valuation for your watercraft that you and your carrier agree on.
What doesn’t watercraft insurance cover?
Like any other type of insurance, watercraft coverage excludes certain causes of loss. Most policies exclude coverage while your craft is chartered to another party or if it is being used to carry passengers for a fee. Wear and tear, gradual deterioration, marine life, dents and scratches and defects are also common exclusions. While not a traditional exclusion, many watercraft policies limit the geographic areas in which a vessel can operate while maintaining coverage.
Federal Longshore & Harbor Workers’ Compensation Act
You will want to verify if your watercraft policy offers liability coverage under this act. It is meant to cover your statutory liability to temporary shore-based workers, like a mechanic or marina employee, if they become injured while aboard your vessel.
Jones Act and General Maritime Law
If you employ paid crew members, you’ll need to ensure that your policy covers your liability to the crew as required.
Does my homeowners or auto insurance cover my watercraft?
Neither homeowners nor auto insurance are designed to cover watercrafts. Some policies may have minimal coverage for watercrafts but they usually include size and horsepower restrictions. If you rely solely on these throw-in coverages, you’re likely to be underinsured.
Should I purchase watercraft coverage?
Watercraft insurance is only mandatory in a few states but it is often required by loan providers and in the lease agreements with marinas. Even if you aren’t required to have watercraft insurance, it provides protection from costly legal fees associated with injuries on the water.
What does watercraft coverage cost?
Premium costs for this type of insurance vary depending on many different factors. The size of the craft, its age and condition, its mooring location and its intended use are all considered when carriers determine pricing. Insurance carriers will also consider the type of watercraft, its value, the intended area of navigation and previous boating experience. You may qualify for discounted premiums if you take a boat safety course or if you have multiple lines of coverage with the same carrier. Discounts may also be offered for having safety devices (like automatic fire extinguishing systems, tracking devices or anti-theft alarms) on your watercraft.